What's going on?

Amazon and Facebook both opened up their box of tricks to reveal better-than-expected second-quarter results late on Thursday, and investors initially joined in the celebrations by buying up their stocks.

What does this mean?

Amazon reported better-than-expected revenue thanks to a rise in demand for online shopping, and its profit massively outstripped forecasts as well � despite $4 billion worth of additional coronavirus-related expenses. Looking ahead, Amazon reckons it�ll earn more than investors forecast this quarter too.


Now to Facebook: the advertising behemoth revealed a bigger-than-expected increase in monthly active users, pushing its quarterly revenue and profit past forecasts. It turns out that when you have eight million ad partners to your name, big-name boycotts don’t actually have that much of an impact on earnings. If anything, Facebook is more focused on the receding pandemic: the company thinks the recovery will keep active user numbers from rising as the year goes on.

Why should I care?

For markets: Yoink.

Twitter�s weaker-than-expected revenue report last week hinted at still-slowing advertising revenue growth for social media platforms, but Facebook looks like it might�ve been hoovering up advertisers’ money at its rival�s expense. That�s a strategy Amazon knows well: its own advertising business grew 41% � compared to Facebook�s 10% � and is now six times the size of Twitter�s overall.

The bigger picture: Mmm. Grilled executive.

On Wednesday, the US government challenged the CEOs of Amazon, Facebook, Alphabet, and Apple on the amount of influence they have. And with good reason: 35% of the world uses Facebook, while Amazon controls 40% of US ecommerce. Big Tech may even be forced to break apart if the Democratic Party wins big in November�s US election � an increasingly likely outcome.