The Tech Industry's Epic Two-Year Run Sputters

Investors are divided about whether technology companies are set for a deep retrenchment or if growth is simply slowing from pandemic highs. From a report: The technology industry, which powered the U.S. economy during the pandemic and grew at tremendous scale during a decade of ultralow interest rates, is confronting one of the most punishing stretches in years. Global powerhouses and fledgling startups are feeling pain from a variety of economic, industry and market factors, spawning postpandemic turbulence in e-commerce, digital advertising, electric vehicles, ride-hailing and other segments. Companies that emerged as job-creating juggernauts in the past two years -- collectively adding hundreds of thousands of workers to their payrolls in engineering, warehouse and delivery jobs -- have begun to freeze hiring or even lay off employees. Concerned that some of the forces that have propelled tech ever upward have begun to fade, investors have sent share prices for a number of companies, including Lyft and Peloton plunging on disappointing financial results or other news. The stocks of Netflix, Facebook parent Meta Platforms and Amazon.com all are down more than 30% this year, exceeding the more-than-13% drop in the S&P 500. Investors are divided on the question of whether the slowdown is temporary -- as well-positioned companies work through a period of stagnation after expanding ultrafast in recent years -- or if these are the early signs of a deeper retrenchment for the industry and its investors.

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