The two tech giant corporations Alphabet, the owner of Google and YouTube experienced slow sales resulting in the downturn of the economy.
According to BBC, the slow economy has also affected Microsoft as the demand for its computers and other technology had deteriorated.
Alphabet said sales rose just 6% in the three months to September, to $69bn, as firms cut their advertising budgets marking the US firm’s weakest quarterly growth in nearly a decade outside of the start of the pandemic.
For Microsoft, its sales rose by 11% to $50.1bn, marking its slowest revenue growth in five years connoting that Consumers and businesses around the world are cutting back as prices rise and interest rates go up, fuelling fears of a global recession.
The report also said a strong US dollar has also hurt American multinationals, making it more expensive to sell products abroad.
Profits at Alphabet fell nearly 30% to $13.9bn in the quarter, as YouTube advert revenues dropped for the first time since the firm started to report them publicly.
Sales growth at the firm has slowed for five consecutive quarters.
The chief executive officer of Google, Sundar Pichai said that Alphabet was “sharpening” its focus and “being responsive to the economic environment”.
Reacting to the tech company’s low sales, a principal analyst at Insider Intelligence, Evelyn Mitchell said Google’s economic mishap is a bad omen for digital advertising as a whole.
“When Google stumbles, it’s a bad omen for digital advertising at large,” said Mitchell, noting that Google’s core website has in the past been more resilient to ad spending downturns than social media sites like Facebook or Snap.
“This disappointing quarter for Google signifies hard times ahead if market conditions continue to deteriorate.”