SINGAPORE (May 20): In the aftermath of the global financial crisis in 2008, a bunch of US tech firms emerged as icons of growth in a slow-growing world. Investors bet on Apple, Amazon.com, Alphabet, Netflix, Facebook and Microsoft because they had one thing in common: the ability to repeatedly beat growth expectations.

Now, the tech powerhouses are getting their comeuppance. On April 29, Alphabet, parent of search giant Google, reported quarterly results that seemed to take the wind out of its sails. Revenue growth dipped an annualised 17%. Once a growth supremo, Alphabet is struggling to show growth. Its stock plunged nearly 9%, wiping US$70 billion ($95.7 billion) off its market value, after the results were released.

Analysts now expect Alphabet’s revenues to grow just 16% this year and 13% next year, slowing to 10% growth in 2021. That compares with 23.4% growth last year. Social media giant Facebook’s revenues grew 35% last year and are forecast to grow 26% this year, while some of the cloud-centric software-as-a-service firms such as Service-Now, Workday and PagerDuty are growing at over 40% annually. On average, component firms of Standard & Poor’s 500 are growing revenues at a 6% annual clip, a pace that is likely to be maintained for a while, given the low US unemployment levels and robust consumption.

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