Big Tech Tech Stocks Plunge
Musk, the Richest Person, Also Loses 9 Trillion Won in Assets
On the 2nd (local time), when the US stock indices fell sharply enough to be called "Black Friday," the asset valuations of the world's richest individuals, including Amazon founder Jeff Bezos, also significantly decreased.
On the 3rd, Bloomberg reported that on the 2nd alone, Bezos's net worth valuation dropped by $15.2 billion (approximately 20.7 trillion KRW), and the total asset value of the world's top 500 billionaires listed on the Bloomberg Billionaires Index decreased by $134 billion (approximately 182.4 trillion KRW). Bezos, ranked second on the Bloomberg Billionaires Index, saw his net worth fall by $15.2 billion in a single day, bringing it to $191 billion (approximately 260 trillion KRW). This decline in Bezos's net worth was the third largest, following April 4, 2019, when he split assets due to divorce, and April 29, 2022, when Amazon's stock price plunged 14%.
The world's richest billionaire on the index, Tesla CEO Elon Musk, also saw his assets decrease by $6.57 billion (approximately 8.9 trillion KRW). Additionally, Mark Zuckerberg, Meta CEO and the 4th richest, lost $3.39 billion (approximately 4.6 trillion KRW), Larry Page, Google co-founder and 6th richest, lost $3.45 billion (approximately 4.7 trillion KRW), and Larry Ellison, Oracle co-founder and 7th richest, saw a decrease of $4.37 billion (approximately 5.9 trillion KRW). The total asset decline of tech company billionaires on that day amounted to about $68 billion (approximately 92.5 trillion KRW).
The Nasdaq index, which is tech-stock focused, plunged 2.43% in a single day on the 2nd, entering a correction phase. This was due to growing doubts about the artificial intelligence (AI) boom that had driven the rally so far, coupled with disappointing US July employment data, including an unemployment rate of 4.3%. As a result, the stock prices of major companies by market capitalization such as Microsoft (-2.07%), Nvidia (-1.78%), Alphabet A (Google's parent company, -2.40%), Meta (-1.93%), and Tesla (-4.24%) all declined consecutively.
Jeff Bezos, founder and CEO of Amazon, the world's largest e-commerce company Photo by AP Yonhap News
In particular, Amazon, the world's largest e-commerce company, saw its stock price plunge 8.78% amid poor earnings. On the 1st, Amazon announced that its Q2 (April-June) revenue and operating profit were $147.98 billion and $14.7 billion, respectively. Although operating profit exceeded market expectations of $13.6 billion, revenue fell short of the forecast of $148.56 billion. Moreover, Amazon reportedly invested heavily in building AI infrastructure. The company announced that its total capital expenditure increased by 50% year-over-year to $17.6 billion, which included costs for cloud and generative AI infrastructure development. Amazon is fiercely competing with Microsoft in the cloud computing market. Regarding this, Bloomberg pointed out that big tech companies' AI-related capital expenditures are excessive relative to demand.
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