7 Scariest Things America’s Biggest Companies Just Told Us About the Economy

Some of the biggest corporations in America recently reported less-than-stellar financial results. Could this mean a recession is imminent?
Updated May 1, 2024
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For most American companies, the second fiscal quarter has officially ended. Many of the largest publicly traded companies have released their quarterly earnings statements, and some of the biggest corporations in the country reported earnings that were much lower than expected.

Fears of a coming recession are already high, and ordinary Americans aren’t the only ones preparing for the future with recession checklists. Along with doom-and-gloom statements by prominent business leaders like Mark Zuckerberg and Elon Musk, bad financial news from top companies has the potential to stoke concerns about the economy even higher.

So, which corporations failed to meet their financial expectations last quarter? And should everyday Americans start to worry?

Meta (Facebook)

Romain TALON/Adobe Meta new name for Facebook Inc

Mark Zuckerberg has made it clear that he doesn’t feel particularly hopeful about the country’s current (and future) economic prospects. In an employee town hall in early July, Zuckerberg said he thought “this might be one of the worst downturns that we’ve seen in recent history.”

Meta (Facebook’s parent corporation) is certainly acting as though economic disaster is near. While the company planned to add up to 10,000 engineers in 2022, instead it has cut 30% of its existing engineer roles. The company is also laying off employees who can’t meet Meta’s new, more aggressive productivity goals.

Meta’s second-quarter financial statement anticipates continued “macroeconomic uncertainty” through at least the end of the third quarter. Trimming staff and cutting costs are part of its main plans to weather economic uncertainty. But since the most common sign of a recession is a declining job market, Meta’s strategy to avoid disaster could fuel concerns that other corporations will start cutting staff as well.

Best Buy

wolterke/Adobe Best Buy store exterior and trademark logo

Speaking of layoffs, Best Buy also reported losses in Q2 and plans to trim staff to compensate. According to the company’s most recent financial statement, inflation and low consumer confidence contributed to a drop in Best Buy’s revenue. And even though Best Buy’s sales in 2022 are higher than they were before the pandemic, the company plans to roll out cross-country layoffs throughout August.

On the whole, though, the U.S. job market is incredibly stable. In July, the unemployment rate fell to the pre-pandemic rate of 3.5%, which is also the lowest the rate has been since the late 1960s. As long as U.S. employees can still make money by finding and filling open roles, a recession isn’t likely. And at least for now, Best Buy still has plenty of job listings and will likely add more as we get closer to the holiday season.


Kevin Brine/Adobe Walmart storefront

Thanks in part to supply-chain problems, Walmart ended up with too much stock on its shelves this year just when consumers stopped spending on non-essentials due to rising inflation. While Walmart’s customers still spent money on food and gas this summer, they left expensive electronics and other big-ticket items on the shelves.

As a result of declining sales, Walmart lowered its profit expectations for the second quarter, which caused its stock to drop dramatically at the end of July. However, in its most recent earnings statement, Walmart reported that it was already seeing sales pick up as the country approached the start of a new school year.

And while Walmart laid off around 200 corporate employees at the start of August, it hasn’t started slashing non-corporate jobs. These layoffs didn’t impact the rest of Walmart’s 1.6 million employees.


dennizn/Adobe Amazon prime day page on official amazon site

Walmart wasn’t the only retailer to experience setbacks in the first half of the year. Amazon’s June earnings report included the startling information that the company had cut 100,000 jobs across the globe. That number amounts to a 6% reduction in Amazon’s overall workforce, which makes it the largest cut in a single quarter in Amazon’s history.

By the end of July, though, Amazon reported that its sales had risen 7% during the second quarter. July’s inflation rate didn’t balloon as much as some financial experts had feared.

Slowing inflation and high overall employment rates could bode well not just for Amazon and its employees, but also for consumers doing their best to manage their money during uncertain economic times.


piter2121/Adobe Alphabet Inc. website displayed on smartphone hidden in jeans pocket

According to Alphabet’s most recent earnings report, revenue from Q2 was 13% higher in 2022 than in 2021. While 13% is definitely still growth, it’s a far cry from the 62% revenue growth the company experienced last year. According to Alphabet and Google CEO Sundar Pichai, the company is “facing a challenging macro environment with more uncertainty ahead.”

So far, Google isn’t planning layoffs for its 174,000 full-time global staff members. However, it’s instituting an efficiency program meant to encourage employees to increase productivity. Some employees worry that even though Google still has open job listings, it could start cutting roles if productivity expectations aren’t met over the next month.


wachiwit/Adobe Apple logo on Apple Store in Bangkok

Let’s be clear: Apple is doing just fine. Per its most recent quarterly report, the company earned a record-breaking $83 billion in revenue in the second quarter.

So if Apple is so profitable, why did we include it in our list? After reviewing Apple’s quarterly earnings, Apple CFO Luca Maestri said, “Our June quarter results continued to demonstrate our ability to manage our business effectively despite the challenging operating environment.”

Frankly, for Apple to even acknowledge a “challenging operating environment” is rattling. Thus far in its history, the company has persevered through economic ups and downs and emerged virtually unscathed. But even though Apple is expected to roll out its first new product in years next year (a virtual headset), the company is reportedly planning to reduce expenses and pull back on hiring in 2023.

J.P. Morgan

Dennis/Adobe J.P.Morgan company logo on a website

In 2021, in spite of all the turmoil surrounding the COVID-19 pandemic, J.P. Morgan raked in more than $48 billion in revenue. This July, however, J.P. Morgan’s financial future isn’t looking quite as rosy. Instead, the bank didn’t meet its Q2 profit goals and is temporarily suspending its share buybacks.

Outside the realm of Wall Street, however, J.P. Morgan did alright for itself last quarter. Crucially, borrowers are still repaying their debts instead of defaulting. As long as the job market holds steady, lenders will likely be able to repay their loans, which is good news both for banks like J.P. Morgan and Americans looking for a sign that a recession isn’t set in stone.

The bottom line

Who is Danny/Adobe businesswoman with crossed fingers with index data on background

Major corporations missing their revenue goals, cutting expenses, and potentially slowing or stopping hiring might look like a clear run-up to a recession, but there are plenty of other signs a recession isn’t in our near future after all. Most importantly, the job market is astonishingly healthy. Inflation is still high, but July’s increase was lower than expected.

And while some major companies haven’t been as profitable this year, others (like Disney and Apple) are achieving record growth with no signs of stopping. Whether a recession is imminent remains to be seen. These companies may be preparing in case a recession hits, as should consumers.


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Author Details

Michelle Smith Michelle Smith has spent a decade writing for and about small businesses. She specializes in all things finance and has written for publications like G2 and SmallBizDaily. When she's not writing for work at her desk, you can usually find her writing for pleasure near large bodies of water.

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