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Tech stocks on display at the Nasdaq. 

Peter Kramer | CNBC

The S&P 500 is trading at a record and the Nasdaq is at its highest in two years. Alphabet shares reached a new pinnacle on Thursday, as did Meta and Microsoft, which ran past $3 trillion in market cap.

Don’t tell that to the bosses.

While Wall Street cheers on Silicon Valley, tech companies are downsizing at an accelerating clip. So far in January, some 23,670 workers have been laid off from 85 tech companies, according to the website Layoffs.fyi. That’s the most since March, when almost 38,000 people in the industry were shown the exits.

Activity picked up this week with SAP announcing job changes or layoffs for 8,000 employees and Microsoft cutting 1,900 positions in its gaming division. Additionally, high-valued fintech startup Brex laid off 20% of its staff and eBay slashed 1,000 jobs, or 9% of its full-time workforce. Jamie Iannone, eBay’s CEO, told employees in a memo that, “We need to better organize our teams for speed — allowing us to be more nimble, bring like-work together, and help us make decisions more quickly.” 

Earlier in the month, Google confirmed that it cut several hundred jobs across the company, and Amazon has eliminated hundreds of positions spanning its Prime Video, MGM Studios, Twitch and Audible divisions. Unity said it’s cutting about 25% of its staff, and Discord, which offers a popular messaging service used by gamers, is shedding 17% of its workforce.

AI is 'really at play here' with the recent tech layoffs, says Jason Greer

The swarm of activity comes ahead of a barrage of tech earnings next week, when Alphabet, Amazon, Apple, Meta and Microsoft are all scheduled to report quarterly results. Investors lauded the cost-cutting measures that companies put in place last year in response to rising inflation, interest rates hikes, recession concerns and a brutal market downturn in 2022. Even with an improving economic outlook, the thriftiness continues.

Layoffs peaked in January of last year, when 277 technology companies cut almost 90,000 jobs, as the tech industry was forced to reckon with the end of a more than decade-long bull market. Most of the rightsizing efforts took place in the first quarter of 2023, and the number of cuts proceeded to decline each month through September, before ticking up toward the end of the year.

One explanation for the January surge as companies budget for the year ahead: They’ve learned they can do more with less.

At Meta, in CEO Mark Zuckerberg’s words, 2023 was the “year of efficiency,” and the stock jumped almost 200% alongside 20,000 job cuts. Across the industry, artificial intelligence was the rallying cry as new generative AI technologies showed what was possible in automating customer service, booking travel and creating marketing campaigns.

‘Reposition themselves for AI’

Phil Spencer, CEO of Microsoft Gaming, appears at the Political Opening of the Gamescom conference in Cologne, Germany, on Aug. 23, 2023.

Franziska Krug | German Select | Getty Images

Alphabet CEO Sundar Pichai told employees in a memo titled “2024 priorities and the year ahead” that, “we have ambitious goals and will be investing in our big priorities this year,” and that “to create the capacity for this investment, we have to make tough choices.” And at Amazon’s Audible unit, CEO Bob Carrigan said “getting leaner and more efficient” is the way the company needs to operate for the “foreseeable future.”

Nigel Vaz, CEO of consulting firm Publicis Sapient, told CNBC that some companies are probably looking at the boon that Meta and Salesforce got after their hefty cost-cutting measures last year.

Salesforce cut about 10% of its workforce in January 2023, and the stock ended up nearly doubling for the year, its best performance since 2009. Following Meta’s announced cuts, the company’s shares had their best year since Facebook debuted on the Nasdaq in 2012.

“I look at Meta and Salesforce as only two examples of companies that needed the impetus,” Vaz said. “The minute they got the impetus, then demonstrated what happens when you act with edge on stuff that you probably knew you needed to do.”

Not just tech

The layoffs aren’t limited to the tech industry. Embattled bank Citigroup said earlier this month that it was cutting 10% of its workforce. And on Thursday Levi Strauss said it will lay off at least 10% of its global corporate workforce as part of a restructuring. Paramount became the latest media brand to announce cuts, with CEO Bob Bakish saying on Thursday the business needs to “operate as a leaner company and spend less.”

Within tech, a wide variety of companies, big and small and spanning the consumer and enterprise markets, are eliminating jobs.

At the large publicly traded companies, there’s an “intense focus” on profitability, margins and cost cutting, said Tim Herbert, chief research officer at CompTIA, which tracks trends across the tech sector. But, he added, there’s an “enormous base” of small and mid-sized tech companies across the U.S., and that in some cases contractors, freelancers and overseas workers are being hit particularly hard.

However, Herbert echoed Zeile in noting that there’s not enough data to get too panicked about the activity in January.

“There’s a lot of nuance to the data, so we always want to be a little bit careful not to read too much into it,” Herbert said. “We don’t want to ever get too hung up on just one month of data, or even two months of data.”

While investors will get a clearer picture on the near-term outlook for business and consumer spending in tech earnings announcements next week, the latest macroeconomic reports provide some reasons for optimism.

The economy grew at a faster-than-expected pace in the fourth quarter, and inflation cooled over that stretch, the Commerce Department reported Thursday.

Gross domestic product increased at a 3.3% annualized rate in the quarter, topping the Wall Street consensus estimate for a gain of 2%. Meanwhile, consumer prices rose 2.7% on annual basis in the quarter, down from 5.9% a year ago. Inflation has been easing from its pandemic-era peak in mid-2022.

The market has been rallying, as investors see those key numbers leading to the likelihood of Federal Reserve rate cuts in 2024 after the central bank lifted its benchmark rate 11 times in less than two years to fight inflation.

Vaz said many corporate leaders are optimistic over “inflation actually meaningfully starting to come down” at the same time that “spending is essentially coming back in so many sectors.”

— CNBC’s Michael Bloom, Annie Palmer and Jennifer Elias contributed to this report

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Google cuts hit Moonshots Factory

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Former Microsoft CEO Steve Ballmer says, as shareholder, tariffs are ‘not good’

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Former Microsoft CEO Steve Ballmer says, as shareholder, tariffs are 'not good'

President Trump’s new tariffs on goods that the U.S. imports from over 100 countries will have an effect on consumers, former Microsoft CEO Steve Ballmer told CNBC on Friday. Investors will feel the pain, too.

Microsoft’s stock dropped almost 6% in the past two days, as the Nasdaq wrapped up its worst week in five years.

“As a Microsoft shareholder, this kind of thing is not good,” Ballmer said, in an interview with Andrew Ross Sorkin that was tied to Microsoft’s 50th anniversary celebration. “It creates opportunity to be a serious, long-term player.”

Ballmer was sandwiched in between Microsoft co-founder Bill Gates and current CEO Satya Nadella for the interview.

“I took just enough economics in college — that tariffs are actually going to bring some turmoil,” said Ballmer, who was succeeded by Nadella in 2014. Gates, Microsoft’s first CEO, convinced Ballmer to join the company in 1980.

Gates, Ballmer and Nadella attended proceedings at Microsoft’s Redmond, Washington, campus on Friday to celebrate its first half-century.

Between the tariffs and weak quarterly revenue guidance announced in January, Microsoft’s stock is on track for its fifth straight month of declines, which would be the worst stretch since 2009. But the company remains a leader in the PC operating system and productivity software markets, and its partnership with startup OpenAI has led to gains in cloud computing.

“I think that disruption is very hard on people, and so the decision to do something for which disruption was inevitable, that needs a lot of popular support, and nobody could game theorize exactly who is going to do what in response,” Ballmer said, regarding the tariffs. “So, I think citizens really like stability a lot. And I hope people — individuals who will feel this, because people are feeling it, not just the stock market, people are going to feel it.”

Ballmer, who owns the Los Angeles Clippers, is among Microsoft’s biggest fans. He said he’s the company’s largest investor. In 2014, shortly after he bought the basketball team for $2 billion, he held over 333 million shares of the stock, according to a regulatory filing.

“I’m not going to probably have 50 more years on the planet,” he said. “But whatever minutes I have, I’m gonna be a large Microsoft shareholder.” He said there’s a bright future for computing, storage and intelligence. Microsoft launched the first Azure services while Ballmer was CEO.

Earlier this week Bloomberg reported that Microsoft, which pledged to spend $80 billion on AI-enabled data center infrastructure in the current fiscal year, has stopped discussions or pushed back the opening of facilities in the U.S. and abroad.

JPMorgan Chase’s chief economist, Bruce Kasman, said in a Thursday note that the chance of a global recession will be 60% if Trump’s tariffs kick in as described. His previous estimate was 40%.

“Fifty years from now, or 25 years from now, what is the one thing you can be guaranteed of, is the world needs more compute,” Nadella said. “So I want to keep those two thoughts and then take one step at a time, and then whatever are the geopolitical or economic shifts, we’ll adjust to it.”

Gates, who along with co-founder Paul Allen, sought to build a software company rather than sell both software and hardware, said he wasn’t sure what the economic effects of the tariffs will be. Today, most of Microsoft’s revenue comes from software. It also sells Surface PCs and Xbox consoles.

“So far, it’s just on goods, but you know, will it eventually be on services? Who knows?” said Gates, who reportedly donated around $50 million to a nonprofit that supported Democratic nominee Kamala Harris’ losing campaign.

— CNBC’s Alex Harring contributed to this report.

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AppLovin can offer TikTok ‘much stronger bid than others,’ CEO says

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AppLovin can offer TikTok 'much stronger bid than others,' CEO says

Piotr Swat | Lightrocket | Getty Images

AppLovin CEO Adam Foroughi provided more clarity on the ad-tech company’s late-stage effort to acquire TikTok, calling his offer a “much stronger bid than others” on CNBC’s The Exchange Friday afternoon.

Foroughi said the company is proposing a merger between AppLovin and the entire global business of TikTok, characterizing the deal as a “partnership” where the Chinese could participate in the upside while AppLovin would run the app.

“If you pair our algorithm with the TikTok audience, the expansion on that platform for dollars spent will be through the roof,” Foroughi said.

The news comes as President Trump announced he would extend the deadline a second time for TikTok’s Chinese-owned parent company ByteDance to sell the U.S. subsidiary of TikTok to an American buyer or face an effective ban on U.S. app stores. The new deadline is now in June, which, as Foroughi described, “buys more time to put the pieces together” on AppLovin’s bid. 

“The president’s a great dealmaker — we’re proposing, essentially an enhancement to the deal that they’ve been working on, but a bigger version of all the deals contemplated,” he added.

AppLovin faces a crowded field of other interested U.S. backers, including Amazon, Oracle, billionaire Frank McCourt and his Project Liberty consortium, and numerous private equity firms. Some proposals reportedly structure the deal to give a U.S. buyer 50% ownership of the company, rather than a complete acquisition. The Chinese government will still need to approve the deal, and AppLovin’s interest in purchasing TikTok in “all markets outside of China” is “preliminary,” according to an April 3 SEC filing.

Correction: A prior version of this story incorrectly characterized China’s ongoing role in TikTok should AppLovin acquire the app.

WATCH: AppLovin CEO Adam Foroughi on its bid to buy TikTok

AppLovin CEO Adam Foroughi on its bid to buy TikTok

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Trump’s tariff rates for other countries radically larger than World Trade data

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Trump's tariff rates for other countries radically larger than World Trade data

U.S. President Donald Trump speaks during an event announcing new tariffs in the Rose Garden at the White House in Washington, April 2, 2025.

Chip Somodevilla | Getty Images

President Donald Trump announced an aggressive, far-reaching “reciprocal tariff” policy this week, leaving many economists and U.S. trade partners to question how the White House calculated its rates.

Trump’s plan established a 10% baseline tariff on almost every country, though many nations such as China, Vietnam and Taiwan are subject to much steeper rates. At a ceremony in the Rose Garden on Wednesday, Trump held up a poster board that outlined the tariffs that it claims are “charged” to the U.S., as well as the “discounted” reciprocal tariffs that America would implement in response.

Those reciprocal tariffs are mostly about half of what the Trump administration said each country has charged the U.S. The poster suggests China charges a tariff of 67%, for instance, and that the U.S. will implement a 34% reciprocal tariff in response.

However, a report from the Cato Institute suggests the trade-weighted average tariff rates in most countries are much different than the figures touted by the Trump administration. The report is based on trade-weighted average duty rates from the World Trade Organization in 2023, the most recent year available.

The Cato Institute says the 2023 trade-weighted average tariff rate from China was 3%. Similarly, the administration says the EU charges the U.S. a tariff of 39%, while the 2023 trade-weighted average tariff rate was 2.7%, according to the report.

In India, the Trump administration claims that a 52% tariff is charged against the U.S., but Cato found that the 2023 trade-weighted average tariff rate was 12%.

Many users on social media this week were quick to notice that the U.S. appeared to have divided the trade deficit by imports from a given country to arrive at tariff rates for individual countries. It’s an unusual approach, as it suggests that the U.S. factored in the trade deficit in goods but ignored trade in services.

The Office of the U.S. Trade Representative briefly explained its approach in a release, and stated that computing the combined effects of tariff, regulatory, tax and other policies in various countries “can be proxied by computing the tariff level consistent with driving bilateral trade deficits to zero.”

If trade deficits are persistent because of tariff and non-tariff policies and fundamentals, then the tariff rate consistent with offsetting these policies and fundamentals is reciprocal and fair,” the USTR said in the release.

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