Cuz the primary goal is hitting revenue targets and showing "growth" in those metrics every quarter. All else is secondary. You can see what their priorities are when they talk to Wall St every quarter - https://investor.atmeta.com/investor-news/press-release-deta...
Every USA company is the same. If you don't grow by 15% in a year you are a failed company. No wonder the USA is turning into fascism, you can't keep those numbers without exploiting and eating everything you can.
Black holes on Earth are created not in large hadron colliders, they are in human minds.
> If you don't grow by 15% in a year you are a failed company
This just isn't true. Giant numbers of small companies out there doing just fine.
It's only if you need investment that it's hard, because the government sets a floor on what you should expect on a return with the bond market. So a business taking money has to promise a return greater than what the government will just give you.
This is true for any company with investors. The 15% figure may be hyperbolic when applied to all companies no matter the size and sector. But the need for ongoing growth is very factual
The last two publicly traded companies I’ve worked for had increased revenue YoY for several quarters but the stock price was smacked because the gains weren’t enough. I looked around and this doesn’t seem to be an uncommon trend either.
15% may be hyperbolic but there seems to be a percentage of growth that exists where the company is still perceived as failing.
Stock prices for growing companies are highly volatile because no one really knows what the enterprise will ultimately be worth. This is fine. If investors actually perceived the company as failing then the stock price would be close to zero (or at least down close to book value).
Seems like the relevant information is what the stock price was before and after. As nardov says, price is an estimation of future value, not just the current.
As a result, it varies based on performance relative to expectation, as well as a wide range of external factors.
It’s a race globally - no one wants to be the first to not keep up.
A large enough simultaneous spike to reset expectations though, and all the sudden investor expectations switch to ‘lose the least money’.
Notably, the ones who expect/require this up and to the right are generally things like mutual funds, pension funds, and other institutional investors.
You know, the ones who Grandma (or Mom) relies on to not be eating dogfood in retirement.
Black holes on Earth are created not in large hadron colliders, they are in human minds.