The American technology industry is on a hot streak. For the last decade-plus, tech stocks far outperformed expectations from investors and gains from almost any other industry. As other, once-important industries like retail see a sharp decline, Apple, Amazon, and the like continue to grow at an amazing rate.
Why? For one, these companies are disrupting existing industries, and not just retail. Everyone from camera companies to delivery businesses are either seeing a drastic decline in business or waiting for their day to come when the world’s largest tech companies find a way to do what they do, but better. This is causing decades-old corporations to shut down or downsize at an alarming rate.
Then there’s the fact that these companies make ungodly amounts of money. We’re talking more money than you will ever see in a hundred lifetimes. Each of the five biggest tech companies in the world — Microsoft, Amazon, Facebook, Google, and Apple — makes between tens of billions and hundreds of billions in revenue each year. How they acquire these billions is markedly different.
How do multi-billion-dollar tech companies make money?
To get an idea of how the five biggest American tech companies make money and keep growing on the stock market, you need to look at the products they sell. Thanks to the folks at VisualCapitalist.com (and StockTwits user Erik Johnson), we have this handy infographic to give you an idea just what lines the pockets of America’s tech giants.
Should you invest in these companies?
Each of these companies has a market cap of over $400 billion (with a B). Apple has a market cap of double that figure. Though you likely won’t make nearly as much on these companies as their original investors, most of them don’t show any signs of slowing down. If you really want to invest in $AAPL, $AMZN, $FB, $GOOG, or $MSFT (instead of, say, low-risk, low-cost ETFs), be sure to do your research before you invest a single dollar…or several hundred, just in case you actually want to buy a single share of their stocks.