Facebook CEO Mark Zuckerberg was in the crosshairs for lawmakers for much of the year after the Cambridge Analytica scandal, which revealed that millions of Facebook users had their personal data harvested for use in political campaigns, rocked confidence in the platform.
His social media platform was also criticised for not doing enough to combat fake news and hate speech, while business leaders such as Apple’s Tim Cook said it had missed the opportunity to self-regulate and needed to be more closely scrutinised.
Facebook also faced obstacles to growth in plateuing user numbers and difficulties monetising its pivot into video content.
In November, he failed to appear in front of parliamentarians from nine countries at an inquiry into online misinformation.
— The CEO Magazine (@TheCEOMagazineG) November 27, 2018
Google did not have a horror year to the same extent Facebook did, but it also faced greater scrutiny than ever before. After months of controversies, CEO Sundar Pichai was grilled on data collection, privacy and alleged bias in its search engine algorithm by the House Judiciary Committee.
— The CEO Magazine (@TheCEOMagazineG) November 2, 2018
The search engine giant also faced a backlash from its staff over its handling of sexual harassment claims and in November thousands of employees walked off the job in protest. Google staff were also outraged when it emerged the company was working with the Pentagon on a program that used AI to potentially produce more targeted attack drones.
Amazon continued to dominate online retail
Amazon briefly became a trillion dollar company by market cap in 2018 as the FAANG companies propped up the US stock market.
— The CEO Magazine (@TheCEOMagazineG) January 10, 2018
From the S&P 500’s low on 8 February to August, FAANG and Microsoft stocks alone were responsible for 38% of the stock market’s gain.
Yet Amazon also faced significant new challenges in 2018. After a very public campaign from Vermont Senator Bernie Sanders, the company raised its minimum wage to $15 an hour for its US workforce.
— The CEO Magazine (@TheCEOMagazineG) November 13, 2018
The company also concluded its lengthy and often controversial search for the next locations for its new headquarters, settling on Crystal City, Virginia and Long Island, New York.
Amazon soared in the second quarter, largely due to the success of its cloud computing platform, Amazon Web Services, which grew nearly 50% in the three months. The retail giant also had its biggest Prime Day yet and its Prime program reached more than 100 million members internationally.
After reporting slower than expected revenue growth at its third-quarter earnings call, investors cooled on Amazon stocks. 8% of the company’s value was wiped off in a single day, costing CEO Jeff Bezos US$19 billion. Whether it can make inroads internationally and combat new market entrants will be crucial to its fortunes in 2019.
— The CEO Magazine (@TheCEOMagazineG) October 30, 2018
Growth of Apple’s iconic iPhone tailed off in 2018
Apple saw declining sales for its iPhone and decided not to release unit sales going forward, but it has continued to aggressively pursue other revenue streams. It sunk considerable resources into its forthcoming streaming services, signing the likes of Oprah Winfrey, Reese Witherspoon and Jennifer Aniston to create original content. There are still few details on when the service will be launched or what exactly it will offer.
— The CEO Magazine (@TheCEOMagazineG) September 12, 2018
Under the leadership of Tim Cook, the company continued to launch innovative new products such as its Apple Watch, which is registered as a medical device by the FDA because of its health monitoring features. It is widely thought Apple’s future, however, will be more closely tied to services such as music streaming and even fintech.
Netflix had the least tumultuous year of the FAANG group, bouncing back from a somewhat disappointing second quarter with continued strong subscription growth and a growing foothold in licensing its own content. “We don’t believe in ‘open-ended growth stories’,” RBC Capital Markets analyst Mark Mahaney told CNBC. “But, darn, Netflix is about as close to one as you can find in today’s market.”
— The CEO Magazine (@TheCEOMagazineG) December 4, 2018
Microsoft didn’t make it into the FAANG acronym, but in 2018 it showed it was back to this level of relevance after successfully moving away from its base as a software company and increasingly becoming a cloud services firm.
It even briefly eclipsed Apple and Amazon for the title of world’s largest company by market cap.
It was also named the ‘most just’ company in the US and its CEO, Satya Nadella, was voted the best CEO by his employees.
The company’s 2018 acquisition of XOXCO also hints at a growing interest in conversational AI.