Tech Giants Brace for Regulatory Shifts as Trump Prepares for Term Two
As President Donald Trump gets ready to enter his second term, the tech sector is gearing up for substantial changes in regulations. Uncertainty looms; while some anticipate a deregulatory climate, others foresee intensified scrutiny of Big Tech. The selection of Andrew Ferguson as the chair of the Federal Trade Commission (FTC), who has pledged to end the alleged vendetta against competition and free speech, hints at a complicated regulatory landscape ahead.
Tech Companies Strengthen Ties with the Administration
Large tech firms are now actively working to build relationships with the new administration. By increasing financial contributions and engaging in outreach, they aim to influence policies on artificial intelligence (AI), energy regulation, and antitrust enforcement.
In light of a potentially stricter regulatory environment, leading companies like Alphabet GOOGL, Microsoft MSFT, Meta Platforms META, and Apple AAPL are strategizing how to navigate these challenges in 2025.
Alphabet’s Struggle with Antitrust Pressures
Alphabet – Despite being a Zacks Rank #3 (Hold) stock, Alphabet, Google’s parent company, has faced substantial regulatory hurdles under Trump. Recent actions by the United States Department of Justice include proposals to dismantle its search monopoly, considering the sale of Chrome and Android.
In response, Alphabet is proactively working with the administration, funding legal briefs opposing certain executive orders, and engaging in discussions around antitrust policies. Lobbying efforts are underway to maintain its core services, particularly its advertising business.
Over the past 30 days, the Zacks Consensus Estimate for Alphabet’s 2024 earnings has held steady at $8.02 per share. Meanwhile, GOOGL shares have risen 6.8% over the last six months.
Alphabet Inc. Price and Consensus
Alphabet Inc. price-consensus-chart | Alphabet Inc. Quote
Microsoft’s Engagement Amid Scrutiny
Microsoft – Also carrying a Zacks Rank #3, Microsoft faces several regulatory challenges, particularly in antitrust and cybersecurity. The FTC has opened a thorough investigation into its business practices for potential anti-competitive behavior.
To navigate this landscape, Microsoft is lobbying the administration for AI policies that avoid costly regulations and facilitate data usage. Additionally, it is investing in nuclear energy to support the growing need for clean energy as it expands its AI data centers, demonstrating its commitment to sustainable practices.
The Zacks Consensus Estimate for Microsoft’s fiscal 2025 earnings has stabilized at $12.93 per share over the past month, though shares have decreased by 2.4% within the last six months.
Microsoft Corporation Price and Consensus
Microsoft Corporation price-consensus-chart | Microsoft Corporation Quote
Meta Adjusts Strategies Amid Regulatory Challenges
Meta Platforms – With a Zacks Rank of #3, Meta confronts considerable regulatory issues linked to platform control and data privacy. Under the Trump administration, it has come under fire for its content moderation and market dominance practices.
In addressing these challenges, Meta is proactively adjusting its policies to prioritize free speech while tackling harmful content. It is also engaging with regulators to mitigate antitrust concerns related to its advertising strategies and potential monopoly.
The Zacks Consensus Estimate for Meta’s 2024 earnings remains unchanged at $22.68 per share, with shares increasing by 17.3% over the last six months.
Meta Platforms, Inc. Price and Consensus
Meta Platforms, Inc. price-consensus-chart | Meta Platforms, Inc. Quote
Apple’s Response to Legal Scrutiny
Apple – Another Zacks Rank #3 stock, Apple is facing scrutiny primarily concerning market influence, data privacy, and antitrust issues. Recently, a judge in New Jersey appointed several law firms to pursue a lawsuit alleging that Apple has monopolized the smartphone market, limiting consumer choices.
This lawsuit mirrors civil antitrust actions initiated by the U.S. Department of Justice against Apple, which accuse the company of violating the Sherman Act through monopolistic practices in the smartphone sector.
In light of these challenges, Apple is revising its App Store guidelines to increase flexibility and allow third-party app stores, aiming to project an image of fair competition. Engagements with regulators are ongoing to address these concerns, potentially leading to settlements that could avert harsher legal repercussions.
The Zacks Consensus Estimate for Apple’s fiscal 2025 earnings has remained intact at $7.43 per share, with shares increasing by 22.3% over the last six months.
Apple Inc. Price and Consensus
Apple Inc. price-consensus-chart | Apple Inc. Quote
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