The tech sector has driven the stock market for years, with businesses like Apple and Microsoft acquiring some of the most valued in the world.
However, as central banks attempt to rein in spiraling inflation, tech equities will face a reckoning in 2022. The Federal Reserve of the United States raised interest rates for the first time since 1994 on Wednesday.
“I think there’s more pain to come,” said, Private equity boss Orlando Bravo.
Bravo continues, “When those companies really start getting down to answering the investor question, the path to profitability, they’re not going to love what they see.”
Netflix and Zoom have seen their stock prices plummet by roughly 63 percent and 70 percent, correspondingly. The workout equipment company Peloton has lost more than 89.8% of its worth.
“That requires a lot of cost reductions, it requires a lot of pain, And it’s difficult to execute especially in a public setting, ” Bravo, founder of buyout firm Thoma Bravo, added.
