The coronavirus pandemic and subsequent lockdowns have had devastating financial effects on numerous businesses and sectors. According to data collected by Yelp, roughly 180,000 businesses were closed by April and a record 12,200 will never reopen. Restaurants, bars and nightlife venues have been hit the hardest, and retail and beauty businesses have also suffered major economic losses, with many permanently closing their doors.
And it’s not just small businesses that are suffering. A number of major companies have filed for bankruptcy since the beginning of the pandemic, including J. Crew, Gold’s Gym, Neiman Marcus, JCPenney, Pier 1 Imports, Hertz, GNC and California Pizza Kitchen. Although vaccines are being rolled out and officials such as Dr. Anthony Fauci predict a return to a more normal life in the latter half of 2021, the negative financial effects of the lockdown will be long term for many companies.
On the flip side, several companies have been thriving and actually saw an increase in revenues and profits during the lockdown period. With people spending more time at home — living and working — companies that offered online shopping, home entertainment, easy takeout meals and remote work technology have seen an influx in consumer dollars.
It seems like many people turned to video games to stay entertained while stuck at home. In the third quarter of 2020, video game maker Activision Blizzard’s earnings beat expectations by $100 million ($1.77 billion vs. $1.67 billion expected), and earnings per share were $0.14 higher than expected, Yahoo Finance reported. The pandemic’s effects also show in hours of video games played, which are up seven times over the same quarter a year ago.
With many people avoiding regular trips to the store, consumers have become even more reliant on e-commerce sites to get their essentials. This has proven fruitful for Amazon –the company posted 37% revenue growth for the third quarter of 2020, and revenue of $96.15 billion beat analysts’ expectations by $3.45 billion, according to analysts surveyed by Refinitiv.
Amazon expects sales to jump 28-38% in the fourth quarter. “We’re seeing more customers than ever shopping early for their holiday gifts, which is just one of the signs that this is going to be an unprecedented holiday season,” Amazon CEO Jeff Bezos said in a statement.
Learn More: 25 Biggest Companies You’ve Never Heard Of
Because of the pandemic, most document signing has had to happen virtually — and DocuSign’s software makes this process pretty seamless. The company’s total revenue increased 53% year-over-year to $382.9 million in 2020.
Etsy has benefited from the increase in online shopping during the lockdown. In October, the internet retailer reported a triple-digit increase in gross merchandise sales and revenue, the company reported.
Etsy became a go-to online retailer for face masks, and mask sales accounted for 11% of its overall gross merchandise sales. But even excluding mask sales, Etsy’s gross merchandise sales growth was up $1 billion year over year — an increase of 93%.
Take a Look: Which Companies Are Winning the Pandemic?
Facebook reported a Q3 revenue increase of nearly $4 billion year over year, from $17.383 to $21.22 billion. Daily active users rose 12% from the previous year. The company said it expects its ad revenue growth rate to increase, thanks to “an acceleration in the shift of commerce from offline to online.”
Overall net income for Facebook soared from $6.091 billion in 2019 Q3 to $7.846 billion in 2020.
The Home Depot
As Americans spent more time at home, many decided to take on home improvement projects using funds they would have otherwise spent on travel, gym memberships and other activities that were no longer an option due to lockdowns.
The Home Depot reported 2020 third-quarter earnings were up 24% year-over-year, and the average total purpose rose 10% over 2019 to $72.08.
With offices closed, many Americans are living in athleisure on a daily basis. This led to surprise revenue growth for Lululemon as consumers stocked up on workout apparel and yoga accessories (as opposed to dresses and suits), CNBC reported.
Lululemon’s sales for Q3 were $1.1 billion, up 22% from 2019, CNBC reported, and North America net revenue grew 19%.
As people began working remotely, the need for cloud computing increased. At the same time, people were spending more time at home playing video games. Both of these trends proved profitable for Microsoft, whose overall revenue grew 12% year over year for the quarter ending September 30, the company reported.
Microsoft announced stellar numbers across the board, with operating income up 25% to $15.9 billion and net income up 30% to $13.9 billion.
Good To Know: Companies That Are ‘Too Big To Fail’ Due to Coronavirus
Papa John’s sales surged during the coronavirus pandemic as more consumers stayed in and ordered takeout and delivery, CNBC reported. The company estimates its same-store sales growth was 23.8% for the third quarter, and revenue increased 17.1% to $472.9 million.
New menu items such as the Shaq-a-Roni pizza and add-ons such as Papadias have helped, Papa John’s CEO Rob Lynch said, according to Nation’s Restaurant News.
PayPal — the parent company of Venmo, Honeywell, Braintree and more — saw its net revenue increase 25% in the third fiscal quarter, the company reported. The company also achieved strong user growth, adding 15.2 million new net active accounts in the quarter, up 55% year-over-year.
“Our growth reinforces the essential role we play in our customers’ daily lives during this pandemic,” CEO Dan Schulman said.
Contactless payment options became the go-to during the pandemic lockdowns, so it’s no surprise that Square’s Cash App gross profit soared 212% to $385 million in the third quarter, the company reported. Square’s overall gross profit was up $794 million, up 59% year over year. In addition, the number of daily active Cash App customers nearly doubled from Q3 2019.
T-Mobile hit a record high with 100.4 million total customers at the end of Q3 2020. Driven by the merger with Sprint in April, T-Mobile has increased total revenues 74.2% (from $11.1 billion to $19.3 billion).
In November, online furniture retailer Wayfair reported that it increased total revenue 66.5%, from $2.3 billion to $3.8 billion, year over year. U.S. net revenue was up $1.3 billion. The number of active customers in direct retail increased 50.9% year over year to 28.8 million as of Sept. 30, 2020.
Before the pandemic hit, Wingstop had been focused on bolstering its digital and delivery capabilities, so it was primed to meet delivery and takeout demand when the U.S. went under lockdown. The chain opened 43 net new stories during Q3, and systemwide sales soared 32.8% to $509.2 million. Digital sales make up 62% of its overall business, Restaurant Business Online reported.
As the country went under lockdown, video conferencing capabilities became more vital than ever for both business and personal interactions. Zoom has certainly benefited from this need. The telecom company’s third-quarter revenue surged to $777.2 million, up 367% year over year, the company reported.
Zoom continues to grow its subscriber base, reporting a 485% increase (year-over-year) in customers with more than 10 employees, to 433,700.
More From GOBankingRates
- Money’s Most Influential: Where Do Americans Get Their Financial Advice?
- Everything You Need To Know About Taxes This Year
- ‘Rich Dad Poor Dad’ Author Robert Kiyosaki: You Should Never Say ‘I Can’t Afford That’
- Here’s How Much You Should Have in Your 401(k) Account, Based on Your Age
George Malone contributed to the reporting for this article.