Amazon, Facebook and Google could save billions thanks to the GOP tax bill

jeff bezosEvan Vucci/AP

  • Cowen estimates that Amazon, Google and Facebook will save a combined $ 4.5 billion on taxes in 2018 thanks to the GOP tax bill.
  • They should also benefit from the bill’s capex expensing provision.

The GOP tax bill has long been expected to boost corporate profits. Now we know just how much the biggest tech companies in the US stand to save — and what that could mean for their bottom lines.

Google will save $ 2.28 billion in 2018, while Facebook will see $ 1.56 billion in savings and Amazon will enjoy a $ 723 million break, according to estimates from Cowen senior research analyst John Blackledge.

The firm forecasts those savings will translate to big earnings-per-share (EPS) boosts for each company, with Amazon the big winner, boasting an expected upside of 24%. Google and Facebook will both get an EPS bump of 8%, Cowen said.

Screen Shot 2017 12 07 at 11.02.43 AMCowen

For context, the Cowen’s analysis is based on three assumptions: (1) the US corporate tax rate goes to 22% from 35% on January 1, 2018, (2) there are no changes to international taxes, and (3) there’s no impact from other aspects of the tax bill.

But the good news for the mega-cap tech triumvirate doesn’t end there. Cowen sees Google, Facebook and Amazon also benefiting from the proposed capital expenditure expensing provision in the GOP tax bill. The firm estimates that the companies will spend a combined $ 234 billion on capex from 2018 to 2022, noting that Facebook has said it plans to double reinvestment in 2018.

So there you have it — three of the hottest tech firms in the US look poised to keep adding to their dominance, all thanks to the GOP tax bill. Bet against them at your own peril.

NOW WATCH: We talked to the bond chief at the $ 6 trillion fund giant BlackRock about the most important issue for markets right now


Post Author: martin

Martin is an enthusiastic programmer, a webdeveloper and a young entrepreneur. He is intereted into computers for a long time. In the age of 10 he has programmed his first website and since then he has been working on web technologies until now. He is the Founder and Editor-in-Chief of and Online Magazines. His colleagues appreciate him as a passionate workhorse, a fan of new technologies, an eternal optimist and a dreamer, but especially the soul of the team for whom he can do anything in the world.

Leave a Reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.