Executive departures at Five9 and Zscaler and investors' continued rotation out of risk combined to send the group to its lowest level in over a year.
The WisdomTree Cloud Computing Fund, a basket of 75 cloud software stocks, has lost more than half of its value for the year. After soaring in 2020 and 2021, when Wall Street piled into growth at the expense of profit, the sector has fallen out of favor.
The biggest decline in the index was suffered by Five9 shares, which fell 29% for the week. The provider of call center software pre-announced third-quarter revenue that indicated results would be better than expected and the numbers weren't good enough to offset the concern caused by a transition in the C-suite
Mike Burkland stepped down as CEO after he was diagnosed with cancer.
The lack of clarification from Five9 until the earnings call next month has caused confidence in the name to beshaken. The firm still believes in the stock.
Five9 was one of the companies that lost a top executive. The president of Zscaler resigned to take a CEO position at a pre- IPO company. For the week, the stock plummeted.
This change will not impact Zscaler's near- or long-term prospects, and it appears to be a unique opportunity for Mr.
There was a selloff in the markets on Friday. A consumer survey from the University of Michigan shows that inflation expectations are increasing, which is good news for the Federal Reserve. Growth companies are more sensitive to interest rate increases.
The WisdomTree index had its worst day of the week on Friday. Even though there was no particular news that drove the decline, the company's stock dropped 22%. GitLab was down 21%. GitLab went public in a high-profile IPO. Each of them has lost more than half their value.
The cloud's efficiency poses a threat to hardware.
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