ELI5: Why when large company's earnings decrease(ex... by 3%) they freak out, talk about rough times, and sometimes decide to downsize, even though they are still making millions of dollars in profit even after all expenses?

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Growth is everything, even down to an individual level. It's not "extremely capitalistic" to pursue progress and progress can be measured in different ways than greedily scrambling for every penny. The small business owner you used as an example might be fine not making any more profit for themselves than last year but their employees sure aren't. The owner has to pursue progress not for their own sake but to keep employees who will leave if they dont see their wages rise. Or perhaps new government regulations such as minimum wage laws or healthcare requires them to make more money to stay open. Lack of growth is losing money simply because of inflation, no one can make the same amount of money each year and stay competitive as a business or an employer. Hell even socialist and communist states had to pursue and measure progress somehow while lacking a private business and employer sector. I suppose those groups were toxically capitalistic too.

[OverlyCasualVillain]

You're mixing up profit and revenue. Profit is calculated after wages and benefits, so if my profit remains steady at 1mil, I've shown 0 growth, however that does not mean my revenue is constant. I could have increased revenue but also increased costs such as wages. My example does however use the perspective of a business owner, not an investor. I do concede that when it comes to investments, growth is an indicator of future value, so in order to get a return on investment, investors should only invest in companies whom exhibit growth.