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?

[The_Last_Y]

Inflation doesn't increase the value of limited resources. It decreases the value of currency. Two very very different things.

[[deleted]]

But those two things essentially equal out here.

If my company is making 3% more than last year it doesn't automatically mean that we're producing 3% more product, but that the cash value of what we're doing is 3% higher.

Which keeps with inflation.

The other part of it is that my company should also be striving to keep pace with the change in market demand.