(Bloomberg) -- The outlook for small and mid-cap technology firms is much brighter than for their mega peers, according to UBS Global Wealth Management.

Ahead of quarterly results due later on Thursday from giants Apple Inc. and Amazon.com, strategists led by Mark Haefele said smaller tech companies offer investors better opportunities due to their superior growth prospects and reduced exposure to regulatory risks.

Potential headwinds for bigger organizations include China’s pledge to create a “civilized” internet, and persistent tensions between Beijing and the U.S. over national security, the strategists said. 

Their warning comes just as Facebook Inc. faces more scrutiny over allegations that it misled investors and consumers about harms and declining users on its platform. Its shares are down 18% from their September high.

The strategists see particularly strong growth potential in subscription-based technology companies, forecasting that the subscription economy will expand into a $1.5 trillion market by 2025, from $650 billion in 2020, implying an average annual growth rate of 18%.

“With 25% annual revenue growth forecast from 2020 to 2025, e-commerce subscriptions top the ranks of subsectors,” the strategists said.

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