Apple hasn’t grown its headcount as aggressively as other big tech companies in the past two years. Brian Ach/Getty Images for TIMEWith Meta, Amazon, Google and Microsoft laying off tens of thousands of employees in recent months, Apple is alone among the biggest U.S. tech companies in not announcing major layoffs. Is the iPhone maker’s business really sound enough to be immune to job cuts or are layoffs inevitably coming? That’s one of the questions analysts are eager to hear Apple CEO Tim Cook address on the company’s upcoming quarterly earnings call on Feb. 2.
For now, opinions are divided on Wall Street. Tom Forte, a senior research analyst at DA Davison, an investment bank, said Apple will have to cut headcount to adjust for falling demand for its devices and services but it could do so in a less obvious way. In an interview on Bloomberg TV on Jan. 30, Forte pointed out Apple has been aggressively demanding employees to return to the office in the past year, which could have led to voluntary resignations. “Apple could cut [headcount] through attrition, much like Amazon did,” he said.
Wedbush Securities’ Dan Ives disagrees. “We believe iPhone demand [is] holding up firmer than feared,” he tweeted on Jan. 29. “Apple remains in a unique situation to withstand this economic storm better than its tech peers. Apple will likely cut costs but we do not expect mass layoffs from Cupertino this week.”
Most of the layoffs at big tech companies in recent months were a result of over-hiring during the pandemic, but Apple never had this problem. “Apple never hired at the pace of these other tech giants,” Ives said on Yahoo Finance Live Jan. 30. “I think it just shows why Cook is a Hall of Fame CEO. I think he’s able to navigate another situation here in terms of not needing to do the layoffs that other tech firms have done.”
Apple has an army of employees, but none in manufacturing
Apple currently has about 164,000 full-time employees, according to its latest disclosure in October 2022. About 40 percent of Apple’s staff work in its retail stores around the world. Apple doesn’t employ its own manufacturing workforce, so any demand-triggered job cuts will first affect its suppliers, such as Foxconn.
From its fiscal year-end in September 2019 to September 2022, Apple’s grew its workforce by only about 20 percent, while Microsoft and Google grew more than 50 percent and Amazon and Meta doubled their headcount during the same period, according to data compiled by the Wall Street Journal.
Meanwhile, Apple’s core business—iPhones and computers—has proved to be resilient despite market downturns while Meta and Google saw their advertising revenue slide. In its most recent quarterly earnings report in October, Apple posted record profit and revenue for the three months ended September, beating analyst expectations.
For the three months ending in December, analysts expect the iPhone maker to post a revenue of about $122 billion, the same level as last year, and an earnings per share between $1.71 and $2.17.
Apple is set to report earnings on Feb. 2 after market close.
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