Apple is reportedly planning to slow hiring and spending growth next year to cope with an economic downturn, which would place it in the company of American tech companies including Facebook, Amazon and Google in enacting similar measures.
The changes, first reported by Bloomberg, would not affect all teams, and Apple is reportedly still planning a major product launch scheduled for next year that includes a mixed-reality headset, its first significant new category since the Apple Watch in 2015.
While Apple has not confirmed its plan to slow hiring, the report comes as earnings season enters full-swing. Late Tuesday, Netflix is expected to announce a sharp fall in subscribers, indicating in part that consumers are cutting back on discretionary spending as consumer confidence plummets in a highly inflationary environment.
Last week, Google announced it will slow down hiring for the remainder of the year. In a memo to employees, chief executive Sundar Pichai said the company would have to “be more entrepreneurial” and for employees to work with “greater urgency, sharper focus, and more hunger than we’ve shown on sunnier days”.
Earlier, Microsoft said it planned to cut some jobs as it realigned business groups but overall expected to increase its headcount. “We will continue to invest in our business and grow headcount overall in the year ahead,” the company said.
Facebook parent Meta Platforms has also announced a hiring reduction in some high-level positions as it seeks to cut expenses by $3bn this year.
In June, it was reported that Tesla’s chief executive, Elon Musk, had a “super bad feeling” about the US economy and was determined to cut about 10% of the auto company’s workforce and to “pause all hiring worldwide”.
Other winners during the pandemic economy have also announced layoffs, including Peloton and Netflix, which laid off 300 employees as it seeks to re-engineer its business as subscribers cancel subscriptions.
Apple, with 17% of the smartphone market, reports its earnings on 28 July, when investors will get a more complete picture of supply chain problems and any sign of a slowdown in consumer demand for products and services that have made it the world’s most valuable company.
“Apple’s move reflects a broader slowdown in investing in new things, new companies and new products,” Kim Forrest, chief investment officer at Bokeh Capital Partners, told Reuters. “It signifies that inflation is an issue for these companies.”