Apple has so far acted as an exception among the US tech giants, not announcing any job cuts. An exception that may be temporary. The Cupertino company may indeed be forced to lay off employees en masse.
News: Apple, Amazon, Meta and Alphabet will present their quarterly results this week.
- Announcements that investors are looking forward to as they set the tone for the strategies of these big tech companies in the coming months.
- The results could also be an opportunity for these companies to announce new layoffs.
Detail: Apple may tune in and announce job cuts.
- The apple firm has been somewhat spared so far – even if Apple has lost more than $800 billion in the stock market in 2022 – compared to its peers in the sector. In any case, he has not announced any restructuring within his teams.
- However, given that the smartphone market experienced its worst year since 2013, including its worst-ever downturn during the industry’s traditional holiday season, and that the iPhone accounts for the majority of product sales, analysts expect Apple’s results for this period will be higher. be disappointing.
- Enough to push the company towards harmony and a downward revision of the workforce.
“As with other major tech companies, we expect Apple to adapt its workforce to reflect increasingly challenging global macro conditions.”
Tom Forte, Analyst at DA Davidson
However, an opinion not shared by everyone. According to Daniel Ives, an analyst at Wedbush, Apple would rather cut certain costs than cut its ranks, at least for now.
Background: In 2022, the stocks of large US technology companies have declined, so most of them have already announced layoffs, as well as budget cuts.
- Investors are waiting for signs of a reversal and more optimistic forecasts for the year ahead, although last week’s results from Microsoft and Tesla – positive, but with pessimistic forecasts – did not bode well for their counterparts.
- After several years of growth driven by the coronavirus pandemic, Big Tech has found itself in uncharted territory due to a slowdown in demand for products, both digital, electronic and advertising.
- And for some analysts, the fall is not over yet.
New wave of layoffs possible
In addition to tone for the next few months, Amazon and Alphabet, which have already cut their teams significantly, may announce further cuts.
- The challenges these companies face in 2022 should continue to slow them down for some time to come.
- The post-Covid slowdown will continue, leaving them to regret their exaggerated ambitions during the pandemic that pushed them towards revenge.
- For Google, this is primarily a turmoil in the online advertising sector, which should hurt him.
Dark days for the Meta
Amazon and Alphabet won’t be the only ones to continue to suffer in 2023. Mark Zuckerberg’s empire, which suffered a particularly brutal fall last year, is likely to face even darker days in the coming months, according to several analysts.
“In 2023, we expect the Meta to continue to engage in tough battles within the octagon. In the long term, we believe Meta will benefit from the age-old trend of digital advertising and innovation in the metaverse; however, regulatory scrutiny remains, internal hurdles remain, and we believe the darkest days of this downturn are yet to come.”
Monness Crespi Hardt analyst Brian White in a research note.
Beyond big tech
The macroeconomic context does not only bring casualties within Big Tech, the entire sector suffers and even beyond.
- Last week, IBM announced its intention to lay off 3,900 people during the presentation of its results, and this despite the fact that the company has already laid off 20% of its workforce during the pandemic.
- The semiconductor sector may also follow as the chip shortage has turned into a surplus. Several industry players have already announced their layoffs.