Apple is the only Big Tech company that has not cut its workforce.
The tech industry has been consolidating, with a wave of layoffs starting last November. The massive job cuts in the sector reflect expectations that revenue growth will slow as the economy contracts.
Alphabet's Google (GOOGL), the search and cloud giant, said on Friday it would cut 12,000 employees globally. Amazon (AMZN) plans to shrink its workforce by 18,000 while Microsoft (MSFT) cut 10,000 employees. Meta Platforms (META) eliminated 11,000 people, or 13% of its headcount, in November.
Tech stocks took a beating last year. One example: Meta, parent of Facebook and Instagram, lost 56% of its market capitalization. Investors sold off their shares as fears of a potential recession persist amid a higher interest rate environment.
Apple (AAPL) did not go on a hiring spree during the past two years -- unlike other tech giants. Microsoft had hired about 75,000 people since 2019.
Apple's staff grew by 10,000 people through September 2022, the end of its fiscal year. The addition brought its headcount to 164,000, including corporate staff and employees at its brick-and-mortar stores.
The number of employees in 2022 rose just 6.5% from the year-earlier period. In 2020, Apple took on around 7,000 employees.
Apple Stock a Buy, Evercore Analyst Says
Ahead of Apple reporting the iPhone and Macbook manufacturer's earnings on Feb. 2, Evercore ISI analyst Amit Daryanani says investors should add the tech company to their portfolios, media reports say.
Both Apple and International Business Machines (IBM) were included on Evercore’s “Tactical Outperform List,” companies the firm expects will produce strong near-term earnings.
Apple's stock is a “compelling buying opportunity” after pressure in the past few weeks when analysts lowered revenue expectations for the iPhone 14 Pro and Pro Max. They acted because of China's production issues from its recent covid-related regulations.
While Apple's shares have sold off and underperformed the S&P 500 by 16 percentage points since it reported earnings in October, sales should rebound this spring, Daryanani says.
IPhone sales from the December quarter could fail to meet estimates, but “a miss shouldn’t have a material impact" on the shares if Apple's guidance proves correct, that it will make up the shortfall in units in coming quarters, the analyst said, according to Barron's.
Daryanani estimates that Apple's March-quarter guidance will be 5% ahead of the current Wall Street consensus because sales of iPhones have started to rise. He maintained his outperform rating on Apple with a price target of $190.
For its September 2022 quarter, Apple's results were slightly better than expected as iPhone sales came in lighter than expected while the Mac unit was strong.
Apple's sales during the quarter rose 8% from a year earlier to $90.1 billion. Earnings rose 4% to $1.29 a share. Wall Street analysts had predicted profit of $1.27 a share on revenue of $88.9 billion.
Through the close of trading Jan. 20, Apple stock is off a bit less than 15% in the past year. In the first three weeks of 2023, the stock is up 6.1%.
