plan Apple to slow hiring and spendingduring the next year in some departments to deal with a possible economic downturn, according to what “Bloomberg” quoted sources with, and was seen by “Al Arabiya.net”.
The sources said the decision is proactive to hedge during turbulent times, although it is not a corporate-wide policy.
The changes won’t affect all teams, and Apple is still planning a solid product launch schedule in 2023 that includes an augmented reality headset, its first new flagship category since 2015.
Apple shares fell 2% to $147.20, after Bloomberg reported the slowdown, adding to the 17% year-to-date decline.
It comes as Alphabet, Amazon, Meta Platforms, Snap, and other tech companies have taken their own steps in recent weeks to rein in budgets and slow hiring.
Companies such as Microsoft, Tesla, and Meta have gone so far as to cut jobs, something Apple has not historically done.
Apple, headquartered in Cupertino, California, allocates a certain amount of money to each major department each year to spend on research, development, resources and staffing.
For 2023, selected teams are given a lower budget than expected.
As for some groups, the company will not increase the number of employees in 2023, while it may usually hire 5% to 10% more employees in a given year, and also plans to not fill the roles of departing employees for some groups.
On the other hand, analysts expect Apple to report third-quarter revenue of about $83 billion, slightly higher compared to the same period last year, when it releases its results on July 28.
During the recent earnings call, Apple CEO Tim Cook said the company was “blowing out and the impact was evident in gross margin and operating expenses.
The company also cited the ongoing negative impact of COVID-19 and rising shipping costs, refusing to provide specific revenue guidance.
Apple allocated about $22 billion for research and development in the 2021 fiscal year, an increase of 17% from the previous year, when the company at the end of 2020 had about 154,000 employees.
In 2021, Apple’s capital expenditures exceeded $11 billion, a 52% increase from 2020, while total operating expenses – which include spending on marketing, salaries and equipment costs – rose 13% last year to about $44 billion.