Apple avoiding layoffs by cutting travel budget, delaying bonuses and more

Apple is the only major tech giant which has not resorted to mass layoffs to cut expenses. However, it appears the iPhone maker is trying its best not to go down the path rival firms like Microsoft, Meta, Google, and Twitter have taken by adopting some strict cost-cutting measures. In the last financial quarter (October to December 2022), Apple posted a revenue of $117.2 billion, down 5 per cent year over year. The company may see growth in the current quarter as iPhone 14 Pro and 14 Pro supply issues have been solved, but one cannot be sure given the macroeconomic challenges.

According to Apple analyst and Bloomberg's Mark Gurman, Apple's top executives are seen as some of the most tactical minds in the industry. In his latest edition of the Power On newsletter, he states that layoffs would either signal that they'd made a strategic blunder or that the global economy is in even worse shape than people feared. Recently, it was reported that Apple is delaying bonuses for some corporate employees and limiting its hiring. Other measures include:

--Apple is reportedly delaying the production of the new-gen HomePod with the screen until next year. The company likely wants to allocate "its research and development budget to more pressing projects."
--As mentioned, some corporate teams will receive the budget later. Apple also doles out bonuses and promotions twice a year to some teams, depending on their performance. This year, the company will delay their April promotion, which employees will receive directly in October.
--Apple has also paused hiring for some teams, and departments are operating on strict budgets. The newsletter notes that the company has reined in budgets across several teams and is now requiring the senior vice president's approval for more items. Additionally, the company is not yet filling open positions.
-Additionally, employees' travel budgets have been "significantly reduced."
--Managers and HR have reportedly become as strict as ever about office attendance. At least Apple's main US division is operating in a hybrid model where employees have to come to the office thrice a week.
--Lastly, the newsletter indicates that Apple retail store employees are also having a tough time. The company is also getting rid of "special sick time" for time missed due to COVID-19. Retail employees now have to use regular sick leaves to mark absent days.

Gurman adds that Apple may bounce back with its new tablets and with the introduction of mixed-reality headsets. Apple was also conservative with its hiring during the pandemic. On the other hand, Apple's top rivals have laid off more than 50,000 employees in recent months.