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Apple plans to pull back on hiring as a result of slower iPhone sales

Published Jan 16th, 2019 5:42PM EST
Apple hiring slowdown
Image: Isopix/Shutterstock

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Apple is continuing to feel more ramifications from the economic slowdown in China that the iPhone maker has previously blamed for the downward revision in its holiday quarter guidance. The company, as we and other outlets have reported, has also been cutting iPhone prices for retailers in China, but now comes word that Apple also plans to slow down the pace of its hiring in some parts of the company.Apple CEO Tim Cook acknowledged the company’s issues while meeting with employees the day after writing the bombshell letter he addressed to investors that disclosed the recent struggles related to China. During that internal meeting, according to a Bloomberg report, someone asked Cook if the company might implement a hiring freeze. Cook countered that some divisions within the company would see a hiring slowdown instead, rather than a complete freeze.

Per the Bloomberg account, Apple’s CEO hasn’t made up his mind yet on which divisions are going to have to pull back on hiring. He also reportedly stressed during the meeting that hiring rates aren’t an indicator of how important a division is to the company and that some units, like Apple’s artificial intelligence division, are going to keep adding employees “at a strong pace.” In a memo addressed to employees, Cook wrote that “this moment gives us an opportunity to learn and to take action.”

Apple added about 9,000 employees during its most recent fiscal year, bringing the total to 132,000 employees.

To be sure, the struggles Apple is dealing with aren’t completely the result of what’s going on in China, which include a tightening economy there and tensions related to the US trade war. Apple has also made clear that iPhone upgrades have been slower than expected in some key markets. This is one reason the company has been heavily promoting the services side of its business compared to its hardware, with Tim stressing on multiple occasions that the part of Apple that includes services ranging from Apple music to iTunes will have grown to $10.8 billion in sales during the holiday quarter.

This news also is a bit of a departure, though, from the celebratory headlines that greeted Apple just a few months ago, when the iPhone maker become the first publicly traded company in the US to be worth $1 trillion in terms of stock market capitalization. Since then, Apple has shed almost $300 billion in its valuation.

Andy Meek Trending News Editor

Andy Meek is a reporter based in Memphis who has covered media, entertainment, and culture for over 20 years. His work has appeared in outlets including The Guardian, Forbes, and The Financial Times, and he’s written for BGR since 2015. Andy's coverage includes technology and entertainment, and he has a particular interest in all things streaming.

Over the years, he’s interviewed legendary figures in entertainment and tech that range from Stan Lee to John McAfee, Peter Thiel, and Reed Hastings.