Apple, ServiceNow avoid job cuts amid mass tech layoffs

Yahoo Finance’s Ines Ferré discusses why companies like ServiceNow and Apple have managed to avoid laying off workers so far as a slowdown hits the tech sector.

Video transcript

DAN HOWLEY: Well, despite the thousands of layoffs rattling the tech industry, there are a few companies who have avoided the carnage. Yahoo Finance's own Ines Ferre joins us now with the details.

INES FERRE: Yeah, Dan, and they are hard to find, but I will say that if you take a look at ServiceNow, this is a cloud software company that recently reported its quarterly results and, in fact, went out of its way to say we are not cutting jobs in 2023. We are not laying people off. Well, ServiceNow CFO Gina Mastantuono spoke with Brian Sozzi and Julie Hyman in Davos last week. And she said that, certainly, they have slowed down hiring a bit, but they're still continuing to grow. And in fact, when other tech companies have laid off people, well, this has been an opportunity for companies like ServiceNow. Take a listen.

GINA MASTANTUONO: The market right now is interesting for sure. And the ability to snap up some great talent is better today than certainly the last year. So we're taking advantage of that for sure.

INES FERRE: And she also talked about the digital transformation. And this is at the forefront of companies, and also saying that they are now hiring. Their priority is on sales and engineering talent, Dan.

RACHELLE AKUFFO: So, Ines, a question here. I mean, besides ServiceNow, Apple has also been able to avoid cuts. We tapped on that a little bit, but why is that?

INES FERRE: Yeah, and part of this has to do with the rate at which it hired during the pandemic compared to other big tech companies. So Apple has been very disciplined at this. And if you take a look at the data from September 2019 to September 2022, Apple's headcount grew by 20%. And by comparison, you've got Microsoft, their headcount grew by more than 50%. Alphabet's the same.

And in the last two recessions, Apple hasn't had to have mass layoffs. So it's a company that is disciplined with its count with the rate at which it's growing. And so therefore it's able to avoid laying people off, at least, on a mass scale for now, even if there are reports that they may be slowing down their hiring. The last time that Apple had a mass layoff was in 1997 when it laid off about 4,100 workers.

RACHELLE AKUFFO: Wow, 1997. Great stuff. Ines, thank you so much.