Apple Inc. has taken the rare step of laying off around 100 employees in its digital services department, according to sources familiar with the matter as reported by Bloomberg.
In recent years, the services sector has become a growth engine for Apple. The latest round of layoffs is part of a shift in priorities for the tech giant in this crucial division.
Apple informed the affected employees on Tuesday (August 27) that they have 60 days to find another job within the company before being laid off. Some employees work across multiple teams, so other areas have also been indirectly impacted.
The layoffs include some engineering positions, with the teams responsible for the Apple Books app and Apple Bookstore being the most affected. Other service teams have also seen reductions, including those responsible for running Apple News.
The exact number of employees in Apple’s services department is currently unclear. According to its latest annual report, as of September 30, 2023, the company had approximately 161,000 full-time employees.
For Apple, the priority of Apple Books has been lowered, and it is no longer a primary component of the company’s service lineup.
Sources told Bloomberg that over time, the Apple Books app may still receive new features. As for Apple News, the layoffs do not signal a lack of emphasis on the platform.
An Apple spokesperson declined to comment on the layoffs to Bloomberg.
Apple has been restructuring its teams to adapt to changes in its priorities. Earlier reports stated that Apple had halted the development of its next-generation high-end Vision head-worn device and had shut down a project to design and develop a smartwatch display earlier this year.
Since last year, Apple has faced challenges in its third-largest market, China, with a 6.5% year-on-year revenue decline in the second quarter of this year in the Greater China region.
News of layoffs at major tech companies has been frequent in the past two years. On August 1, U.S. chipmaker Intel announced plans to cut costs and reduce its workforce by over 15% while suspending dividends starting in the fourth quarter as it seeks to turn around its struggling manufacturing business.
In addition to Apple, tech giants such as Alphabet, Amazon, Meta, Microsoft, eBay, Unity Software, SAP, and Cisco have all been involved in layoffs this year.