Market Overview

Apple Reportedly Laying Off Significant Numbers of Retail Employees


According to a MacRumors report on Monday, Apple (NASDAQ: AAPL) has been laying off a number of recent hires in its stores. After having come under fire for the treatment of its retail employees, the company has attempted to mend its relationship with rolling salary increases.

However, MacRumors claims that all employees at an Apple store in the U.K. who had less than 6 months of experience had been laid off. MacRumors also reported that a number of newly hired employees have been laid off, while several more experienced employees did not receive their pay increases following promotion.

Also, three training groups had been laid off in their entirety in the last week, according to MacRumors. Furthermore, Apple retail store staffers in the U.S. and Canada have received significantly reduced hours for the past several months, with some staff having their hours cut down all the way to zero.

This has brought up questions about Apple's retail operation in general. Specifically, investors might question whether or not it's beginning to fail. Some speculation places blame on Apple's current battle with Samsung -- both the titanic legal battle between the two and Samsung's stellar performance with its Galaxy S3. According to PC World, Samsung's smartphone shipments are now more than double Apple's.

Further worries surfaced about retail electronics in general after recent turbulence experienced by Best Buy (NYSE: BBY).

More questions about Apple have been raised after a rare earnings miss in July, when iPhone sales fell by 26 percent. Following this hiccup, however, Apple has successfully rebounded, and shares are back trading near an all time high.

Many experts expect the iPhone 5 to be released next month, yet Apple is still dropping retail employees. This could point to low expectations for the new iPhone's sales, or could just be related to a recent report by Strategic Analytics which pointed towards slowing growth in smartphone sales in the third-quarter quarter.


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Posted-In: News Retail Sales