Apple released their earnings today.
Sales clearly slowed down versus LY's quarter. The trailing four quarters of earnings per share showed a slowdown as well.
Apple embraces a culture of not laying off people. I've always considered this a favorable characteristic of a quality company. Sure, it hits the profit and loss when sales slow, but it keeps quality people working for the company and aligns their interests with those of the firm.
The "knowledge industry" (computing) has significant assets in their employees. The traditional hard assets are much less in these types of organizations. Often referred to as "asset light" some analysts perceive this aspect as a favorable characteristic because people can be reduced much easier than shedding traditional assets. Bad idea!
Keeping quality people during difficult times enables profits to ramp up much more quickly when economic circumstances change. For companies who don't espouse this concept, they suffer extensive training costs which are very expensive and can take a long time to acquire.
So instead of painting a favorable quarterly earnings "picture", the short term P&L pain will enable much more robust profit performance when the economic winds change.
Be smart, be well-read, be aware and be successful.
"When you appreciate your employees, they will reciprocate it a thousand times."
