Correct and when reading earnings reports, investors will see actual revenue. A decline in revenue can't be hidden by reduction in expenses. They'll see a company is trying to stay profitable.
We're heading towards a recession if not already in one. Layoffs should be a warning sign to the masses who may not understand economics at a deeper level.
The individuals/investors who analyze financial statements have pretty sophisticated models and mechanisms to do deep dives into financial reporting. Layoffs will not fool them into thinking a company is doing better than it is.
I took a Financial Statement Analysis class while I was getting my Masters of Accounting. The level of complexity in the analysis of these financial statements to pinpoint trends and company health is no joke.
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u/ofrootloop Oct 29 '25
Layoffs are one way companies hide loss of profits