Foxconn, the world’s largest contract electronics manufacturer, reported a better-than-expected 6% increase in quarterly net profit, fueled by surging demand for artificial intelligence (AI) servers. The Taiwanese company, formally known as Hon Hai Precision Industry Co Ltd, emphasized its strong position in the AI server market, which has become a key growth driver for the company.
The company’s net profit for the April-June quarter reached T$35.05 billion ($1.09 billion), surpassing analysts’ expectations of T$34.29 billion. This marks the fourth consecutive quarterly profit rise for Foxconn, driven largely by its expanding AI server business. The company reported that AI servers accounted for more than 40% of its server business in the second quarter and forecasted that AI servers would soon become Foxconn’s next trillion-dollar revenue product in Taiwan dollar terms.
James Wu, Foxconn’s vice president and spokesman, highlighted the company’s leadership in the AI server market, noting that it holds over 40% of the global market share. Wu stated, "If the schedule remains unchanged, the performance of the entire AI server segment may be better than originally estimated." He also expressed confidence in Foxconn’s technological edge, asserting that the company’s capacity and technology would not be easily challenged by competitors, saying, "That will not be changed in a short time."
Foxconn’s optimism extends into the fourth quarter, with expectations of continued robust demand for AI servers. The company revealed that the development schedule for Nvidia’s GB200 chip, a leading AI semiconductor, was on track, with product delivery expected to start in small volumes in the fourth quarter and ramp up in early 2025.
In addition to its AI server business, Foxconn is looking to replicate its success in iPhone manufacturing within the electric vehicle (EV) sector. The company mentioned ongoing talks with two traditional Japanese carmakers, which are expected to be finalized this year. However, Foxconn provided a cautious outlook for its smartphone business, predicting that revenue would remain flat for the third quarter but improve in the second half of the year compared to the same period in 2023.
As Foxconn anticipates growth in the second half of the year, KGI Securities revised its sales forecast for the company, citing strong demand for new iPhones and AI servers as key factors supporting a better-than-expected outlook. Ahead of the earnings announcement, Foxconn’s shares closed up 2.5%, reflecting investor confidence in the company’s growth prospects.
(Source:www.reuters.com)
The company’s net profit for the April-June quarter reached T$35.05 billion ($1.09 billion), surpassing analysts’ expectations of T$34.29 billion. This marks the fourth consecutive quarterly profit rise for Foxconn, driven largely by its expanding AI server business. The company reported that AI servers accounted for more than 40% of its server business in the second quarter and forecasted that AI servers would soon become Foxconn’s next trillion-dollar revenue product in Taiwan dollar terms.
James Wu, Foxconn’s vice president and spokesman, highlighted the company’s leadership in the AI server market, noting that it holds over 40% of the global market share. Wu stated, "If the schedule remains unchanged, the performance of the entire AI server segment may be better than originally estimated." He also expressed confidence in Foxconn’s technological edge, asserting that the company’s capacity and technology would not be easily challenged by competitors, saying, "That will not be changed in a short time."
Foxconn’s optimism extends into the fourth quarter, with expectations of continued robust demand for AI servers. The company revealed that the development schedule for Nvidia’s GB200 chip, a leading AI semiconductor, was on track, with product delivery expected to start in small volumes in the fourth quarter and ramp up in early 2025.
In addition to its AI server business, Foxconn is looking to replicate its success in iPhone manufacturing within the electric vehicle (EV) sector. The company mentioned ongoing talks with two traditional Japanese carmakers, which are expected to be finalized this year. However, Foxconn provided a cautious outlook for its smartphone business, predicting that revenue would remain flat for the third quarter but improve in the second half of the year compared to the same period in 2023.
As Foxconn anticipates growth in the second half of the year, KGI Securities revised its sales forecast for the company, citing strong demand for new iPhones and AI servers as key factors supporting a better-than-expected outlook. Ahead of the earnings announcement, Foxconn’s shares closed up 2.5%, reflecting investor confidence in the company’s growth prospects.
(Source:www.reuters.com)
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