Foxconn and TECO Form Strategic Alliance to Dominate AI Data Center Market

Taiwan's Foxconn partners with TECO to build AI data centres

TAIPEI, July 30 (Reuters) - Taiwan's Foxconn (2317.TW), opens new tab, the world's largest contract electronics maker, will form a strategic partnership with industrial motor maker TECO Electric & Machinery (1504.TW), opens new tab to boost development in the AI data centre market, they said on Wednesday. The move underscores Foxconn's efforts to expand beyond its traditional role as an iPhone assembler as it taps opportunities in the artificial intelligence infrastructure market, from supplying AI server racks to data centre businesses. Under the deal, Foxconn will hold a 10% stake in TECO, which will hold about 0.519% of Foxconn, they said, adding at a press conference that the partnership's target market extends beyond Taiwan and Asia to the U.S. and Middle East. The companies aim to accelerate global data centre development by combining Foxconn's expertise in servers, cooling systems and uninterruptible power supplies with TECO's experience in data centre power infrastructure, they said. TECO Electric & Machinery Co (1504.TW), opens new tab is Taiwan's top industrial motor maker and ranks among the world's top five suppliers of small low-voltage and medium- to high-voltage motors. It also produces motors for electric vehicles. The company has provided mechanical, electrical and plumbing engineering services for data centre infrastructure for more than a decade, it said, specialising in power infrastructure outside the server room. "This is where Foxconn and TECO can jointly extend the value chain. Accelerating data centre construction will also help expand the server rack market," said Foxconn spokesperson James Wu. "Taiwan's strength in AI lies in its vertical integration, design capabilities, and production scale... (the) Foxconn-TECO partnership would result in faster, more cost-efficient solutions." The news comes after Apple (AAPL.O), opens new tab and Nvidia (NVDA.O), opens new tab supplier Foxconn halted trading in its shares on Wednesday. TECO also halted trading in its shares. TECO entered Malaysia's data centre infrastructure market this year with the acquisition of an 80% stake in NCL Energy. In July, the company said it had secured major data centre projects in the Malaysian states of Selangor and Johor Bahru. Foxconn, officially called Hon Hai Precision Industry, has a big AI server business and is actively expanding its electric vehicle business. It has also been seeking partnerships with automakers and within the automotive supply chain. The Taiwan technology giant this month reported record second-quarter revenue on strong demand for AI products but cautioned about geopolitical and exchange rate headwinds. Reporting by Lee Wen-Yee; Writing by Brenda Goh; Editing by Anne Marie Roantree, Clarence Fernandez and Jan Harvey Our Standards: The Thomson Reuters Trust Principles., opens new tab

Taiwan's Foxconn, TECO Electric to form strategic partnership

TAIPEI, July 30 (Reuters) - Taiwan's Foxconn (2317.TW), opens new tab, the world's largest contract electronics maker, and Taiwan industry motor maker TECO Electric & Machinery will form a strategic partnership and work together to set up data centres, the companies said on Wednesday. Under the deal, Foxconn will hold a 10% stake in TECO, which will hold about 0.519% of Foxconn, the companies said, adding at a press conference that the partnership's target market extends beyond Taiwan and Asia to the United States and Middle East. The news comes after the Apple (AAPL.O), opens new tab and Nvidia (NVDA.O), opens new tab supplier halted trading in its shares late on Tuesday, pending an announcement. TECO also halted trading in its shares. TECO Electric & Machinery Co (1504.TW), opens new tab is Taiwan's top industrial motor maker and ranks among the world's top five suppliers of small low-voltage and medium- to high-voltage motors. The company also produces motors for electric vehicles. TECO entered Malaysia's data centre infrastructure market this year with the acquisition of an 80% stake in NCL Energy. In July, the company said it had secured major data center projects in the Malaysian states of Selangor and Johor Bahru. Foxconn, formally called Hon Hai Precision Industry, has a big artificial intelligence server business and is actively expanding its electric vehicle business. It has also been seeking partnerships with automakers and the supply chain. The Taiwan technology giant this month reported record second-quarter revenue on strong demand for artificial intelligence products but cautioned about geopolitical and exchange rate headwinds. Reporting by Lee Wen-Yee; Writing by Brenda Goh; Editing by Anne Marie Roantree and Clarence Fernandez Our Standards: The Thomson Reuters Trust Principles., opens new tab

iPhone maker Foxconn joins $1 trillion AI data center market with new alliance

Foxconn Hon Hai Technology Group signage during the Nvidia GPU Technology Conference (GTC) in San Jose, California, US, on Thursday, March 20, 2025. Foxconn on Wednesday said it is taking a stake in TECO Electric & Machinery Co., a move that will looks to supercharge its efforts to become a key player in building artificial intelligence data centers. The Taiwanese firm, formally known as Hon Hai, is looking to replicate the success it has had in consumer electronics in the world of AI. It's a play that could unlock Foxconn's access to a potential $1 trillion of spending by companies on data centers in the coming years, according to Counterpoint Research, and will also pit the Taiwanese giant against companies like ABB, Siemens and Mitsubishi Electric. Foxconn will take a 10% stake in TECO as the result of a share exchange. TECO started life as a engine maker for cars but has since extended into areas such as electric vehicles, energy storage and data center construction. Foxconn meanwhile, which assembles Apple's iPhone and is a key partner for Nvidia, manufactures server racks designed for AI workloads. The two companies are now teaming up to bring their expertise together to effectively create a one-stop-shop for anyone looking to set up an AI data center. "The strategic partnership extends the two companies' cooperation in the fields of low-carbon smart factories and energy services, toward being a one-stop solution for data centers going forward," TECO Chairman Morris Li said. The assembly of AI servers has become a key focus as Foxconn looks to diversify its revenue beyond the manufacturing of consumer electronics. AI server revenue is expected to have doubled in the second quarter of the year, Foxconn previously forecast. The company has also shown its willingness to expand into new areas including the assembly of electric vehicles and even manufacturing of semiconductors. "With the AI infrastructure boom, Hon Hai with [a] strategic alliance with TECO aims to extend and tightly integrate the server components and racks value chain from co-design, manufacturing to engineering and infrastructure construction services," Neil Shah, partner at Counterpoint Research, told CNBC. "Hon Hai aims to become a one-stop shop for all the datacenter needs." Tech giants from Microsoft to Google have already laid out plans to spend billions of dollars this year alone on data centers, which includes chips and servers -- a market that Foxconn is targeting. Foxconn and TECO said they are targeting business in Taiwan and other parts of Asia, as well as the Middle East and the U.S. The two companies pointed to their footprint in the U.S. and said they plan to "expand American manufacturing and reshape the global supply chain." "The full data center solutions will give strong impetus to Foxconn's business as it takes to take a bigger slice of the overall data center CAPEX (capital expenditure) which includes servers to physical infrastructure," Counterpoint Research's Shah said.

AppleInsider.com

Apple's main manufacturer Foxconn is betting big on the AI boom, teaming up with TECO to offer an all-in-one solution for building next-gen data centers. The rapid rise of artificial intelligence has kicked off a global race to build the infrastructure needed to support it. Tech giants and manufacturers alike are scrambling to claim a piece of the action. To cash in on that, Foxconn is buying a 10% stake in TECO Electric & Machinery as part of its recent push into AI data center infrastructure, according to CNBC. The deal marks another step in Foxconn's shift beyond consumer electronics. The Taiwanese firm, best known for assembling Apple's iPhone, is aiming to replicate its hardware dominance in the fast-growing world of AI. Its latest moves suggest a long-term bet on the infrastructure powering the next generation of computing. TECO, once a car engine maker, has since expanded into EVs, energy storage, and data center construction. Foxconn, meanwhile, already manufactures server racks designed for AI workloads and is a key Nvidia partner. Together, the companies plan to offer an all-in-one solution for building out AI data centers in Taiwan, the Middle East, and the U.S. Their partnership also covers energy services and low-carbon smart factory projects. Foxconn will take a 10% stake in TECO as part of the deal, and as part of a share exchange. Apple needs to get in on Foxconn's new interest too. It stands to reason that Foxconn will get tapped for a large chunk of Apple's demand. Apple will likely benefit from the deal as well. Apple's future AI ambitions require expanded server infrastructure, globally. Given the companies' longstanding ties, Foxconn is well-positioned to handle any future demand.

Hon Hai Technology Group (Foxconn) and TECO Announce Strategic Alliance Targeting AI Data Center Capabilities

Key markets get boost in new shares exchange TAIPEI, July 30, 2025 /PRNewswire/ -- Hon Hai Technology Group ("Foxconn") (TWSE:2317) and TECO Electric & Machinery Co Ltd Ltd ("TECO") on Wednesday announced a share exchange, strategic alliance that will strengthen their AI infrastructure capabilities and propel the two Taiwanese tech majors into key markets in the global super-computing race. The move brings together the strengths of Foxconn, the world's largest electronics manufacturing service provider and AI server producer, and TECO, a leader in industrial electro-mechanical engineering and green energy innovation. Seizing on the development of global AI data center (AIDC) construction towards standardization and modularization, the two companies will jointly explore AIDC business opportunities. Global customers will be able to tap comprehensive data center modular products, electromechanical engineering services, and cost-competitive, one-stop solutions. According to terms approved by both boards, respectively, TECO will take a 0.519% stake in Hon Hai Precision Industry Co Ltd, the formal name Foxconn trades on at the Taiwan Stock Exchange. In turn, Foxconn will own 10% in TECO. The latter will issue 237,644,068 new shares to Foxconn, and Foxconn will issue 72,481,441 new shares to TECO, implying a share exchange ratio of approx. 1 to 0.305. The no-cash transaction is targeted to complete in fourth quarter of this year, conditional on regulatory approvals. Foxconn Chairman Young Liu said, "Time-to-market is key in the global super-computing race. Modular design is gaining popularity. As AI data centers grow in size and demand ramps higher, teaming up with TECO means both companies are able to level up and rapidly deliver comprehensive, vertically-integrated solutions to our customers - the Tier-1 CSPs and hyperscalers." TECO Chairman Morris Li said, "Changing global dynamics are creating new opportunities for business and cooperation. The strategic partnership extends the two companies' cooperation in the fields of low-carbon smart factories and energy services, toward being a one-stop solution for data centers going forward." Target markets cover Taiwan, Asia, the Middle East and the US. Texas-based TECO-Westinghouse, a world leader in making electric motors, with its US manufacturing and local services, together with Foxconn's US manufacturing base, are in line with the companies' strategic aim to expand US manufacturing and reshape the global supply chain. About TECO here. About Foxconn here. View original content to download multimedia:https://www.prnewswire.com/news-releases/hon-hai-technology-group-foxconn-and-teco-announce-strategic-alliance-targeting-ai-data-center-capabilities-302517136.html SOURCE Hon Hai Technology Group (Foxconn)

Taiwan's Foxconn partners with TECO to build AI data centres

TAIPEI (Reuters) -Taiwan's Foxconn, the world's largest contract electronics maker, will form a strategic partnership with industrial motor maker TECO Electric & Machinery to boost development in the AI data centre market, they said on Wednesday. The move underscores Foxconn's efforts to expand beyond its traditional role as an iPhone assembler as it taps opportunities in the artificial intelligence infrastructure market, from supplying AI server racks to data centre businesses. Under the deal, Foxconn will hold a 10% stake in TECO, which will hold about 0.519% of Foxconn, they said, adding at a press conference that the partnership's target market extends beyond Taiwan and Asia to the U.S. and Middle East. The companies aim to accelerate global data centre development by combining Foxconn's expertise in servers, cooling systems and uninterruptible power supplies with TECO's experience in data centre power infrastructure, they said. TECO Electric & Machinery Co is Taiwan's top industrial motor maker and ranks among the world's top five suppliers of small low-voltage and medium- to high-voltage motors. It also produces motors for electric vehicles. The company has provided mechanical, electrical and plumbing engineering services for data centre infrastructure for more than a decade, it said, specialising in power infrastructure outside the server room. "This is where Foxconn and TECO can jointly extend the value chain. Accelerating data centre construction will also help expand the server rack market," said Foxconn spokesperson James Wu. "Taiwan's strength in AI lies in its vertical integration, design capabilities, and production scale... (the) Foxconn-TECO partnership would result in faster, more cost-efficient solutions." The news comes after Apple and Nvidia supplier Foxconn halted trading in its shares on Wednesday. TECO also halted trading in its shares. TECO entered Malaysia's data centre infrastructure market this year with the acquisition of an 80% stake in NCL Energy. In July, the company said it had secured major data centre projects in the Malaysian states of Selangor and Johor Bahru. Foxconn, officially called Hon Hai Precision Industry, has a big AI server business and is actively expanding its electric vehicle business. It has also been seeking partnerships with automakers and within the automotive supply chain. The Taiwan technology giant this month reported record second-quarter revenue on strong demand for AI products but cautioned about geopolitical and exchange rate headwinds. (Reporting by Lee Wen-Yee; Writing by Brenda Goh; Editing by Anne Marie Roantree, Clarence Fernandez and Jan Harvey) By Wen-Yee Lee and Faith Hung