Foxconn's AI Server Business Booms Amid Shifting Tech Landscape

Foxconn to post higher Q4 profit on AI server demand

TAIPEI, March 14 (Reuters) - Taiwan's Foxconn (2317.TW), opens new tab, the world's largest contract electronics maker, is expected to report on Friday that fourth-quarter profit rose 2.35% on strong demand for artificial intelligence servers. Net profit for October-December for Apple's (AAPL.O), opens new tab top iPhone assembler and Nvidia's (NVDA.O), opens new tab AI server maker likely came in at T$54.4 billion ($1.65 billion), according to an LSEG consensus estimate of 15 analysts, versus T$53.15 billion a year earlier. Foxconn said in January its fourth-quarter revenue jumped 15.2% to a record for that quarter on strong sales of AI servers. The company, formally called Hon Hai Precision Industry, has said it expects first-quarter performance to be better than the average level of the past five years, and it will see strong year-over-year growth. It does not provide numerical guidance. But an escalating global trade war has dimmed the prospects for its outlook this year, as it has a major manufacturing presence in China and Mexico, two of the top U.S. trading partners that now face increased import tariffs from U.S. President Donald Trump. Apple said last month it will work with Foxconn to build a 250,000-square-foot (23,200-square-metre) facility in Houston, where it will assemble servers that go into data centres to power Apple Intelligence. Foxconn holds its earnings call at 3 p.m. in Taipei (0700GMT) on Friday, where it will also update its outlook for the rest of the year. Foxconn's shares have fallen 8.7% so far this year, hit by concerns about U.S. tariffs and trade policy. ($1 = 32.9550 Taiwan dollars) Reporting by Wen-Yee Lee, Yimou Lee and Faith Hung; Editing by Christian Schmollinger Our Standards: The Thomson Reuters Trust Principles., opens new tab Suggested Topics:Artificial Intelligence

Foxconn sees server revenue surpassing iPhone revenue in two years, agency report says

TAIPEI, March 19 (Reuters) - Taiwan's Foxconn (2317.TW), opens new tab, the world's largest contract electronics maker and Apple's (AAPL.O), opens new tab main iPhone maker, expects its server revenue to surpass its revenue from iPhones within two years, Taiwan's Central News Agency reported. Foxconn Chairman Young Liu, asked by the news agency on the sidelines of Nvidia (NVDA.O), opens new tab's annual developer conference GTC on Tuesday on whether its server revenue would surpass its iPhone revenue, said it would "definitely happen within two years", according to the report. It also quoted him as saying that it could even be achieved as early as this year. Foxconn manufactures Nvidia's latest artificial intelligence servers, including Nvidia's GB200 and GB300 products. The company confirmed Liu's comments to Reuters on Wednesday "We do most of the Nvidia systems, not 100% of them, but most of them," Liu said in a live podcast with The Acquired at GTC. Liu said in the company's earnings call last week that its AI server revenue is set to reach T$1 trillion ($30.29 billion)this year to account for more than half of the company's total server revenue. He added that its revenue from cloud and networking products, driven by strong demand for AI servers, will approach that of smart consumer electronics, including iPhones, this year. In 2024, 30% of the company's revenue came from cloud and networking products, while 46% came from smart consumer electronics. ($1 = 33.0150 Taiwan dollars) Reporting by Wen-Yee Lee; Editing by Kim Coghill Our Standards: The Thomson Reuters Trust Principles., opens new tab Suggested Topics:Technology

Taiwan tech giant Foxconn's 2024 profit misses forecasts

Taipei (AFP) - Taiwanese tech giant Foxconn reported on Friday a lower-than-expected net profit for 2024 as consumer electronic gadgets underperformed, although demand for its artificial intelligence servers remained robust. The world's largest contract electronics manufacturer has been moving beyond assembling devices such as Apple's iPhones into areas ranging from electric vehicles to AI servers. The company said full-year net profit rose seven percent to NT$152.7 billion (US$4.6 billion). That compares with an average forecast of NT$159.4 billion, according to a Bloomberg News survey of analysts. Full-year revenue rose 11 percent to NT$6.9 trillion, beating the market forecast of NT$6.8 trillion. Foxconn, also known as Hon Hai Precision Industry, has been riding a wave of global demand for generative AI in recent years. The company reported a "strong performance" in its AI server business, with revenue up 150 percent, according to documents released ahead of an earnings call with analysts. This year would be the "Year of AI", the company said, with shipments increasing in every quarter. The earnings announcement comes as US President Donald Trump imposed tariffs against major trading partners including China, Canada and Mexico, igniting trade wars and causing markets to fall. While Foxconn has plants around the world, the bulk of its operations is based in China, which has been hit by 20 percent levies on products shipped to the United States. Foxconn is building a mega-AI server plant in Mexico, which a local official told Bloomberg recently would be completed in a year despite Trump's tariff threats. The $900 million assembly plant near Guadalajara will become the world's largest to be powered by Nvidia's GB200 AI chips, Jalisco Governor Pablo Lemus Navarro said. Apple said recently it would team up with Foxconn later this year to begin producing servers that power the cloud components of Apple Intelligence in Houston, Bloomberg reported. "I think there will be more and more of these projects, and when these projects mature, we will let everyone know," Foxconn chairman Young Liu said in response to a question about the company's plans for further US investment on an online earnings call. 'Very confident in Apple' Liu noted that tariffs were "quite a headache" for the chief executives of Foxconn's customers, but he said it was "very, very difficult to predict" how it would unfold. "We can only wait and see what will happen and do what we can do well. This is Hon Hai's attitude," Liu said. Foxconn makes most of its revenue from iPhones, whose sales have slipped in markets like mainland China, but Liu brushed aside concerns about the popular gadget. "We are very, very confident in Apple," Liu said. "I believe that they will definitely do something in the generative AI area, so we will continue to maintain in-depth cooperation with our client. This will not change." Foxconn has also been in the spotlight over potential cooperation with Japanese automaker Nissan after its merger talks with rival Honda fell through in February. Liu previously said Foxconn was open to buying French auto giant Renault's stake in Nissan and was looking into a cooperation with Nissan, not a merger. The company has also been looking to expand into the Japanese EV market. Liu said Friday that Foxconn is expected to sign a contract with a Japanese car maker or makers "within one or two months".

Foxconn to post higher Q4 profit on AI server demand

Net profit for October-December for Apple's top iPhone assembler and Nvidia's AI server maker likely came in at T$54.4 billion ($1.65 billion), according to an LSEG consensus estimate of 15 analysts, versus T$53.15 billion a year earlier.Taiwan's Foxconn, the world's largest contract electronics maker, is expected to report on Friday that fourth-quarter profit rose 2.35% on strong demand for artificial intelligence servers. Net profit for October-December for Apple's top iPhone assembler and Nvidia's AI server maker likely came in at T$54.4 billion ($1.65 billion), according to an LSEG consensus estimate of 15 analysts, versus T$53.15 billion a year earlier. Foxconn said in January its fourth-quarter revenue jumped 15.2% to a record for that quarter on strong sales of AI servers. The company, formally called Hon Hai Precision Industry, has said it expects first-quarter performance to be better than the average level of the past five years, and it will see strong year-over-year growth. It does not provide numerical guidance. But an escalating global trade war has dimmed the prospects for its outlook this year, as it has a major manufacturing presence in China and Mexico, two of the top U.S. trading partners that now face increased import tariffs from U.S. President Donald Trump. Apple said last month it will work with Foxconn to build a 250,000-square-foot (23,200-square-metre) facility in Houston, where it will assemble servers that go into data centres to power Apple Intelligence. Foxconn holds its earnings call at 3 p.m. in Taipei (0700GMT) on Friday, where it will also update its outlook for the rest of the year. Foxconn's shares have fallen 8.7% so far this year, hit by concerns about U.S. tariffs and trade policy.

Foxconn's Fourth-Quarter Profit Misses Expectations Despite Revenue Gain

Foxconn Technology Group reported weaker-than-expected quarterly results as the world's largest contract electronics maker continued diversifying its business, moving into growth areas such as artificial intelligence and electric vehicles. The Taiwanese company, formally known as Hon Hai Precision Industry, said Friday that net profit dropped 13% to 46.33 billion New Taiwan dollars, equivalent to US$1.40 billion. That missed the NT$53.94 billion estimate by analysts polled by FactSet. Revenue rose 15% from a year earlier to NT$2.1305 trillion. The results come as Foxconn has expanded its footprint into high-growth tech sectors like AI and EVs in recent years as its core electronics manufacturing business faces challenges due to industry shifts. Foxconn, best known for assembling Apple's iPhones, now plays an increasingly important role in building AI servers for U.S. tech giants such as Amazon and Nvidia. Cloud and networking products, which include AI servers, made up 26% of its fourth-quarter revenue and formed its second-biggest revenue stream, behind smart consumer-electronics products. Its gross margin dropped 4 basis points from the last quarter to 6.15% amid a significant ramp-up of the AI server business, which has lower margins at this stage. Morningstar analyst Dan Baker said the profitability measure could recover to 7.1% in 2028 as the company scales up its server and EV businesses. Foxconn reported a nonoperating loss of NT$1.17 billion, swinging from profit of NT$17.97 billion a year earlier. Foxconn expects its AI server revenue to surpass NT$1 trillion in 2025, making up 50% of its total server revenue and grabbing over 40% market share.

Electronics giant Foxconn forecasts strong Q1 revenue after Q4 profit miss

TAIPEI (Reuters) -Taiwan's Foxconn,the world's largest contract electronics maker, said on Friday that solid demand from its tech clients would drive strong revenue growth in the first quarter. The upbeat forecast contrasts with a cautious note struck by many other businesses, rattled by U.S. President Donald Trump's tumultuous trade policy, and underscores that booming demand for artificial intelligence is not over yet and would further drive hardware sales. "We have not seen CSP (cloud service providers) demand slowing down. There are (market) rumours that CSP demand will peak this year, and then it will go down next year. But we are not seeing that ... at least for Foxconn," Chairman Young Liu told analysts on a conference call. He said AI servers would account for more than half of the company's total server revenue this year, as it expands production for Nvidia. Foxconn, whose businesses also include manufacturing iPhones for Apple, booked an October-December net profit of T$46.33 billion ($1.41 billion), missing the T$54.4 billion average of 15 analyst estimates compiled by LSEG. The profit decline was Foxconn's first since the second quarter of 2023, when it fell 0.9%, and largely stemmed from a loss in its non-operating business segments. Foxconn did not provide a breakdown of its non-operating income and expense account. In January, Foxconn said October-December revenue jumped 15.2% to a record for that quarter on strong AI server sales. The company, formally Hon Hai Precision Industry, on Friday said first-quarter revenue from consumer electronics is likely to grow significantly and that sales from cloud and networking products would grow strongly, without giving numerical guidance. An escalating global trade war has complicated prospects as Foxconn has a major manufacturing presence in China and Mexico, two of the biggest U.S. trading partners facing increased import tariffs under Trump's administration. Most of the iPhones it makes for Apple are assembled in China. Foxconn is also building a large manufacturing facility in Mexico to produce AI servers for Nvidia. Apple said last month it will work with Foxconn to build a 250,000 square foot (23,200 square metre) facility in Houston to assemble servers for data centres that power Apple Intelligence. Liu said it will plan production cooperation with its customers in several U.S. states. "It is difficult to predict the U.S. government's attitude and approach towards tariffs. We can only wait and see and do our best with what we can control," he said. ($1 = 32.9550 Taiwan dollars) (Reporting by Wen-Yee Lee, Yimou Lee and Faith Hung; Writing by Miyoung Kim; Editing by Kim Coghill and Christopher Cushing)

Foxconn's Forecast: From Profit Miss to Revenue Bliss

Despite a recent stumble in quarterly profits, the Taiwanese giant is confidently predicting a robust revenue surge for the first quarter, thanks to strong demand from its tech clientele. While many companies are feeling the tremors of President Donald Trump's unpredictable trade policies, Foxconn is riding high on the wave of artificial intelligence demand. Chairman Young Liu, in a recent call with analysts, dismissed market rumors of a slowdown in cloud service provider demand. "At least for Foxconn," he assured, "the demand is alive and kicking." AI servers are set to be the star of the show, projected to make up more than half of Foxconn's server revenue this year, with production ramping up for tech titan Nvidia. However, Foxconn's October-December net profit of T$46.33bn ($1.41bn) fell short of expectations, missing the T$54.4bn forecast by analysts. This marked the first profit dip since mid-2023, attributed mainly to losses in non-operating business segments, though details remain under wraps. Despite this, Foxconn reported a 15.2% revenue jump for the same quarter, driven by strong AI server sales. Looking ahead, the company anticipates significant growth in consumer electronics and robust sales in cloud and networking products, though it remains tight-lipped on specific figures. New horizons The global trade landscape is fraught with challenges, particularly for Foxconn, which has substantial manufacturing operations in China and Mexico -- both facing increased tariffs under Trump's administration. Most of Apple's iPhones, for instance, are assembled in China. In response, Foxconn is expanding its footprint in Mexico with a new facility dedicated to producing AI servers for Nvidia.

World's largest contract electronics maker Foxconn sees server revenue surpassing iPhone revenue in 2 years

Taiwan's Foxconn, the world's largest contract electronics maker and Apple's main iPhone maker, expects its server revenue to surpass its revenue from iPhones within two years, Taiwan's Central News Agency reported. Foxconn Chairman Young Liu, asked by the news agency on the sidelines of Nvidia's annual developer conference GTC on Tuesday on whether its server revenue would surpass its iPhone revenue, said it would "definitely happen within two years", according to the report. Foxconn manufactures Nvidia's latest artificial intelligence servers, including Nvidia's GB200 and GB300 products. The company confirmed Liu's comments to Reuters on Wednesday "We do most of the Nvidia systems, not 100% of them, but most of them," Liu said. Liu said in the company's earnings call last week that its AI server revenue is set to reach T$1 trillion ($30.29 billion) this year to account for more than half of the company's total server revenue. He added that its revenue from cloud and networking products, driven by strong demand for AI servers, will approach that of smart consumer electronics, including iPhones, this year. In 2024, 30% of the company's revenue came from cloud and networking products, while 46% came from smart consumer electronics.