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H foxconn | (Photo: Reuters)
Apple supplier Foxconn on Wednesday surpassed expectations with a 6 per cent rise in quarterly net profit driven by a boom in demand for AI servers, and stood by its forecast for full-year revenue to grow significantly.
The world’s largest contract electronics maker said it expected robust demand for artificial intelligence servers to continue to boost growth.
“In fact, our business visibility is slightly better than that in May,” Foxconn spokesman James Wu said on an earnings call, without elaborating.
Foxconn said it would start product delivery for AI semiconductor leader Nvidia’s GB200 chip in the fourth quarter in small volumes, which would rise further in early 2025.
Wu emphasized Foxconn’s leading position in the AI server market, saying its capacity and technology would not be easily challenged by competitors.
“That will not be changed in a short time,” he said.
The Taiwanese company said net profit for the April-June quarter rose to $35.05 billion ($1.09 billion) from T$33 billion in the same period the previous year.
That beat analysts’ average estimate of $34.29 billion.
It was the fourth consecutive quarterly profit rise for the company.
Foxconn said AI servers made up more than 40 per cent of its server business in the second quarter, and that its next generation AI computing solution had brought “strong growth momentum.”
The company expected revenue for the third quarter to grow significantly from a year earlier, although revenue from smart computer electronics including smartphones was likely to be flat.
Formally called Hon Hai Precision Industry Co Ltd, Foxconn has expected its operations to pick up gradually in the second half as many electronics vendors, including Apple, usually release new products ahead of the year-end holiday season.
Prior to the earnings announcement, Taipei-based KGI Securities revised up its sales forecast for Foxconn this year, saying strong demand for new iPhones and AI servers could support a better-than-expected outlook in the second half.
Shares of Foxconn closed up 2.5 per cent ahead of the results announcement.
(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)
First Published: Aug 14 2024 | 3:00 PM IST
