Bloomberg
Nvidia Corp’s server assembly partner Hon Hai Precision Industry Co (鴻海精密) reported a stronger-than-expected increase in quarterly sales, a sign of sustained artificial intelligence (AI) demand.Revenue grew 52.11 percent year-on-year to NT$821.8 billion (US$25.74 billion) last month, the company said in a statement yesterday. Last month’s revenue reached the highest June level in the company’s history, but the figure remained 4.38 percent lower than previous month’s NT$859.41 billion, it said.
Visitors walk past Foxconn’s exhibition booth at Computex in Taipei on June 2.
Hon Hai’s sales for the June quarter rose 39.83 percent year-on-year to NT$2.51 trillion, the highest ever for the same period and 18.02 percent higher than the previous quarter’s NT$2.13 trillion. Analysts on average had expected NT$2.37 trillion.The company said the cloud and networking products — primarily servers — electronic components, computing products and smart consumer electronics showed strong annual growth in sales during the second quarter.
For this quarter, the company expects revenue to show quarterly and annual increases on the back of robust AI rack shipments and strong seasonal demand for information and communications technology products, its statement said.Hon Hai, also known as Foxconn Technology Group (富士康), has established itself as a key AI hardware player by assembling servers that house Nvidia accelerators. Alphabet Inc, Amazon.com Inc, Meta Platforms Inc and Microsoft Corp are setting aside about US$725 billion for AI spending this year, even as warnings abound about overcapacity and questions about how to monetize the technology persist.Concerns about a rush to build power-guzzling data centers have also grown since the start of conflict in the Middle East, which has piled pressure on global shipping routes and gas prices.Hon Hai in March projected strong sales growth this year, fueled by sustained AI momentum. It derives a significant chunk of sales from assembling Apple Inc’s iPhones and MacBooks and is in a position to benefit from any positive reception for the latest iPhone 17 product family.However, like many electronics manufacturers, Hon Hai faces a shortage of memory chips used in a wide range of products from smartphones to PCs and servers. Executives have said the crunch should not significantly impact demand for premium handset and computer products the company makes for major customers.In the first half of this year, the company’s revenue increased 34.99 percent year-on-year to NT$4.64 trillion, also the highest for the same period, Hon Hai said.Additional reporting by staff writer
