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Hon Hai Precision Industry Posts Strong June-Quarter Sales
Hon Hai Precision Industry Co., also known as Foxconn, has reported sales figures for the June quarter that exceeded analysts' expectations, driven by its growing AI server business. The company announced on Friday that its revenue in June was NT$490.7 billion ($15.1 billion), culminating in a total of NT$1.55 trillion for the quarter, marking a 19% increase. Analysts had anticipated a 13.8% rise, buoyed by Hon Hai's previous indication that its AI business would help surpass these predictions.
Hon Hai's shares, traded in Taipei, have more than doubled in value this year, reaching new peaks in June amidst optimism that the company could leverage the AI surge. This marks a significant turnaround after a challenging 2023, where sales dipped owing to a slump in demand for consumer electronics, which the company also assembles. However, revenue is now swiftly climbing due to orders for AI servers and data center equipment, allowing Hon Hai to diversify from its conventional smartphone manufacturing business.
Positive Projections for Upcoming Quarters
In its Friday statement, accompanying the monthly sales release, Hon Hai projected that the third quarter would show growth compared to both the previous quarter and the same period last year. Investor enthusiasm regarding Hon Hai's involvement in the AI hardware market had driven its share price above NT$200—a milestone that founder Terry Gou had aimed to reach back in 2016.
Global Attention on Taiwan
The AI boom has brought considerable attention to Taiwan, significantly enhancing the prestige of events such as Computex. The latest Computex event was notably successful, attracting CEOs from leading US chipmakers who sought to engage important suppliers and manufacturers of data center equipment.
AI's expanding role in tech has become a key focal point for Hon Hai, allowing it to mitigate the impact of reduced demand in the consumer electronics sector. As the demand for AI infrastructure grows, so does Hon Hai's potential for increased revenue and market stability in this burgeoning field.
