Foxconn International Holdings Ltd (富士康控股), the world’s largest contract maker of mobile phones, said it expects profitability to come under pressure this year because of rising competition and increased development costs.
“It’s a tough operating environment,” Foxconn chairman Samuel Chin (陳偉良) said after a shareholders’ meeting in Hong Kong yesterday. “We’re not immune — it definitely impacts us.”
Foxconn, the worst-performing stock in Hong Kong’s benchmark Hang Seng Index this year, is seeking more business from customers including Nokia Oyj and Samsung Electronics Co, the world’s two biggest handset companies, to compensate for lower sales to Motorola Inc.
The Shenzhen, China-based company is boosting spending to develop so-called smartphones, which allow users to edit documents and send e-mails.
Motorola, Foxconn’s biggest customer in 2006, is still “having difficulties” and will “continue to impact” the Hong Kong-listed company, Chin said.
Foxconn got higher orders from “all other customers” to help offset lower sales to the US company last year, Chin said.
Foxconn’s second-half profit last year declined 4.5 percent to US$397.4 million as Schaumburg, Illinois-based Motorola’s full-year handset sales fell 33 percent last year.
The US company accounted for 53 percent of Foxconn’s sales in 2006, Morgan Stanley analyst Jasmine Lu (呂智穎) wrote in a report in March.
Foxconn should have significant revenue growth this year as handset companies outsource more production, Chin said.
The company’s shares fell 1.9 percent to HK$9.70 (US$1.24) at the close of trading in Hong Kong yesterday, extending their decline to 45 percent this year. The Hang Seng Index dropped 2.3 percent.
The contract manufacturer plans to increase its spending on engineering 50 percent this year as it offers more smartphones, Chin said.
Foxconn has hired about 800 engineers this year for its smartphones division, he said, adding to the company’s total of 5,514 at the end of last year.
Foxconn’s research and development spending rose 62 percent to US$100.9 million last year after the company added engineers, it said in April.
Foxconn, a unit of Taiwan’s Hon Hai Precision Industry Co (鴻海精密), plans to start production in Debrecen, Hungary, in August, its second site in the country, Chin said.
The Hong Kong-listed company, which at present manufactures mostly in Shenzhen, will also start volume production at Langfang and Taiyuan in northern China this year, he said.
Sweeping policy changes under US Secretary of Health and Human Services Robert F. Kennedy Jr are having a chilling effect on vaccine makers as anti-vaccine rhetoric has turned into concrete changes in inoculation schedules and recommendations, investors and executives said. The administration of US President Donald Trump has in the past year upended vaccine recommendations, with the country last month ending its longstanding guidance that all children receive inoculations against flu, hepatitis A and other diseases. The unprecedented changes have led to diminished vaccine usage, hurt the investment case for some biotechs, and created a drag that would likely dent revenues and
Global semiconductor stocks advanced yesterday, as comments by Nvidia Corp chief executive officer Jensen Huang (黃仁勳) at Davos, Switzerland, helped reinforce investor enthusiasm for artificial intelligence (AI). Samsung Electronics Co gained as much as 5 percent to an all-time high, helping drive South Korea’s benchmark KOSPI above 5,000 for the first time. That came after the Philadelphia Semiconductor Index rose more than 3 percent to a fresh record on Wednesday, with a boost from Nvidia. The gains came amid broad risk-on trade after US President Donald Trump withdrew his threat of tariffs on some European nations over backing for Greenland. Huang further
HSBC Bank Taiwan Ltd (匯豐台灣商銀) and the Taiwan High Prosecutors Office recently signed a memorandum of understanding (MOU) to enhance cooperation on the suspicious transaction analysis mechanism. This landmark agreement makes HSBC the first foreign bank in Taiwan to establish such a partnership with the High Prosecutors Office, underscoring its commitment to active anti-fraud initiatives, financial inclusion, and the “Treating Customers Fairly” principle. Through this deep public-private collaboration, both parties aim to co-create a secure financial ecosystem via early warning detection and precise fraud prevention technologies. At the signing ceremony, HSBC Taiwan CEO and head of banking Adam Chen (陳志堅)
CULPRITS: Factors that affected the slip included falling global crude oil prices, wait-and-see consumer attitudes due to US tariffs and a different Lunar New Year holiday schedule Taiwan’s retail sales ended a nine-year growth streak last year, slipping 0.2 percent from a year earlier as uncertainty over US tariff policies affected demand for durable goods, data released on Friday by the Ministry of Economic Affairs showed. Last year’s retail sales totaled NT$4.84 trillion (US$153.27 billion), down about NT$9.5 billion, or 0.2 percent, from 2024. Despite the decline, the figure was still the second-highest annual sales total on record. Ministry statistics department deputy head Chen Yu-fang (陳玉芳) said sales of cars, motorcycles and related products, which accounted for 17.4 percent of total retail rales last year, fell NT$68.1 billion, or
RSS