Slow season effects are expected to continue affecting Hon Hai Precision Industry Co’s (鴻海精密) shipments in the second quarter of this year, analysts said yesterday.
Hon Hai, the world’s largest contract electronics maker, could see its revenue for the April-to-June period fall below the NT$957.9 billion (US$29.73 billion) it recorded in the first quarter by a single-digit percentage, they said.
The analysts’ remarks came after Hon Hai on Wednesday reported weaker sales for last month, as the lingering slow season effects put a dent in the firm’s shipments of consumer electronics devices, although shipments of computing and communications devices remained little changed.
Consolidated sales declined 8.37 percent to NT$295.41 billion from the previous month and fell 2.05 percent from the previous year, the assembler of iPhones and iPads for Apple Inc said in a statement.
In the first five months of this year, Hon Hai’s consolidated sales dropped 5.56 percent from a year earlier to NT$1.58 trillion, company data showed.
Analysts said that as demand for consumer electronics is expected to continue to weaken this month, and the sales cycle of the iPhone 6S and iPhone 6S Plus models comes to an end, Hon Hai could have a worse second quarter than the first quarter in terms of revenue.
In addition, FIH Mobile Ltd (富智康), a handset manufacturing arm of Hon Hai, also saw its sales momentum in contract consumer electronics manufacturing slowing last month, putting the parent company at a disadvantage.
However, Hon Hai’s sales momentum could start to pick up in the third quarter, as Apple, which accounts for about 40 percent of the firm’s total sales, is expected to unveil its next-generation iPhones in September, analysts said.
Hon Hai is scheduled to hold an annual general meeting on June 22, at which its shareholders are expected to decide whether to approve the company’s proposal to issue a dividend of NT$5 per share, which would include a NT$4 cash dividend and a NT$1 stock dividend, for last year.
If the dividend proposal is approved, Hon Hai is expected to pay out more than NT$62.55 billion, the highest cash dividend payout in the company’s history.
On Wednesday, Hon Hai shares rose 0.25 percent to close at NT$81.3 on the Taiwan Stock Exchange.
The local equity market was closed yesterday and is to remain closed today for the Dragon Boat Festival holiday.
Ryanair, Transavia, Volotea and other low-cost airlines are feeling the financial pain from high jet fuel prices as a result of the Middle East war and are cutting flights. The closure of the Strait of Hormuz has taken a huge chunk of oil supplies off the market, sending the price of jet fuel soaring and triggering fears of shortages that could force airlines to cancel flights. Airlines are not waiting for a lack of supplies to react. “Travel alert: Airlines are cutting thousands of flights right now,” Travel Therapy host Karen Schaler said in an Instagram reel this past weekend.
MANAGING RISKS: Taiwan has secured LNG sufficient to cover 95 percent of electricity demand for next month, UBS said, describing the government’s approach as proactive UBS Group AG has raised its forecast for Taiwan’s economic growth this year to 8 percent, up from 6.9 percent previously, and said expansion could reach as high as 8.6 percent if external energy shocks are avoided. The upgrade reflects a stronger-than-expected first-quarter performance and sustained momentum in artificial intelligence (AI)-driven exports, which UBS said are providing a firm foundation for growth despite geopolitical and energy risks. Taiwan’s GDP expanded 13.69 percent year-on-year in the first quarter, the fastest growth since the second quarter of 1987, the Directorate-General of Budget, Accounting and Statistics (DGBAS) reported on Thursday. On a seasonally
The Fair Trade Commission’s (FTC) ongoing review of Grab Holdings Ltd’s US$600 million acquisition of Foodpanda Taiwan’s operations, announced on March 23, has taken on fresh urgency as industry experts warn that the transaction could embed significant Chinese cybersecurity vulnerabilities into Taiwan’s digital infrastructure through Grab’s deep ties to autonomous-driving firm WeRide (文遠知行). Less than 16 months after the FTC blocked Uber Eats’ direct attempt to acquire Foodpanda Taiwan — citing potential combined market shares of 80 to 90 percent — the emergence of Grab as the buyer has prompted questions about whether the same competitive harm is simply being rerouted
The list of Asian stocks that benefit from business partnership with Nvidia Corp is getting longer, as the region further integrates into the artificial intelligence (AI) chip giant’s business ecosystem. Just in the past week, South Korea’s LG Electronics Inc, Taiwan’s Nanya Technology Corp (南亞科技), as well as China’s Huizhou Desay SV Automotive Co (德賽西威) and Pateo Connect Technology Shanghai Corp (博泰車聯) have become the latest to rally on news of tie-ups, supply-chain participation or product collaboration with the US chip designer. Asian suppliers account for about 90 percent of Nvidia’s production costs, up from about 65 percent last year, data compiled
RSS