Hon Hai Precision Industry Co (鴻海), the world’s largest contract electronics manufacturer, is committed to increasing its spending on research and development (R&D) of new technologies.
Responding to a Bloomberg report about plans to substantially reduce costs next year amid falling global demand, Hon Hai said it is reviewing its spending for next year, but would not cut back on R&D funding.
“Hon Hai is building on its efforts over the past 40 years to develop core manufacturing technology and is exploring the field of industrial Internet at the moment,” the company said in a statement late on Thursday.
It said its long-term efforts in industrial Internet development, big data, artificial intelligence and production automation have paid off for the group.
Hon Hai, known as Foxconn Technology Group (富士康) overseas, said it would “boost R&D spending in a bid to develop new technology and innovative products.”
The funding is to be allocated based on the group’s worldwide investments and specific needs at certain production sites as part of a global expansion effort, said Hon Hai, which assembles iPhones for Apple Inc.
In the statement, Hon Hai said it is working to transform its operations, which includes its normal annual review of its spending plans and allocation of resources.
The cost review is focused mainly on divisions and subsidiaries that have not been meeting their operational and profit targets, the company said, adding that its R&D operations are not part of that review.
According to the Bloomberg report, Hon Hai is planning to cut costs by 20 billion yuan (US$2.88 billion) next year to almost half of its current annual spending, due to expected stiff competition.
The report said Hon Hai is aiming to reduce spending on its iPhone assembly operations by 6 billion yuan and cut its non-technical workforce by 10 percent.
A European brokerage has cut its target price on Hon Hai shares, citing Apple’s plans to reduce orders to the Taiwanese supplier amid weaker-than-expected demand for its three latest iPhones.
In a research note yesterday, the brokerage said its decision to cut its target price on Hon Hai also reflected expected continued losses by FIH Mobile Ltd (富智康), which is about 70 percent-owned by Hon Hai.
Amid such unfavorable circumstances, the brokerage said it has lowered its target price on Hon Hai shares from NT$80 to NT$76, but kept its “neutral” recommendation on the stock.
Hon Hai shares yesterday rose 0.72 percent to close at NT$70 in Taipei trading.
Softbank Group Corp plans to keep a stake in the chip designer Arm Ltd, even if it sells a partial interest to Nvidia Corp, the Nikkei reported. The companies are negotiating terms, the newspaper reported, citing sources. Softbank might take a stake in Nvidia after it buys Arm, the report said. Nvidia and Arm might also merge through a share swap, and Softbank would become a major shareholder in the combined company, it said. The two parties aim to reach a deal in the next few weeks, the sources said, asking not to be identified because the information is private. Nvidia is the
‘ONE-STOCK SHOW’: Turnover hit an all-time high as TSMC continued to determine the local market’s direction and surpassed Visa in market capitalization The TAIEX early yesterday hit an all-time intraday high on the back of soaring Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) shares, before tumbling back to the previous day’s close as the contract chipmaker could not single-handedly prop up the index. The TAIEX rose more than 400 points in the first 20 minutes of trading to hit a record 13,031.7 points, but later pared its gains to close down 0.01 percent at 12,586.73. Turnover was NT$343.252 billion (US$11.63 billion), the highest in the Taiwan Stock Exchange’s history. TSMC continued to dictate the market’s direction, as its early surge by the daily
Gold surged to a fresh record on Friday, fueled by US dollar weakness and low interest rates, while silver headed for its best month since 1979. Spot bullion is up more than 10 percent this month, as US real yields lingered near record lows. While the ferocity of rallies in gold and silver cooled in the middle of the week, most market watchers predict there might be more gains ahead. Both metals have added about 30 percent this year, with gold and silver exchange-traded funds boosting holdings to a record, as concern about the fallout from the COVID-19 pandemic fuels demand for
MOVING FROM CHINA? The article did not name the company, but Foxconn, Wistron and Pegatron were among firms chosen for a production-linked incentive plan in India An Apple Inc vendor is looking at shifting six production lines to India from China, which could result in US$5 billion of iPhone exports from the South Asian nation, the Times of India reported, citing people familiar with the matter who it did not identify. The establishment of the facility would create about 55,000 jobs over about a year, the newspaper reported, not naming the Apple vendor. It would also cater to the domestic market and expand operations to include tablets and laptops, the newspaper reported. Samsung Electronics Co and Apple’s assembly partners are among 22 companies that have pledged 110 billion