Hon Hai Precision Industry Co (鴻海), the major assembler of iPhones, posted its slowest profit increase in a year as tepid PC sales put at risk chairman Terry Gou’s (郭台銘) pledge for 10 percent annual revenue growth.
Third-quarter net income climbed 10.8 percent to NT$34.09 billion (US$1.1 billion), according to company data filed with the Taiwan Stock Exchange yesterday.
Profit rose at the slowest pace since a 6.1 percent drop a year earlier and matched the NT$34.1 billion average of 16 analysts’ estimates compiled by Bloomberg.
Operating profit fell 1.49 percent year-on-year to NT$31.37 billion last quarter, although the figure represents a 12.32 percent increase from the previous quarter.
Hon Hai posted revenue growth of 5.8 percent for the 10 months through last month as sales of devices other than Apple’s such as PCs and consumer electronics slow.
“While iPhone is strong, it’s still only around 40 percent of Hon Hai revenue while areas such as PCs, iPads and other tablets remain weak,” Calvin Huang (黃文堯), an analyst at SinoPac Financial Holdings Co (永豐金控) in Taipei , said before the earnings announcement. “The key focus is on margins because Hon Hai is getting better and better at ramping up production of new iPhones.”
Earnings per share were NT$2.30 in the past quarter, with gross margin of 7.1 percent and operating margin of 3.3 percent.
That was improved from earnings per share of NT$1.37 in the second quarter, with gross margin of 7.05 percent and operating margin of 3.18 percent, Hon Hai data showed. Revenue for the third quarter, reported earlier, rose 3.4 percent to NT$950 billion.
Hon Hai shares rose 2.1 percent to close at NT$98 in Taipei before the earnings announcement. The stock has climbed 37 percent this year, while the TAIEX has gained 4.3 percent in the same period.
Additional reporting by staff writer
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