Hon Hai Precision Industry Co’s (鴻海精密) second-quarter sales outperformed analysts’ rising expectations on the strength of the company’s growing artificial-intelligence (AI) server business.
The iPhone assembler, also known as Foxconn (富士康), yesterday said that its revenue last month was NT$490.7 billion (US$15.1 billion), making for a total of NT$1.55 trillion for the quarter, up 19 percent. An average of analyst estimates pointed to a 13.8 percent rise, with expectations growing after Hon Hai said a month earlier that it expected the AI business to help it beat estimates for the quarter.
Hon Hai said revenue last quarter marked the strongest second quarter performance in the company’s history and greatly exceeded its own expectations.
Photo: Ann Wang, Reuters
Hon Hai’s shares have more than doubled this year and hit new highs last month on hopes the company can capitalize on the AI boom. It went through a tough year last year, as sales shrank due to moribund demand for the consumer electronics it assembles. However, the company rapidly added revenue from orders for AI servers and other data center gear, diversifying away from the smartphone business.
“The third quarter is expected to generate growth compared to the second quarter and the same period last year,” Hon Hai said in a statement accompanying its monthly sales release.
Excitement about Hon Hai’s role in the AI hardware market helped its shares breach the NT$200 level that founder Terry Gou (郭台銘) had pledged to achieve in 2016. The AI boom has also brought much focus to Taiwan this year, making the latest Computex event a huge success, with CEOs from the biggest US chipmakers all coming to woo key suppliers and data center equipment makers.
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