Apple Inc’s major manufacturing partner Hon Hai Precision Industry Co (鴻海精密) reported its slowest monthly sales growth since February, stoking concerns about demand momentum for artificial intelligence (AI) infrastructure and iPhones.
Hon Hai, also a key server assembly partner to Nvidia Corp, yesterday reported sales of NT$804.85 billion (US$25.18 billion) for last month, up 8.59 percent year-on-year and marking the highest October level in the company’s history.
Analysts expect the company to grow its sales by 15 percent to NT$2.13 trillion this quarter.
Photo: Cheng I-hwa, Bloomberg
Hon Hai’s revenue in the first 10 months of this year was NT$5.53 trillion, up 9.57 percent year-on-year and the highest for the period on record, company data showed.
The iPhone assembler’s tepid sales growth appeared to reinforce Apple’s weak forecast for the holiday quarter.
“Looking ahead to the fourth quarter, operations are anticipated to show both quarterly and yearly growth,” Hon Hai said in a statement, without giving details.
Hon Hai and other hardware suppliers are riding a wave of spending on servers and data centers from big tech firms including Meta Platforms Inc and Alphabet Inc’s Google.
However, questions are bubbling up about how long the spending will last without a killer AI application to justify the large infrastructure investments.
Still, the capital expenditures of the four largest Internet and software companies — Alphabet, Amazon.com Inc, Meta and Microsoft Corp — are set to climb to well over US$200 billion this year, a record sum for the group.
Executives from each company told investors recently that they would continue to spend large sums next year.
Separately, Hon Hai subsidiary ShunSin Technology Holdings Ltd (訊芯科技) is seeking a permit to invest US$80 million in northern Vietnam to produce integrated circuits, Reuters reported on Monday, citing a document from the Vietnamese Ministry of Natural Resources and Environment.
The proposed plant in Bac Giang Province would focus on producing and processing electronic components, specifically IC boards, the document said.
ShunSin plans to begin operations at full-scale in December 2026, with annual capacity of 4.5 million units, it said.
All products from the Vietnam ShunSin plant would be for export to the US, the EU and Japan, the document added.
Hon Hai already has major operations in Vietnam and has invested more than US$3.2 billion there since fist entering the Southeast Asian country in the 2000s. Most of its manufacturing plants are in the northern provinces of Bac Ninh and Bac Giang.
Additional reporting by Reuters
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