Hon Hai Precision Industry Co (鴻海精密), the main supplier of Nvidia Corp artificial intelligence (AI) servers, posted a 3.16 percent year-on-year rise in sales last month and strengthened its first-quarter outlook.
Hon Hai, also known as Foxconn Technology Group (富士康科技集團), the world’s largest assembler of Apple Inc iPhones, reported revenue of NT$538.67 billion (US$16.4 billion) last month. The comparison with last year was skewed by the fact that this year the week-long Lunar New Year holiday fell last month, versus February last year.
On a monthly basis, revenue fell 17.74 percent as the Lunar New Year holiday reduced the number of working days.
Photo: Ritchie B. Tongo, EPA-EFE
As Nvidia’s most important AI server maker, Hon Hai’s performance is a bellwether for the AI infrastructure build-out.
The company said first-quarter sequential growth, or the increase from the December quarter, would be “better than the average level” of the past five years.
That is a rosier projection than the “roughly similar levels” the company teased last month. Growth on a year-over-year basis would be strong, a better outlook as well than that stated before.
Hon Hai, which ships electronics to the rest of the world from giant production bases in China, is grappling this year with uncertainty surrounding US President Donald Trump administration’s tariffs and the sustainability of the AI boom.
While big tech firms from Microsoft Corp to Amazon.com Inc this month pledged to continue spending to keep pace with a revolutionary technology, Chinese start-up DeepSeek’s (深度求索) rise has spurred doubts about whether all that infrastructure expenditure is justified.
“Hon Hai’s future growth is increasingly tied to AI servers — a segment in which it competes with other original design manufacturers such as Quanta Computer Inc (廣達), Inventec Corp (英業達) and Wistron Corp (緯創),” Bloomberg Intelligence analysts Steven Tseng (曾緒良) and Sean Chen said in a note.
“Hon Hai’s sales growth aligns with electronics manufacturing peers, with robust growth in the cloud segment offset by slower consumer electronics. Its profitability and valuation are both below peer average, dragged lower by iPhone assembly operations,” Chen said.
Intel Corp chief executive officer Lip-Bu Tan (陳立武) is expected to meet with Taiwanese suppliers next month in conjunction with the opening of the Computex Taipei trade show, supply chain sources said on Monday. The visit, the first for Tan to Taiwan since assuming his new post last month, would be aimed at enhancing Intel’s ties with suppliers in Taiwan as he attempts to help turn around the struggling US chipmaker, the sources said. Tan is to hold a banquet to celebrate Intel’s 40-year presence in Taiwan before Computex opens on May 20 and invite dozens of Taiwanese suppliers to exchange views
Application-specific integrated circuit designer Faraday Technology Corp (智原) yesterday said that although revenue this quarter would decline 30 percent from last quarter, it retained its full-year forecast of revenue growth of 100 percent. The company attributed the quarterly drop to a slowdown in customers’ production of chips using Faraday’s advanced packaging technology. The company is still confident about its revenue growth this year, given its strong “design-win” — or the projects it won to help customers design their chips, Faraday president Steve Wang (王國雍) told an online earnings conference. “The design-win this year is better than we expected. We believe we will win
Quanta Computer Inc (廣達) chairman Barry Lam (林百里) is expected to share his views about the artificial intelligence (AI) industry’s prospects during his speech at the company’s 37th anniversary ceremony, as AI servers have become a new growth engine for the equipment manufacturing service provider. Lam’s speech is much anticipated, as Quanta has risen as one of the world’s major AI server suppliers. The company reported a 30 percent year-on-year growth in consolidated revenue to NT$1.41 trillion (US$43.35 billion) last year, thanks to fast-growing demand for servers, especially those with AI capabilities. The company told investors in November last year that
United Microelectronics Corp (UMC, 聯電) forecast that its wafer shipments this quarter would grow up to 7 percent sequentially and the factory utilization rate would rise to 75 percent, indicating that customers did not alter their ordering behavior due to the US President Donald Trump’s capricious US tariff policies. However, the uncertainty about US tariffs has weighed on the chipmaker’s business visibility for the second half of this year, UMC chief financial officer Liu Chi-tung (劉啟東) said at an online earnings conference yesterday. “Although the escalating trade tensions and global tariff policies have increased uncertainty in the semiconductor industry, we have not