Hon Hai Precision Industry Co (鴻海精密) yesterday said artificial intelligence (AI) server revenue this quarter is to more than double from a year ago, driven by demand for AI servers based on Nvidia’s GB200 chip from the world’s major cloud service providers (CSP) and large-scale enterprises.
The growth momentum is expected to extend into the rest of the year, Hon Hai said. This year as a whole, revenue from AI servers would swell to about NT$1 trillion, following an annual growth of 150 percent last year, company chairman Young Liu (劉揚偉) told investors during an online investor conference.
That meant AI server revenue would account for more than 50 percent of the company’s overall server revenue this year, up from 40 percent to 42 percent last year, Liu said.
Photo: Chiang Ying-ying, AP
Servers and networking products would soon become the largest revenue contributor to Hon Hai, replacing smartphones, he said.
“The AI server market is thriving now, thanks to strong demand for GB server racks from the world’s major CSPs and first-tier brand vendors. Those [machines] are adopted particularly for cloud computing and high-performance data centers,” Liu said, citing better order visibility.
Hon Hai is also ramping up production of GB200 servers with an improving yield, Liu said, adding that the growth momentum would be supported by the upcoming production of AI servers equipped with new-generation AI chips, he said.
As a key supplier to Nvidia, Hon Hai aims to seize more than 40 percent of the world’s AI server market, Liu said.
Liu also dismissed rumors about ebbing demand for AI servers from cloud service providers (CSPs).
“There was a rumor saying that CSP demand will peak this year. And then, it will go down after this year. We are not seeing that. We think the demand is still pretty strong,” at least for Hon Hai, Liu said.
Asked about growing competition from servers powered by AI application-specific ICs (ASICs), Liu said: “Most of the training still happens in the cloud side, so most activities on the AI demand is mostly still for AI training.”
Looking at the current quarter, Hon Hai expects revenue to grow significantly on an annual basis, beating the seasonal slowdown the company has seen over the past 5 years, Liu said.
All major product segments are expected to see strong year-on-year growth this quarter, led by servers and networking products, Liu said.
Asked about how to cope with US President Donald Trump’s tariff policy, Liu said Hon Hai is discussing with its customers to build new manufacturing sites in the US.
To fund those new factories, Hon Hai plans to hike its capital expenditures this year by 20 percent from NT$136.3 billion last year. The company said it would discuss with customers to absorb cost increases in order to keep a stable profit margin.
Hon Hai yesterday posted the strongest annual net profit in the company’s history, amounting to NT$152.71 billion, up 7 percent from NT$142.1 billion in 2023. Earnings per share rose to NT$11.01 from NT$10.25, the highest since 2008.
The board of directors yesterday approved a cash dividend distribution of NT$5.8 per common share, the best since the company’s listing in 1991. That represented a payout ratio of 52.7 percent.
Taiwanese firms have increased investment in the Philippines in recent years as Manila’s ties with Washington deepen and global supply chains continue to shift away from China, an expert at the Chung-Hua Institution for Economic Research (CIER, 中華經濟研究院) said yesterday. The Philippines had not been among Taiwanese investors’ top choices in Southeast Asia, CIER Taiwan ASEAN Studies Center director Kristy Hsu (徐遵慈) said at a seminar in Taipei. However, Taiwan’s investment in the country has grown significantly since the COVID-19 pandemic, reaching US $257 million last year, a high in recent years, she said. Although Taiwan’s total investment in the Philippines still lags
Intel Corp regards Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) as a longstanding partner, as the US chipmaker would continue outsourcing production of advanced chips to TSMC, Intel chief executive officer Lip-Bu Tan (陳立武) said yesterday. “I don’t look at people as competitors. I look at the collaboration... Nvidia is also, you know, a good friend,” Tan told a news conference following his keynote speech at the Computex trade show in Taipei. “It’s a very trusted partnership for us... We are a big, top customer for them, and we’re going to continue doing that,” he said, referring to TSMC, the world’s largest foundry
Hon Hai Precision Industry Co (鴻海精密) yesterday said it would work with US chipmaker Intel Corp to jointly develop and deploy next-generation artificial intelligence (AI) infrastructure and intelligent computing platforms in a move to capture booming demand for AI computing systems. Hon Hai, also known as Foxconn Technology Group (富士康), said in a statement that the partnership would combine its global manufacturing scale, system integration expertise and AI data center deployment capabilities with Intel’s strengths in processor architecture, silicon technologies and software ecosystem. The companies said they plan to work on equipment used in AI data centers, including server racks powered by
HSBC Holdings PLC is deepening its commitment to Taiwan as the economy emerges as one of the bank’s fastest-growing markets globally, driven by an artificial intelligence (AI) investment boom, expanding cross-border trade, and rising wealth creation. “The advantage that Taiwan has is a growth story linked to the semiconductor and broader AI industries, strong underlying corporate performance, and wealth creation,” said Surendra Rosha, HSBC’s co-chief executive for Asia and the Middle East, in an exclusive interview with the Taipei Times on June 2, during this year’s HSBC Taiwan Conference. That combination has helped HSBC cement its position as the most profitable international
RSS