Hon Hai Precision Industry Co (鴻海) has invested US$142 million in Texas, which industrial sources close to the deal said was aimed at expanding its artificial intelligence (AI) server capacity.
The company has acquired a 34.9 hectare lot in Houston and a 92,903m2 building through its cloud solution subsidiary Ingrasys Technology Inc (鴻佰), Hon Hai said in a filing with the Taiwan Stock Exchange on Monday.
Hon Hai, also known as Foxconn Technology Group (富士康), did not specify the purpose of the investment, saying only that it was for operational needs, the filing showed.
Photo: Bloomberg
However, sources said it would be used to expand AI server production to initially cater to clients in North America, except Apple Inc, which last month said it would partner with Hon Hai to build an AI server assembly plant in Houston by next year.
Hon Hai is expanding AI server capacity in Taiwan, the US, Mexico and Vietnam to give it flexibility in adjusting high-end AI server production based on market conditions.
The company on March 14 told investors that AI server sales this year are expected to be more than NT$1 trillion (US$30.23 billion) and would account for 50 percent of its total server revenue, along with a more than 40 percent share of the global AI server market.
Hon Hai, which has invested in 24 countries and operates 233 facilities, from 2022 to last year spent more than NT$340 billion in capital expenditure to expand production globally, making it resilient amid US tariff threats, Hon Hai chairman Young Liu (劉揚偉) has said.
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