Hon Hai Precision Industry Co’s (鴻海精密) annual sales growth slowed last month compared with the previous few months, signaling that tariff-induced uncertainties are affecting electronics demand.
Sales rose 7.25 percent year-on-year to NT$613.87 billion (US$20.5 billion), its slowest growth since January, Hon Hai said in a statement on Tuesday.
Still, last month’s sales were the highest figure for July in the company’s history, Hon Hai said.
Photo: Cheng I-hwa, AFP
Sales in the first seven months of this year totaled NT$4.05 trillion, a 17.62 percent increase from the same period last year and also the highest ever for the period, said the company, also known as Foxconn Technology Group (富士康科技集團).
Analysts were looking for a 12.2 percent increase in third-quarter revenue. Nvidia Corp’s main server assembly partner, Hon Hai, which also assembles Apple Inc’s iPhones, said it expects third-quarter sales to grow sequentially and year-on-year.
However, “the impact of evolving global political and economic conditions, and exchange rate changes, will need continued close monitoring,” Hon Hai said.
Last week, US President Donald Trump set a 20 percent levy on Taiwan’s exports to the US. While electronics are exempt, they might be affected by the outcome of a US investigation under Section 232 of the Trade Expansion Act of 1962, which includes probes into sectors such as semiconductor products.
Still, there might be bright spots for Hon Hai later this year.
The world’s largest tech companies are raising capital spending further this year to keep ahead in an escalating artificial intelligence (AI) race. Microsoft Corp, Amazon.com Inc, Alphabet Inc and Meta Platforms Inc are expected to collectively spend more than US$344 billion this year, with much of the amount devoted to AI data centers.
Nvidia alone has outlined plans to produce as much as half a trillion dollars’ worth of AI infrastructure in the US over the next few years, through manufacturing partners including Hon Hai.
Hon Hai seeks to ride that wave. It is expanding its AI server assembly capacity in the US, selling an electric vehicle plant in Ohio under an arrangement in which the Taiwanese company would use the plant to manufacture AI servers, Bloomberg reported.
Hon Hai might also have benefited from the strong demand for Apple devices. The iPhone maker just reported its fastest quarterly revenue growth in more than three years on solid demand in China and said its sales in the current quarter would grow mid-to-high single digits year-on-year.
Additional reporting by staff writer
WEAKER ACTIVITY: The sharpest deterioration was seen in the electronics and optical components sector, with the production index falling 13.2 points to 44.5 Taiwan’s manufacturing sector last month contracted for a second consecutive month, with the purchasing managers’ index (PMI) slipping to 48, reflecting ongoing caution over trade uncertainties, the Chung-Hua Institution for Economic Research (CIER, 中華經濟研究院) said yesterday. The decline reflects growing caution among companies amid uncertainty surrounding US tariffs, semiconductor duties and automotive import levies, and it is also likely linked to fading front-loading activity, CIER president Lien Hsien-ming (連賢明) said. “Some clients have started shifting orders to Southeast Asian countries where tariff regimes are already clear,” Lien told a news conference. Firms across the supply chain are also lowering stock levels to mitigate
IN THE AIR: While most companies said they were committed to North American operations, some added that production and costs would depend on the outcome of a US trade probe Leading local contract electronics makers Wistron Corp (緯創), Quanta Computer Inc (廣達), Inventec Corp (英業達) and Compal Electronics Inc (仁寶) are to maintain their North American expansion plans, despite Washington’s 20 percent tariff on Taiwanese goods. Wistron said it has long maintained a presence in the US, while distributing production across Taiwan, North America, Southeast Asia and Europe. The company is in talks with customers to align capacity with their site preferences, a company official told the Taipei Times by telephone on Friday. The company is still in talks with clients over who would bear the tariff costs, with the outcome pending further
Six Taiwanese companies, including contract chipmaker Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), made the 2025 Fortune Global 500 list of the world’s largest firms by revenue. In a report published by New York-based Fortune magazine on Tuesday, Hon Hai Precision Industry Co (鴻海精密), also known as Foxconn Technology Group (富士康科技集團), ranked highest among Taiwanese firms, placing 28th with revenue of US$213.69 billion. Up 60 spots from last year, TSMC rose to No. 126 with US$90.16 billion in revenue, followed by Quanta Computer Inc (廣達) at 348th, Pegatron Corp (和碩) at 461st, CPC Corp, Taiwan (台灣中油) at 494th and Wistron Corp (緯創) at
NEGOTIATIONS: Semiconductors play an outsized role in Taiwan’s industrial and economic development and are a major driver of the Taiwan-US trade imbalance With US President Donald Trump threatening to impose tariffs on semiconductors, Taiwan is expected to face a significant challenge, as information and communications technology (ICT) products account for more than 70 percent of its exports to the US, Chung-Hua Institution for Economic Research (CIER, 中華經濟研究院) president Lien Hsien-ming (連賢明) said on Friday. Compared with other countries, semiconductors play a disproportionately large role in Taiwan’s industrial and economic development, Lien said. As the sixth-largest contributor to the US trade deficit, Taiwan recorded a US$73.9 billion trade surplus with the US last year — up from US$47.8 billion in 2023 — driven by strong
RSS