Hon Hai Precision Industry Co (鴻海精密) predicts three-digit percentage growth for its artificial intelligence (AI) server business due to robust demand for AI products such as ChatGPT, chairman Young Liu (劉揚偉) said yesterday.
Hon Hai — known globally as Foxconn Technology Group (富士康科技集團) — is the world’s biggest contract electronics manufacturer and assembles devices for many international brands, most notably Apple Inc’s iPhone products.
It has also moved to diversify beyond electronics assembly, expanding into areas ranging from electric vehicles to semiconductors and servers.
Photo: CNA
“In 2022 alone, Hon Hai’s revenue for servers reached NT$1.1 trillion [US$35.75 billion] to obtain a 40 percent global market share,” Liu told an annual shareholders’ meeting in Taipei.
AI servers made up about 20 percent of the company's total server sales last year, Liu said, adding that Hon Hai had taken advantage of solutions provided by Intel Corp, Advanced Micro Devices Inc and ARM Ltd to roll out AI servers.
Hon Hai ranks first in global market share for mobile phones, PCs and servers, with the AI server market now “rising faster than everyone has expected,” Liu said.
He attributed the jump in demand to ChatGPT, the AI program that burst into the spotlight late last year with the ability to generate essays, poems and conversations from the briefest of prompts. Its runaway success has sparked a gold rush with billions of dollars of investment in the field.
“For the second half of this year, we may have three-digit growth, not two digits... We will continue to boost our market share for servers,” Liu said.
He said the company’s latest AI servers also use Nvidia Corp chips.
Nvidia is known for creating graphics chips long coveted by gamers, but which have become engines for the kind of complex processes involved in AI, known as accelerated computing.
Nvidia, cofounded by Taiwanese-American Jensen Huang (黃仁勳), surged to a market value of more than US$1 trillion on Tuesday after its quarterly earnings report last week blew past expectations.
Despite the rosy future for AI, Hon Hai maintains a “flat” outlook for this year, Liu said, after its first-quarter profit plunged 56 percent on weakened demand due to a global downturn.
“The global tightening monetary [policies], coupled with tense geopolitics and the significant uncertainty of inflation have a relatively large impact on the economic outlook,” he said.
Meanwhile, Hon Hai has started trial production of a third-generation silicon carbide (SiC) semiconductor for use in electric vehicles for five clients, Liu said, adding that a 6-inch SiC wafer plant in Hsinchu acquired from Macronix International Co (旺宏電子) in 2021 has begun commercial production.
According to Hon Young Semiconductor Corp (鴻揚半導體), a Hon Hai subsidiary, the Hsinchu plant will be upgraded to an 8-inch wafer plant by 2025 with an ultimate annual production capacity of up to 200,000 units.
At the meeting, Hon Hai shareholders approved a proposal to issue NT$5.3 in cash dividend per share based on the company's earnings per share of NT$10.21 last year.
The cash dividend, the highest since the company launched an initial public offering in 1991, represents a payout ratio of 52 percent and is the fourth consecutive year Hon Hai has maintained a payout ratio above 50 percent.
Additional reporting by CNA
CHAOS: Iranians took to the streets playing celebratory music after reports of Khamenei’s death on Saturday, while mourners also gathered in Tehran yesterday Iranian Supreme Leader Ayatollah Ali Khamenei was killed in a major attack on Iran launched by Israel and the US, throwing the future of the Islamic republic into doubt and raising the risk of regional instability. Iranian state television and the state-run IRNA news agency announced the 86-year-old’s death early yesterday. US President Donald Trump said it gave Iranians their “greatest chance” to “take back” their country. The announcements came after a joint US and Israeli aerial bombardment that targeted Iranian military and governmental sites. Trump said the “heavy and pinpoint bombing” would continue through the week or as long
TRUST: The KMT said it respected the US’ timing and considerations, and hoped it would continue to honor its commitments to helping Taiwan bolster its defenses and deterrence US President Donald Trump is delaying a multibillion-dollar arms sale to Taiwan to ensure his visit to Beijing is successful, a New York Times report said. The weapons sales package has stalled in the US Department of State, the report said, citing US officials it did not identify. The White House has told agencies not to push forward ahead of Trump’s meeting with Chinese President Xi Jinping (習近平), it said. The two last month held a phone call to discuss trade and geopolitical flashpoints ahead of the summit. Xi raised the Taiwan issue and urged the US to handle arms sales to
State-run CPC Corp, Taiwan (CPC, 台灣中油) yesterday said that it had confirmed on Saturday night with its liquefied natural gas (LNG) and crude oil suppliers that shipments are proceeding as scheduled and that domestic supplies remain unaffected. The CPC yesterday announced the gasoline and diesel prices will rise by NT$0.2 and NT$0.4 per liter, respectively, starting Monday, citing Middle East tensions and blizzards in the eastern United States. CPC also iterated it has been reducing the proportion of crude oil imports from the Middle East and diversifying its supply sources in the past few years in response to geopolitical risks, expanding
Pro-democracy media tycoon Jimmy Lai’s (黎智英) fraud conviction and prison sentence were yesterday overturned by a Hong Kong court, in a surprise legal decision that comes soon after Lai was jailed for 20 years on a separate national security charge. Judges Jeremy Poon (潘兆初), Anthea Pang (彭寶琴) and Derek Pang (彭偉昌) said in the judgement that they allowed the appeal from Lai, and another defendant in the case, to proceed, as a lower court judge had “erred.” “The Court of Appeal gave them leave to appeal against their conviction, allowed their appeals, quashed the convictions and set aside the sentences,” the judges
RSS