Apple supplier Foxconn exceeded expectations with a 6% profit rise, driven by AI server demand, affirming strong full-year growth.
The world’s largest electronics maker anticipates strong AI server demand to drive growth into the fourth quarter.
Foxconn confirmed Nvidia’s GB200 chip development is on track, with small deliveries starting Q4 and increasing in 2025.
“If the schedule remains unchanged, the performance of the entire AI server segment may be better than originally estimated,” Foxconn vice president and spokesman James Wu said.
Wu highlighted Foxconn’s dominant AI server market position, holding over 40% global share, adding it’s tough for competitors to challenge.
“That will not be changed in a short time,” he said.
The Taiwanese company reported a net profit increase to T$35.05 billion in April-June, up from T$33 billion last year.
That outperformed experts’ average expectation of T$34.29 billion.
The company’s profits increased for the fourth consecutive quarter.
Foxconn reported AI servers comprised over 40% of its Q2 server business, forecasting them as its next trillion-dollar product.
The company aims to replicate iPhone success in EVs and expects to finalize talks with two Japanese carmakers this year.
“Rub your eyes and wait,” Wu said, without naming the companies.
Foxconn predicts a “flattish” smartphone outlook for the full year, but expects a stronger second half compared to 2023.
The company anticipates significant third-quarter revenue growth, though smart consumer electronics revenue, including smartphones, may remain flat.
Foxconn, formally Hon Hai Precision, expects operations to improve in the second half as electronics vendors, like Apple, release new products.
Before the earnings announcement, KGI Securities raised Foxconn’s sales forecast, anticipating strong iPhone and AI server demand to boost the outlook.
Foxconn shares rose 2.5% before the results announcement.
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