(Bloomberg) — Hon Hai Precision Industry Co. posted a better-than-projected 27% rise in quarterly earnings, reflecting how AI demand is helping the Taiwanese company weather a moribund global consumer electronics market.
Hon Hai, which makes servers for Nvidia Corp., reported net income of NT$44.36 billion ($1.5 billion) for the June quarter, versus an average projection for NT$36.14 billion. The company, also known as Foxconn, previously reported a 16% sales increase for the period.
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Hon Hai is navigating abrupt and unpredictable geopolitical shifts while it tries to diversify its manufacturing footprint. It cut its full-year revenue guidance in May, citing potential fallout from a US-China trade war. Donald Trump has declared plans for a 100% tariff on semiconductor imports, though he’s promised to exempt companies that move production to the US.
Hon Hai, which makes most of Apple Inc. iPhones, is already grappling with tepid consumer demand globally during an economic downturn.
The Taiwanese company gets a significant chunk of revenue from the iPhone maker, though AI servers have fast become its main growth driver. It’s indicated that while overall sales will still grow in 2025, it will be at a slower pace than previously expected.
An appreciating Taiwan dollar is also weighing on its financials. Every NT$1 rise against the greenback on a yearly average will reduce Hon Hai’s revenue by about 3%, its executives have estimated.
–With assistance from Vlad Savov.
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