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Bloomberg

Foxconn Technology Group's quarterly earnings missed estimates as weak iPhone sales in China weighed and it invested more on artificial intelligence (AI) server production.
The Taiwanese electronics contract manufacturer, a major assembler of Nvidia servers and Apple's main iPhone supplier, reported a 13 per cent fall in net income to NT$46.3 billion (US$1.4 billion). That compared with analysts’ estimates for a 2.3 per cent gain to NT$54.4 billion.
Foxconn's server manufacturing arm has expanded alongside the boom in demand for the Nvidia chips that drive AI development. However, it still derives most of its revenue from iPhones, and Apple reported a surprise decline in sales of its flagship device during the holiday quarter.
The Taiwanese firm, formally known as Hon Hai Precision Industry, in January revealed a deceleration in December-quarter sales.
While Big Tech firms from Microsoft to Amazon.com have pledged to keep spending on data centres, Chinese AI start-up DeepSeek’s rise has spurred doubts about whether all that expenditure is justified.

Foxconn, which ships electronics to the rest of the world from giant production bases in China, is also grappling with uncertainty surrounding US tariffs in 2025.
“Sequential growth may have slowed in the fourth quarter due to a model transition, but could pick up again in the first quarter,” said Bloomberg Intelligence analysts Steven Tseng and Sean Chen.
“The computing segment could have delivered stronger than expected growth due to AI personal-computer penetration and earlier order pull-in ahead of tariff hikes," the analysts said. "The component business might have sustained sales momentum on an expansion of the automotive unit and increasing vertical integration."
“Yet the smart consumer electronics division could have been muted as iPhone demand tumbled in China," they added.
Still, the analysts expect Foxconn profit to jump on rapid sales growth, "but gross margin might be diluted due to lower profitability of high-price AI servers".
Analysts for now expect AI demand to help revive Foxconn’s top-line in 2025. Sales for the first two months of this year jumped 25 per cent, quickening from last year.
That reflects Nvidia’s US$11 billion in quarterly revenue from its most advanced Blackwell chip, which it called “the fastest product ramp” in the company’s history.
Foxconn has been expanding its investments in the US to make more AI servers there.
Last month, Apple said it would partner with Foxconn to begin producing servers that power Apple Intelligence in Houston. Yet the Taiwanese firm is continuing to build what it has called the world’s biggest AI server assembly plant in Mexico as well.


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The Taiwanese company reported a 13 per cent fall in net income, worse than analysts’ estimates for a 2 per cent gain


The Taiwanese company reported a 13 per cent fall in net income, worse than analysts’ estimates for a 2 per cent gain.


Foxconn’s profits drop as iPhone sales falter, but AI boom offers hope

.css-1c6uqr6{color:inherit;font-weight:inherit;font-size:inherit;font-family:inherit;line-height:inherit;overflow-wrap:break-word;}The Taiwanese company reported a 13 per cent fall in net income, worse than analysts’ estimates for a 2 per cent gain

The Taiwanese company reported a 13 per cent fall in net income, worse than analysts’ estimates for a 2 per cent gain