Key Points:
- Foxconn anticipates a significant revenue rise for the current year, driven by booming demand for AI servers, and expects growth of over 40% in 2024.
- Foxconn’s Q4 net profit reached T$53.1 billion, a 33% surge in profit marks the strongest year-on-year growth recorded for a quarter since March 2021.
- Consumer electronics accounted for 58% of Foxconn’s revenue in Q4, while cloud and networking products contributed 20%.
- The optimistic outlook from Foxconn aligns with Apple’s recent financial performance, which exceeded Wall Street estimates.
Foxconn, Apple’s prominent supplier and the world’s largest contract electronics maker, has announced an optimistic outlook for the upcoming year. This outlook is fueled by an anticipated increase in revenue propelled by the soaring demand for artificial intelligence (AI) servers. This bullish stance follows a remarkable 33% rise in net profit for the fourth quarter, surpassing expectations.
During an online earnings conference on Thursday, Foxconn Chairman Young Liu expressed confidence in the company’s prospects, highlighting its clients’ robust demand for AI servers. Liu revealed expectations for revenue growth of more than 40% in the current year, underpinned by the flourishing AI server market. He projected a consistent annual growth rate of 30% for the AI server market between 2023 and 2025, with Foxconn’s growth aligning closely with or surpassing this trajectory.
From October to December, Foxconn’s fourth-quarter net profit reached T$53.1 billion ($1.7 billion), significantly exceeding market expectations reflected in the T$43.5 billion LSEG SmartEstimate. This 33% surge in profit marks the strongest year-on-year growth recorded for a quarter since March 2021. The remarkable performance can be attributed to the buoyant demand for AI servers and better-than-expected sales of cloud and networking products alongside smart consumer electronics.
Consumer electronics, particularly smartphones, constituted most of Foxconn’s revenue in the fourth quarter, accounting for 58%, while cloud and networking products, including servers, contributed 20%.
This optimistic outlook from Foxconn resonates with Apple’s recent financial performance, which exceeded Wall Street estimates. Apple reported robust sales and profits in the previous month, driven primarily by growth in its iPhone business. However, its sales in China fell short of analysts’ expectations.
