Hon Hai Precision Industry Co (鴻海精密) yesterday reported strong growth in sales last month, potentially raising expectations for iPhone sales while artificial intelligence (AI)-related business booms.
The company, which assembles the majority of Apple Inc’s smartphones, reported a 19.03 percent rise in monthly sales to NT$510.9 billion (US$15.78 billion), from NT$429.22 billion in the same period last year. On a monthly basis, sales rose 14.16 percent, it said.
The company in a statement said that last month’s revenue was a record-breaking April performance.
Photo: Reuters
Hon Hai, known also as Foxconn Technology Group (富士康科技集團), assembles most iPhones, but the company is diversifying its business to put greater focus on building data center server racks and other equipment for AI clusters. That has helped its stock reach a record high this year.
With Apple’s business making up more than half of its revenue, its investors are watching the Taiwanese company for clues on iPhone sales. Hon Hai posted about a 10 percent plunge in first-quarter revenue, in part because Apple’s flagship device underperformed.
The second quarter remains a traditional off-peak season and a transition period for major products, Hon Hai said.
Visibility for the second quarter is approximately in line with market expectations, with operations outlook for the period expected to show quarter-on-quarter and year-on-year growth, Hon Hai said.
“Hon Hai may face hurdles boosting its iPhone-related revenue in 2024 given first-quarter’s downbeat demand and the swirl of unknowns clouding the broader picture. Despite being the iPhone’s largest producer, Hon Hai’s margins may be at increased risk from diminished scale economies within the iPhone business, and the steady capacity relocation to India,” Bloomberg Intelligence analyst Steven Tseng (曾緒良) said.
In the first four months of the year, Hon Hai’s cumulative sales totaled NT$1.83 trillion, down 3.11 percent from NT$1.89 trillion a year earlier, company data showed.
Separately, Largan Precision Co (大立光) yesterday reported sales of NT$3.46 billion for last month, up 0.18 percent from March and 20.1 percent higher than a year earlier, which was in line with the company’s expectations.
The smartphone camera lens supplier’s cumulative sales in the first four months were NT$14.77 billion, up 23.01 percent from a year earlier, Largan said in a statement.
The company said sales last month grew for the ninth consecutive month on an annual basis and is expected shipment momentum to stay strong this month.
High-end products of 20 megapixels or greater accounted for 20 to 30 percent of the company’s sales last month, and between lenses of 10 and 20 megapixels accounted for 50 to 60 percent of sales, while 8 megapixel products accounted for less than 10 percent, and products in the “other” category made up 10 to 20 percent, it said.
Additional reporting by staff writer
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