Foxconn Maintains Guidance for Q1 Revenue Drop from High Basis

Apple supplier Foxconn is optimistic about 2024 and notes a significant demand for AI servers
Apple supplier Foxconn is optimistic about 2024 and notes a significant demand for AI servers

Foxconn, the world’s largest outsourced electronics manufacturer and Apple’s largest iPhone assembler, confirmed that first-quarter revenue would dip year on year following a good start.

Foxconn, the world’s largest contract electronics manufacturer and Apple’s largest iPhone assembler, reiterated on Monday that first-quarter revenue would fall year on year after a strong start.

The first quarter is generally quieter than the previous one, as Taiwan’s tech businesses compete to sell smartphones, tablets, and other devices to key vendors such as Apple for Western markets’ year-end holiday season.

Foxconn stated in a statement that overall operations in this year’s first quarter were “gradually entering the traditional off-peak season, and seasonal performance is expected to be similar to that of the past three years.”.

It was observed that in the first quarter of 2023, as manufacturers resumed normal operations following the COVID-19 pandemic, increased shipments resulted in a higher comparison base.

“The outlook for the first quarter of this year is expected to decrease year-on-year,” Foxconn stated, repeating earlier guidance.

The company does not provide numerical forecasts.

Foxconn, formally known as Hon Hai Precision Industry Co. Ltd., reported revenue of T$522.1 billion ($16.65 billion) last month, the second-highest ever for the same time, with the highest being in January.

That was a 13.5% increase month over month, but a 20.9% decrease year over year.

Compared to the previous year, sales for cloud and networking products climbed significantly in January due to new client product launches, while revenue for computing products declined slightly as personal computer demand slowed.

Foxconn Chairman Liu Young-way stated on Sunday that the company’s business this year will be “slightly better” than last year, but that it is confronting a chip scarcity for AI servers, where demand is increasing.

On March 14, Foxconn will disclose fourth-quarter earnings and provide an update on its forecast.

Foxconn’s shares fell 0.5% on Monday ahead of the release of its January results, while the overall market rose 0.2%.

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