Foxconn Beats Estimates on AI Demand
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Taiwan's Foxconn, the world's largest contract electronics maker, exceeded expectations in the fourth quarter, achieving record revenue driven by strong demand for artificial intelligence (AI) servers, Reuters reports.
Revenue surged 15.2% year-on-year to T$2.13 trillion (approximately $64.72 billion), surpassing the anticipated T$2.1 trillion LSEG SmartEstimate. This impressive performance surpasses previous records and highlights the company's success in navigating the global technology landscape.
Foxconn's success is attributed primarily to robust demand for AI servers, propelling growth in its cloud and networking products division. Notably, the company counts leading AI chip manufacturer Nvidia among its clients. In contrast, the sector encompassing smart consumer electronics, including iPhones, experienced "roughly flattish" year-on-year growth.
December alone witnessed a substantial 42.3% year-on-year jump in revenue, reaching T$654.8 billion. This figure represents the second-highest December revenue in the company's history.
Foxconn's optimistic outlook for the current quarter suggests continued strength, despite the typical seasonal slowdown. The company anticipates that first-quarter revenue, while potentially experiencing a slight sequential dip, will remain in line with historical averages and show significant year-on-year growth.
"In the first quarter of 2025, overall operations have gradually entered the traditional off-season," Foxconn stated. "Even with record high revenue in the fourth quarter of 2024, the sequential performance of the first quarter will reach roughly similar levels that are average to the past five years; compared with a year ago, it should show significant growth."
Foxconn's impressive performance is reflected in its share price, which experienced a remarkable 76% surge in 2024, significantly outperforming the broader Taiwan market's 28.5% rise. The company's full fourth-quarter earnings report is scheduled for March 14. The company's success underscores the burgeoning demand for AI technology and its role in shaping the future of the tech industry.