Foxconn Boosts Full-Year Outlook on Strong Tech Demand

Foxconn, one of the world’s largest contract electronics manufacturers, boosted its full-year business outlook due to robust tech sales ranging from smartphones to servers, despite fears about decreasing demand due to rising inflation.

The Taiwanese company, like other worldwide manufacturers, has been dealing with a significant chip scarcity, which has hampered smartphone production, notably for its major client Apple, in part due to COVID-19 lockdowns in China. However, the company’s June sales increased 31 percent year on year to a record high, due to effective supply chain management and rising sales of consumer goods, notably smartphones, which account for the majority of its income. Foxconn’s higher-than-expected June sales come at a time when investors are concerned about weakening electronics demand as major markets decline due to high inflation and the Ukraine war. Global semiconductor stocks fell on Friday after memory chip maker Micron Technology Inc anticipated significantly lower-than-expected revenue for the current quarter on Thursday and said the market had ‘weakened considerably in a very short period of time’.

Foxconn said in a statement it was optimistic about its business in the third quarter, saying it could see ‘significant growth’ compared with a year earlier.

For 2022, Foxconn said the outlook has improved and it exceed its expectations for no growth, without providing details.

The company, officially known as Hon Hai Precision Industry, stated that sales of servers and telecoms gear have increased by double digits this year. The corporation claims that COVID-19 regulations in China had only a little impact on output since it kept personnel on-site in a ‘closed loop’ system. The shares ended down 1 percent, roughly in line with the broader market. They have fallen 3.9 percent so far this year, giving the company a market worth of $49.3 billion.