Foxconn, a subsidiary of Hon Hai Precision Industry Co. Ltd (OTC: HNHPF), which manufactures Apple Inc's (NASDAQ: AAPL) flagship iPhone, has reported first quarter results. The first quarter was typically a slow period, so it's no surprise that Foxconn posted a significant decline in revenue. However, Foxconn expects revenue to increase in the second quarter, even though it is still the off-peak season.
First quarter highlights
In the first quarter, Foxconn posted a 9.6% revenue decline, but the Apple supplier noted that its cloud and networking division reported strong revenue growth. However, the total revenue decreased by 28.58% compared with the previous fourth quarter, amounting to NT$1.32 trillion, equivalent to about $41.2 billion. But the fourth quarter is usually the time when suppliers compete to help tech giants like his Apple meet holiday season demand. However, according to Counterpoint Research, overall smartphone shipments decreased by 3.2% in 2023.
AI hype is all the rage
Foxconn lags behind AI chip manufacturing leader Nvidia Corporation (NASDAQ: NVDA), but it has nonetheless gained momentum recently.
See more earnings at HNPF
As a reminder, Foxconn partnered with Nvidia last year. Foxconn and Nvidia are planning a specific “AI factory,” a new class of data centers that will use Nvidia chips to power all kinds of applications, from large-scale language models to self-driving car training. Participated in development. Foxconn will also develop a smart solutions platform based on technology developed by Nvidia. Gaining access to Nvidia's solutions will enable Foxconn to deliver safe, AI-powered EVs and make its mark in a new era. Simply put, Nvidia collaborated with Foxconn to accelerate his AI industrial revolution. Given that AI development requires more than chips, even Nvidia, the Almighty, cannot do everything alone, so there is room for all kinds of industry contributors to participate, and this is Foxconn It's a good omen for
Despite traditional off-peak periods and recent earthquakes, March sales growth from consumer electronics and cloud demand allows Apple's suppliers to expect higher sales in the second quarter. Ta. Foxconn stock has also risen about 21% since the beginning of the year.
Rebound expectations are based on AI
Weak sales provide little hope for a recovery for Apple's star iPhone, but rising demand for AI servers has Foxconn expecting a second-quarter revenue recovery and optimism for the year ahead. I was able to get perspective.
Disclaimer: This content is for informational purposes only. It is not intended as investment advice.
This article was contributed by an unpaid external contributor. This does not represent Benzinga's reporting and has not been edited for content or accuracy.
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This Article Apple's Suppliers Report Drop in Revenue, but Hopes for Future Growth as AI Revolution Creates Room for Contributors
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