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Foxconn Boosts Q3 Outlook on Surging AI Server Demand
Foxconn, a major supplier for Apple and the world's largest contract electronics manufacturer, announced that its third-quarter performance is poised to outperform market expectations. The company attributed the optimistic outlook to sustained, strong demand for its artificial intelligence (AI) related products.
AI Strength Drives Upgraded Forecast
In a statement released Saturday, Foxconn said that its operational visibility for the third quarter has improved, with overall performance now expected to be better than previously anticipated. The company, which is Nvidia's largest server maker, has been a significant beneficiary of the global build-out of AI infrastructure.
"In the third quarter, as AI demand continues to grow, and ICT products also enter the peak season of the second half of the year, operations are expected to gradually gain momentum," the company stated. This follows a strong second quarter, where Foxconn reported a 35% rise in profit, also beating analyst forecasts.
Record August Revenue
Supporting its positive outlook, Foxconn reported record-setting revenue figures for August. The company, formally known as Hon Hai Precision Industry, does not provide specific numerical forecasts but its monthly revenue serves as a key performance indicator for investors.
AdKey figures for August include:
- Revenue: T$921.8 billion ($29.15 billion)
- Year-over-year growth: +51.98%
- Milestone: The highest revenue ever recorded for the month of August and the second consecutive month above the T$900 billion mark.
Market Context and Caution
Investors reacted positively ahead of the announcement, with Foxconn's shares closing up 3.4% on Friday, outperforming the broader Taiwanese market's 1.5% gain. The company's performance is closely watched as a barometer for global electronics demand.
Despite the strong forecast, Foxconn offered a note of caution, stating it was necessary to "monitor the impact of the volatile global political and economic situation." The company did not provide further details on the specific risks it was monitoring.
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