Strong demand for AI! Hon Hai's sales in December surged by 42%, and Q1 revenue is expected to grow significantly
Hon Hai expects that this year its cloud business (including AI servers) will have revenue on par with its iPhone manufacturing business
Boosted by AI demand, Hon Hai's latest revenue data shows strong growth.
On January 5th, Hon Hai Precision Industry Co., Ltd., the parent company of Foxconn, stated that revenue in the past three months reached NT$2.13 trillion (approximately USD 64.6 billion), a year-on-year increase of 15%, exceeding analysts' expectations of 13%; revenue for December alone reached NT$654.83 billion, a year-on-year increase of 42%.
Hon Hai also expects that sales in the first quarter of 2024 will achieve significant growth, and by 2025, its cloud business (including AI servers) will match the revenue of its iPhone manufacturing business.
As an AI hardware supplier, Hon Hai has benefited in recent years from strong demand and massive spending from U.S. tech giants like Google and Microsoft in data center servers. However, due to the still unclear application scenarios for AI, some investors are concerned about the potential slowdown in expansion.
In addition to AI, Hon Hai is also committed to entering the electric vehicle market, although it has not yet had a substantial impact on its earnings. According to previous media reports, the company had contacted Renault regarding cooperation with Nissan, but this plan has been temporarily shelved as Nissan and Honda have begun merger negotiations