Apple supplier Foxconn posts better-than expected second-quarter profit

Joanna Estrada
August 12, 2020

Mr Liu said. Foxconn - also known as Hon Hai - reported a 34pc increase in quarterly profits on the back of booming demand for cloud computing equipment related to more internet use during the pandemic, and as production recovered from coronavirus-induced shutdowns at the start of the year.

The Taipei-based company, however, is expected by analysts to boost its revenue recovery in the months ahead, underpinned by the expected launch in autumn of a new lineup of iPhones by Apple Inc, a major client of Foxconn's.

That was up about 34% from a year earlier according to Reuters calculations and better than a consensus estimate of T$17.95 billion drawn from 13 analysts polled by Refinitiv.

Foxconn, which has just reported second quarter profits 34% up from previous year, is now said to believe China's manufacturing supremacy is over.

The only answer, it seems, is to have a branch of Foxconn that only uses Chinese labour, materials and intellectual property for the Chinese market and one that doesn't use anything Chinese for the USA and most of the rest of the world.

More than 70% of the new iPhones could be assembled by Foxconn, helping the firm's revenue resume growth in the fourth quarter, Taipei-based KGI Securities said. Its gross margin was 5.91% in the second quarter.

Apple's manufacturing partner Foxconn reportedly said there will be a manufacturing ecosystem in every region be it India, Southeast Asia or America. Chairman Young Liu told Bloomberg while adding that China will still play a key role for Foxconn but "the country's days as the world's factory are done".

Other reports by Click Lancashire

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