Taiwan-based Foxconn’s quarterly profit in the second quarter of this year exceeded expectations due to strong demand from partners such as Apple for high-tech products. Due to the pandemic, people still often prefer to interact at a distance and they need more and more appropriate electronics.
Net profit of the Taiwanese manufacturer for April-June of this year amounted to $ 1.07 billion, up 30% over the second quarter of last year. This is higher than analysts’ forecasts, who had expected indicators in the region of $ 934 million. The company’s revenue for the specified period grew by 20% compared to last year to $ 48.55 billion, this is a record figure for the second quarter, exceeding the company’s promised quarterly growth by 15%.
According to the head of the company David Huang (David Huang), growth “Mainly driven by strong demand for smartphones”… According to other company representatives, the pandemic situation in Asia could get worse, so it is worth waiting and seeing how this affects the supply chain. It is possible that the shortage of chips could last until the second quarter of 2022, but this will have “very little” impact on Foxconn, since many of the company’s customers are among the “first tier” manufacturers with powerful leverage on partners.
In July, Apple said the chip shortage was affecting the company’s ability to supply iPads and computers in the required quantities and could interfere with the production of iPhones in the required quantities, resulting in a slowdown in profit growth.
Despite such forecasts, analysts continue to say that the release of the Apple iPhone 13 will give new impetus to the growth of Foxconn’s business. According to the calculations of the Taiwanese consulting company Fubon Securities this year Foxconn will produce 75% of all iPhones, the number of which will reach 85 million copies. As the shortage spills over into new industries, Foxconn is looking to acquire more chip factories around the world.
Foxconn, formally referred to as Hon Hai Precision Industry Co Ltd, is expected to grow 3-15% in total revenues in the third quarter, while revenue from the Consumer Electronics division is expected to increase more than 15% over the same period last year. …
Foxconn shares are up 16% since the beginning of the year.