Foxconn Chairman Liu Young-way said the company needs to be cautious amid tightening monetary policy, geopolitical tensions and rising inflation, despite its server business being a bright spot due to the AI boom.
“As more and more people use ChatGPT, you can see the AI server market growing much faster than expected. We estimate that the second half of the year will see a triple-digit increase,” said a Foxconn executive.
In the first quarter of 2023, Foxconn's network and cloud products segment, which includes servers, accounted for 22% of total revenue, second only to the smart consumer electronics segment (56%).
However, the company's first-quarter net profit fell 56%, the most in three years, and it said its outlook for the full year was "limited".
Apple’s manufacturing partner is looking to replicate its success with the iPhone in electric vehicles (EVs). The company has acquired a former General Motors plant in Ohio and hired former Nissan executive Jun Seki to lead its EV expansion efforts.
Liu said the company is considering expanding its EV battery supply chain beyond Taiwan, possibly to the US, Indonesia and India.
The move shows Foxconn's diversification of production outside China, where strict Covid-19 restrictions forced its largest iPhone assembly plant there to halt operations last year.
The company is also looking to avoid potential business impacts caused by rising trade tensions between Washington and Beijing.
(According to Reuters)
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