Record quarter for Foxconn thanks to AI servers, growth in 2025 is a bit muted

Foxconn has almost doubled its net profit in the first three months of this year compared to 2024, with sales growing by 24% year-on-year. The world's largest manufacturer of electronic products owes this mainly to artificial intelligence (AI), as demand for the corresponding servers shows no sign of abating. The electric car business is also slowly gaining momentum, but the outlook for the year as a whole is somewhat more cautious than before due to the geopolitical situation and currency fluctuations.

Foxconn had already stated in March that Trump's tariffs were causing the tech giant “major headaches”. Due to the sometimes erratic and unpredictable policies of the new US government under Donald Trump, it is “very, very difficult to predict how things will develop next year”, Young Liu, CEO of the Taiwanese company, had stated at the time. Added to this is a stronger Taiwan dollar, which is causing revenues to fall in the correspondingly weaker US dollar.

Foxconn expects significant growth in 2025

Nevertheless, Foxconn, formally the “Hon Hai Technology Group”, expects “significant growth” this year, but had previously assumed “strong growth” in 2025. There was little sign of this in the first quarter, as the Group was able to increase sales by 24%, operating profit by 27% and net profit by as much as 91% compared to the same period last year. Foxconn also expects further significant growth in the current second quarter, traditionally a weaker phase of the year. According to the company, this is thanks to the cloud and network product segments as well as components.

The international orientation of the Taiwanese group, which now produces in 24 different countries, should also help. In addition to Asia as a base, Foxconn refers to over 50 locations on the American continents, as well as more than 10 locations each in Europe and India. This means that there are a total of 233 production sites worldwide. This also includes the USA, where Foxconn and Wistron are building factories for the production of Nvidia servers. However, this was initiated before Trump came to power and is not a reaction to his tariff policy.

Foxconn's e-cars for Mitsubishi

Foxconn Chairman Liu was also positive about the cooperation with Mitsubishi regarding electric cars. Just last week, it was agreed with the Japanese company that Foxconn would develop and manufacture an electric car model for Mitsubishi. Liu expects to support Mitsubishi in selling this model in Australia and Oceania. This is an important milestone for Foxconn's electric car business. Liu hopes for further cooperation of this kind with other car brands but, according to Reuters, only confirmed talks with other Japanese car manufacturers and did not want to name them.

The stock market reacted positively to the developments at Foxconn. The group's share price has fallen by over 11 percent since the beginning of the year, which was mainly due to Trump's tariff policy. However, the stock has now gained 2.6 percent in value.

(fds)