(Bloomberg) — Nvidia Corp.’s server assembly partner Hon Hai Precision Industry Co. reported a stronger-than-expected increase in quarterly sales, a sign of sustained AI demand.
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Revenue grew 52% in June, the company said Sunday. That indicates Hon Hai’s sales for the June quarter rose almost 40% to NT$2.51 trillion ($79 billion), according to Bloomberg calculations. Analysts on average had expected NT$2.37 trillion.
Hon Hai, also known as Foxconn, has established itself as a key AI hardware player by assembling servers that house Nvidia accelerators. Alphabet Inc., Amazon.com Inc., Meta Platforms Inc. and Microsoft Corp. are setting aside about $725 billion for AI spending this year, even as warnings abound about overcapacity and questions about how to monetize the technology persist.
Concerns about a rush to build power-guzzling data centers have also grown since the start of conflict in the Middle East, which has piled pressure on global shipping routes and gas prices.
The Taiwanese company in March projected strong sales growth in 2026, fueled by sustained AI momentum. It derives a significant chunk of sales from assembling Apple Inc.’s iPhones and MacBooks and is in a position to benefit from any positive reception for the latest iPhone 17 product family.
But like many electronics manufacturers, Hon Hai faces a shortage of memory chips used in a wide range of products from smartphones to PCs and servers. Executives have said the crunch should not significantly impact demand for premium handset and computer products the company makes for major customers.
–With assistance from Twinnie Siu and Stanley James.
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