(Bloomberg) — Hon Hai Precision Industry Co.'s stock has soared to an all-time high, posting the strongest monthly sales growth since the start of 2023, potentially raising expectations for iPhone and AI server sales. be.
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The company, which assembles the majority of Apple Inc.'s smartphones, reported monthly revenue of NT$429.2 billion (approximately $15.8 billion) in April 2023, an increase of 19% to NT$510.9 billion ($15.8 billion). It was reported that it happened. This was a record for the month, Hong said. Mr. High said in his statement: The company's stock rose as much as 6.7% on Monday, its highest intraday level in nearly two weeks.
Hon Hai, also known as Foxconn, makes most of the world's iPhones, but it is diversifying to focus more on building server racks for data centers and other equipment for artificial intelligence clusters.
Read more: Apple's surprising iPhone growth in China leaves doubts
Still, with Apple's business accounting for more than half of its sales, investors are eyeing the Taiwanese company for clues about iPhone sales. Sales in the first quarter fell nearly 10%, due in part to weak performance for Apple's flagship devices. The Taiwanese company will release its full quarterly earnings next week.
“Among product lines, the computing segment had the strongest month-over-month growth, primarily due to the launch of Apple's new MacBook Air,” Citigroup analysts said in a research note. “Demand for iPhones was also strong ahead of China's Labor Day holiday.''
Hon Hai said in a statement that the second quarter is still the traditional slow period, and major products are in the transition period between old and new. The company said its outlook for the second quarter is broadly in line with current market expectations, and the business is expected to show both quarter-over-quarter and year-over-year growth in the period.
Apple surprised investors on Thursday by posting significantly higher quarterly sales from China, ignoring a lot of negative data on iPhone sales. This difference could be due to differences in how independent analysts described the business or because the average selling price was higher than expected.
Bloomberg intelligence statement
Given weak demand in the first quarter and unknowns clouding the picture, Honghai may face hurdles to boost iPhone-related revenue in 2024. Despite being the iPhone's largest producer, Hong Hai's profits may be at increased risk due to declining economies of scale in the iPhone business and the steady shift of production capacity to India.
– Steven Tseng, Analyst
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Investors are keeping a close eye on Apple's performance in China, a huge market and home to the world's iPhone production base.
This quarter, Apple expects revenue to grow at a low-single-digit rate. The company predicted double-digit growth for both its iPad and services businesses, but did not provide guidance for the iPhone.
–With assistance from Betty Hou.
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