Apple parts supplier Foxconn has forecast strong demand for the new iPhone 12 in the final quarter of the year and over the Christmas period and stressed that it would continue investing in the US, as scheduled, and is looking at making new products there.
Foxconn, formally Hon Hai Precision Industry, reported near flat third-quarter profit, beating market estimates amid firm demand for telecommuting devices amid a coronavirus-induced work-from-home trend.
Chief financial officer David Huang said third-quarter revenue fell 7 per cent due to clients delaying product launches.
Still, chairman Liu Young-way said Foxconn saw “stronger than expected” demand for both smartphones and servers, with strong shipments of Apple’s new iPhone 12 supporting revenue.
Analysts and Mr Liu expect this trend to continue in the coming months. Foxconn is likely to assemble all premium models and 70 per cent of other models.
Foxconn expects consumer electronic product revenue to rise about 10 per cent in the fourth quarter, as well as next year.
Consumer electronics, including smartphones, made up 41 per cent of revenue in the third quarter, followed by devices for cloud computing at 28 per cent and other computing products such as laptops at 24 per cent.
Foxconn’s planned $10 billion (€8.5 billion) investment in the US state of Wisconsin did not create enough jobs in 2019 to earn tax credits, the state government said last month, the second year the company missed targets touted by President Donald Trump as a major economic win.
For many, the factory has become a symbol of failed promises in mid-western US states that were key to Mr Trump’s 2016 election but flipped to Democrat Joe Biden last week.
Foxconn said its investment plan did not depend on who the US president was. It was, however, exploring the option of building a new production line there, it said.
“We continue to push forward in Wisconsin as planned, but the product has to be in line with the market demand ... there could be a change in what product we make there,” Mr Liu said.
Possible new products include those related to servers, telecommunications and artificial intelligence, he said.
Foxconn initially sought to make advanced large-screen displays for TVs at the Wisconsin site. It later said it would build smaller liquid crystal display (LCD) screens instead.