Foxconn Posts Better-than-expected Second-quarter Profit
Foxconn, the contract electronics manufacturer, reported a better-than-expected quarterly profit on Wednesday, as rising telecommuting demand amid the coronavirus pandemic offset slowing smartphone sales.
Foxconn, whose clients include tech giants such as Apple, reported a net profit of T$22.9 billion ($778.54 million) for the second quarter ended June.
That was up about 34% from a year earlier according to Reuters calculations and better than a consensus estimate of T$17.95 billion drawn from 13 analysts polled by Refinitiv.
The firm, formally called Hon Hai Precision Industry Co Ltd, had in May warned of bleak smartphone sales in the second quarter citing an “enormous” impact on demand due to the virus, but said the work-from-home lifestyles being adopted worldwide would offer new growth opportunities.
Analysts, however, expect Apple’s new lineup of iPhones, set to be launched in the autumn, to boost Taipei-based Foxconn’s revenue recovery in the months to come.
More than 70% of the new iPhones could be assembled by Foxconn, helping the firm’s revenue resume growth in the fourth quarter, Taipei-based KGI Securities said.
Shares in the company closed 2% higher ahead of the results, versus a 0.9% fall for the broader market. Foxconn shares have lost more than 10% this year.
Neha writes articles on sectors including medicine, food, materials, and science & technology. A qualified statistician, she has the ability to observe and analyze the trends in global markets and write compelling articles that help CXOs in decision making. She is a bookworm and loves to read fiction, lifestyle, science and technology. Neha comes with 6 years of experience in content writing and editing that involves blog writing, preparation of study materials and OERs.