Foxconn reports strong Q2 profit, sees AI demand driving further growth
Foxconn posted a 27% year-on-year jump in second-quarter profit, surpassing market expectations, driven by surging demand for artificial intelligence (AI) servers. The company expects third-quarter revenue to rise, with AI server revenue projected to increase over 170% compared with last year, although it cautioned that tariffs and currency fluctuations remain a risk.
For the first time, Foxconn’s cloud and networking business, which includes AI servers, outpaced its smart consumer electronics segment, including iPhones, in Q2 revenue contribution. While smart device sales are expected to decline slightly in the current quarter, AI remains the primary growth driver, according to rotating CEO Kathy Yang, News.Az reports, citing Reuters.
To meet demand, Foxconn plans to increase capital spending by more than 20% this year, expanding server production capacity at facilities in Texas and Wisconsin. The company also continues to diversify manufacturing outside China, with Apple iPhones increasingly produced in India and AI servers being built in Mexico and Texas.
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