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Hon Hai reports 1.76 percent drop in June sales

2012/07/11 17:07:51

Taipei, July 11 (CNA) Hon Hai Precision Industry Co., the world's largest contract electronics maker, reported Tuesday a 1.76 percent monthly decline in non-consolidated sales for June, in reflection of the slow-season effects of the second quarter on the global high tech sector.

Hon Hai said it recorded NT$236.83 billion (US$7.92 billion) in non-consolidated sales for June, down from NT$241.09 billion in May but up 3.69 percent from a year earlier.

In the second quarter, Hon Hai's non-consolidated sales fell 7.63 percent from the first quarter to NT$729.65 billion, but the secondquarter figure was the third highest in the company's history.

In the first six months of this year, the company's non-consolidated sales rose 27.92 percent from a year earlier to NT$1.52 trillion.

The decline in Hon Hai's non-consolidated sales in June was the third consecutive monthly drop this year. The company’s revenue for March was the highest so far this year.

Analysts said the falling sales reflected the effects of the slow-season in the second quarter on the global high tech sector. Strong demand for communications devices in June was offset by the weakness of the market for global personal computers and consumer electronics, they said.

Furthermore, global demand for electronics devices, in particular in Europe and the United States, has been hurt by the lingering debt problems in the eurozone, while buying in China has also been compromised amid the economic slowdown, they said.

In addition, Apple Inc., one of Hon Hai's largest sales sources, has been in a transition period, which has resulted in many potential buyers holding back and waiting for the launch of iPhone 5, analysts said.

Apple is expected to unveil its new smartphone model in September or October, which means Hon Hai’s sales are likely to pick up in the second half of this year, analysts said.

Later this year, Apple is also expected to launch a smaller tablet computer that the market has dubbed iPad mini, which is expected to boost buying interest, they said.

(By Jalem Chung and Frances Huang)
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