Hon Hai's February sales down on seasonal factors

Taipei, March 6 (CNA) Hon Hai Precision Industry Co., the world's largest contract electronics maker, reported on Tuesday a more than 12 percent year-on-year decline in sales for February, extending a sales downturn seen in January.

In a statement, the iPhone assembler, also known as Foxconn internationally, said it posted consolidated sales of NT$352.48 billion (US$11.15 billion) in February, down 12.33 percent from a year earlier.

The February sales were also down 32.49 percent from a month earlier, in part because of fewer working days in February than January due to the presence of the seven-day Lunar New Year holiday, Hon Hai said.

In the first two months of the year, which offsets the year-to-year impact of the Lunar New Year holiday, Hon Hai had consolidated sales of NT$874.62 billion, down 17.67 percent from the same period in 2023.

During the two-month period, revenue in the electronics component and cloud and networking divisions rose year-over-year but the sales of the computing products and smart consumer electronics divisions fell, the company said.

The cloud and networking division benefited in particular from the growing demand for servers, and that should continue in the coming months, said Hon Hai spokesman James Wu (巫俊毅) in February.

He said that given the growth of AI applications expected in 2024 and 2025 and the more than 40 percent share of the global AI server market already held by Hon Hai and other companies under its corporate umbrella, AI-related products such as servers should continue to spur sales growth.

Hon Hai said it expected sales for the first quarter to fall year-over-year due to a relatively high base of comparison from the first quarter of 2023, when production at its plant in Zhengzhou in Henan province resumed after a strict COVID-19 lockdown.

The Zhengzhou complex rolls out iPhones for Apple Inc.

Hon Hai has scheduled an investor conference for March 14 and the company is expected to disclose information about shipments of AI servers and other key electronics components.

It is also expected to talk about orders placed by Apple for iPhone assembly as well as the progress it has made in developing electric vehicles.