Hon Hai reports highest ever sales for August

Taipei, Sept. 6 (CNA) Taiwan-based manufacturing giant Hon Hai Precision Industry Co. on Thursday reported its highest ever sales in August, soaring more than 32 percent from a year earlier, as the company's revenue growth momentum accelerated at a time of a booming artificial intelligence demand.

In a statement, iPhone assembler Hon Hai, also known as Foxconn globally, said it posted NT$548.31 billion (US$17.16 billion) in consolidated sales in August, up 32.81 percent from a year earlier. However, the August figure was down 4.2 percent from a month earlier, the company said.

Hon Hai said its four major divisions -- cloud and networking products, smart consumer electronics, computing devices and electronic components -- recorded strong year-on-year growth in August.

The cloud and networking division benefited from solid global demand for AI-related products, while the computing division saw clients rebuild inventories for the debut of their new products, and the smart consumer electronics division rode the wave of client stockpiling, Hon Hai said.

In addition, the electronic components division received a boost from an increase in key component shipments and automotive part demand, Hon Hai added.

However, the cloud and networking division, computing division and electronic components division saw sales little changed from a month earlier in August, while the smart consumer electronics division reported a slight decline in revenue from July as major products entered a transitional period ahead of the introduction of the next generation of items.

Market analysts said the fall in sales in the smart consumer electronics division came as many consumers are waiting for the debut of next generation iPhones, scheduled to be unveiled later in September.

In the first eight months of this year, Hon Hai's consolidated sales totaled NT$3.99 trillion, up 9.52 percent from a year earlier, the company said.

Hon Hai said the cloud and networking division reported higher sales in the eight month period due to strong demand for AI servers, and the electronic components division was largely boosted by solid demand for automotive parts.

The introduction of new products by international brands paved the way for sales growth in the computing division in the eight month period, while the smart consumer electronics division reported a fall in sales on a relatively high comparison base over the same period last year, when its Zhengzhou compound in China's Henan province benefited from deferred orders due to the effects of the COVID-19 pandemic.

Looking ahead, Hon Hai said, its business entered peak season in the second half of this year and it expects sales for the third quarter to grow from the previous quarter and from a year earlier.

Hon Hai has forecast AI server sales will grow more than 40 percent from a year earlier in 2024.

Meanwhile, Largan Precision Co., a supplier of smartphone camera lenses to Apple Inc., reported a new monthly high of NT$7.02 billion in consolidated sales in August, up 54.25 percent from a year earlier and also up 29 percent from a month earlier.

Analysts said the strong showing reflects an increase in orders from Apple for production of the newest iPhone.

However, Largan said sales growth momentum is expected to weaken in September reflecting cyclical factors different from the past.

In August, Largan's 20 mega-pixel lenses and higher -- which have a higher profit margin -- accounted for 10-20 percent of its total sales, with 10-20 mega-pixel lenses making up 60-70 percent, 8 mega-pixel lenses representing less than 10 percent, and other mega-pixel lenses making up 20-30 percent, the company said.

In the first eight months of this year, Largan's consolidated sales totaled NT$34.74 billion, up 36.85 percent from a year earlier, the company added.