Hon Hai reports 2nd highest January sales on strong AI server demand

Taipei, Feb. 10 (CNA) Taiwan-based manufacturing giant Hon Hai Precision Industry Co. on Monday reported its second-highest sales for January as strong shipments of artificial intelligence servers offset slow season effects.

In a statement, iPhone assembler Hon Hai, known as Foxconn globally, said it generated NT$538.67 billion (US$16.40 billion) in consolidated sales in January, up 3.16 percent from a year earlier but down 17.74 percent from a month earlier.

The latest January revenue only trailed NT$660.40 billion recorded in January 2023, according to Hon Hai.

On a year-on-year basis, Hon Hai said its cloud and networking product division benefited from strong demand for AI servers in January, while its electronics component product division also saw an increase in shipments.

However, shipments from Hon Hai's computing division stayed little changed from a year earlier in January, while sales of its smart consumer electronics product division reported a drop in revenue due to the reduced number of working days in January due to the Lunar New Year holiday.

On a month-on-month basis, Hon Hai said its networking and cloud division also got a boost from strong AI server sales, while the electronics component and smart consumer electronics divisions saw shipments decline largely on the reduced number of working days.

Also in January, the computing product division was affected by a relatively high comparison basis over the previous month, Hon Hai added.

Looking into the first quarter, Hon hai said, sales momentum is expected to extend from the fourth quarter, when its consolidated sales hit a new high of NT$2.13 trillion, and report an increase in sales from a quarter earlier.

Even better, Hon Hai said, the fourth quarter sales are likely to beat the average of the previous five years and also top that of the corresponding quarter of 2023.

Meanwhile, Largan Precision Co., a supplier of smartphone camera lenses to Apple Inc., said earlier this month that it posted NT$4.95 billion in consolidated sales in January, down 12 percent from a month earlier but up 11 percent from a year earlier.

In January, Largan said its 20 mega-pixel and higher lenses -- which have higher profit margins -- accounted for 20-30 percent of total sales, with 10-20 mega-pixel lenses making up 60-70 percent, 8 mega-pixel lenses representing less than 10 percent, and other products making up 10-20 percent.

Largan said sales in February are likely to fall from January but revenue posted in the first two months of this year could still beat the same period of last year.