Hon Hai reports highest-ever Q1 net profit

Taipei, May 14 (CNA) Taiwan-based manufacturing giant Hon Hai Precision Industry Co. on Thursday reported its highest-ever net profit for the first quarter, up almost 20 percent from a year earlier, with analysts attributing the growth to a global AI boom.

In a statement, iPhone assembler Hon Hai, also known as Foxconn globally, said it posted NT$49.92 billion (US$1.58 billion) in net profit, up 19 percent from a year earlier and up 10 percent from a quarter earlier.

Hon Hai's first-quarter earnings per share stood at NT$3.56, up from NT$3.03 a year earlier and up from NT$3.23 in the fourth quarter of last year, Hon Hai said.

Hon Hai said its consolidated sales stood at NT$2.12 trillion in the first quarter, up 29 percent from a year earlier but down 19 percent from a quarter earlier.

The world's largest contract electronics maker said its gross margin --- the difference between revenue and cost of goods sold -- hit 6.18 percent in the first quarter, up 0.06 percentage points from a year earlier and up 0.3 percentage points from a quarter earlier.

Hon Hai said its operating margin -- the difference between sales and cost of goods sold and operating expenses -- stood at 3.57 percent in the first quarter, up 0.74 percentage points from a year earlier and up 0.29 percentage points from the previous quarter.

Hon Hai added its net margin -- the difference between gross profit and total expenses, including interest payments and taxes -- reached 2.36 percent in the first quarter, down 0.21 percentage points from a year earlier but up 0.62 percentage points from the previous quarter.

The first quarter results came in line with Hon Hai's expectations.

According to Hon Hai, its smart consumer electronics division accounted for 33 percent of its total sales in the first quarter, down from 39 percent in the fourth quarter, while its cloud and networking division made up 48 percent of the total revenue in the first quarter, up from 42 percent in the previous quarter, indicating strong AI demand.

Hon Hai said its computing division represented 14 percent of the total sales in the first quarter, up from 11 percent from the previous quarter, while the electronic component division accounted for 5 percent of the total revenue in the first quarter, down from 7 percent a quarter earlier.