TAIPEI: Hon Hai Precision Industry Co posted a quarterly profit that topped projections, thanks to solid demand for Apple Inc.’s flagship iPhone X.
The world’s largest electronics contract manufacturer reported net income of NT$71.7 billion ($2.5 billion, Dh9.2 billion) in the three months ended December, based on calculations off previously reported earnings. That exceeded the NT$58 billion projected, on all-time high revenue of NT$1.73 trillion.
Hon Hai, part of billionaire Terry Gou’s Foxconn Technology Group, is the sole maker of Apple’s priciest gadget and benefitted from robust sales of the iPhone X, despite initial worries that it fell flat with consumers. Hon Hai’s outperformance suggests it’s moved past initial hiccups in the device’s production, when it grappled with parts shortages. Last month, Apple Chief Executive Officer Tim Cook said on an earnings call that the iPhone X was the best-selling smartphone over the holidays, citing research firm Canalys.
Hon Hai gets more than half its revenue from Apple but Gou’s looking for ways to expand beyond merely assembling gadgets — especially as the smartphone market sputters. He’s now taking Foxconn Industrial Internet Co, a subsidiary focused on cloud services and smart manufacturing, public in China. Arthur Liao of Taipei-based Fubon Securities estimates that FII’s market value could hit 269 billion yuan ($43 billion) compared with Hon Hai’s $56 billion in a March 13 note.
Hon Hai doesn’t provide revenue breakdowns, forecasts or hold investor conferences. Its shares rose 1.6 per cent ahead of the earnings but are down 4 per cent this year.
