Foxconn, the world’s largest contract electronics maker, reported a 20.2 percent rise in its third-quarter revenue, reaching T$1.85 trillion ($57.3 billion), driven by strong demand for artificial intelligence (AI) servers.
The Taiwanese company, known as Apple’s largest iPhone assembler, said the result surpassed its own expectations for growth.
The significant growth came from Foxconn’s cloud and networking products division, supported by robust AI server demand. Nvidia, a leading AI chip manufacturer, is one of Foxconn’s key customers in this area.
The size of the AI server market will become $187 billion in 2024, achieving growth rate of 69 percent, accounting for 65 percent of the total server market value, TrendForce said.
Server market spending is projected to reach $151 billion in 2024, Gartner said.
Revenue from AI semiconductors is expected to increase 33 percent to $71 billion in 2024, according to the latest forecast from Gartner.
In terms of AI chip suppliers for AI servers, NVIDIA holds the highest market share — approaching 90 percent for GPU-equipped AI servers — while AMD’s market share is only about 8 percent, TrendForce said.
While Foxconn saw strong quarter-on-quarter growth in its smart consumer electronics division, driven by new product launches like iPhones, the year-on-year performance in that segment remained flat.
The recent Canalys report said global smartphone market grew 12 percent to 288 million units during the second-quarter of 2024. Performance of global smartphone market for the third-quarter is yet to be revealed by analyst firms.
Canalys predicts that the smartphone shipments will be reaching 1.17 billion units in 2024. The growth in smartphone market will be driven by emerging telecom markets, where smartphones are essential for connectivity, entertainment, and productivity.
Traditionally, Taiwan’s tech firms see a surge in activity during the third quarter as they ramp up production to meet the year-end holiday demand in Western markets. Foxconn’s September revenue hit T$733 billion, marking a 10.9 percent increase year-on-year and its second-highest performance for the month.
Looking ahead, Foxconn expects its operations to gain momentum as it enters the peak season in the second half of the year. However, the company remains cautious, forecasting the fourth quarter to align with current market expectations without providing specific numbers.
Foxconn will release its full third-quarter earnings on November 14 and will hold its annual Tech Day event on October 8-9, where it is expected to announce new products and partnerships.
Baburajan Kizhakedath
