Taiwan’s Foxconn reports 35 percent rise in profit on AI demand

The world’s largest contract electronics maker said on Wednesday that net income rose 35 percent to $59.97 billion New Taiwan dollars ($1.86bn) in the April-June period.

The result beat estimates of $58.38 billion New Taiwan dollars in a Bloomberg survey of analysts.

“AI infrastructure is driving growth,” Foxconn said in its earnings announcement.

In an earnings release, Foxconn, Nvidia’s biggest server maker and Apple’s top iPhone assembler, stuck to its previous forecast of “strong” growth for revenue this year.

Governments and tech giants are pouring huge sums into building data centres that can train and run AI tools such as chatbots, image generators and agents that can execute tasks.

This has turbocharged business for Foxconn, which makes the servers used in the data centres.

Foxconn, formally called Hon Hai Precision Industry, in July reported a 40 percent year-on-year jump in second-quarter revenue.

Most of the iPhones Foxconn makes for Apple are assembled in China, but it now produces the bulk of those sold in the United States in India.

The company is also building factories in Mexico and Texas to make AI servers for Nvidia.

Foxconn has also been looking to expand its footprint in electric vehicles.

The company’s shares have risen 17 percent so far this year, underperforming the broader Taiwan index’s 57-percent gain.

Foxconn shares closed 2.7 percent higher on Wednesday ahead of the earnings release.