Foxconn Maintains Strong Earnings Growth on Resilient AI, Tech Hardware Demand
By Sherry Qin
Foxconn Technology Group continued its strong earnings momentum in the third quarter, driven by robust demand for its artificial-intelligence servers and other tech hardware as the data-center boom is facing growing headwinds.
Once mainly known as an assembler of Apple's devices, the world's largest contract electronics maker now derives a meaningful share of revenue from building AI servers for industry leaders such as Nvidia.
The Taiwanese company, formally known as Hon Hai Precision Industry, said net profit climbed 34% from a year earlier to 77.52 billion New Taiwan dollars, equivalent to US$2.36 billion. That beat the NT$69.35 billion expected by analysts in a FactSet poll.
Revenue rose 46% to NT$3.016 trillion as sales of cloud and networking products, including AI servers, continued to drive top-line growth, accounting for 54%. The smart consumer-electronics segment encompassing smartphones contributed 29%.
The company expects its AI server-rack shipments to post high double-digit growth sequentially in the fourth quarter as it expands its server customer base and manufacturing footprint across the world.
Despite the earnings strength, Foxconn's stock performance paints a less rosy picture. After rising by about a third in the second quarter, shares were roughly flat in July to September as investors weighed continued strong demand for AI hardware against growing concerns about Big Tech's aggressive investment spending.
Foxconn, however, has repeatedly signaled confidence. The company has forecast AI rack shipments to more than double this year and now aims to further grow its market share in 2027 with diverse AI solutions and a widening customer base.
A potential headwind could come from Democrats' sweep of the U.S. midterm elections, which has raised concerns about tighter AI regulation and a possible slowdown in data-center expansion.
Morgan Stanley said it remains constructive on AI infrastructure demand in the long term but warned that delays in U.S. data-center construction could create a temporary air pocket across the AI supply chain in 2028, a potential risk factor for hardware suppliers such as Foxconn.
Write to Sherry Qin at sherry.qin@wsj.com
(END) Dow Jones Newswires
November 12, 2026 02:05 ET (07:05 GMT)
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