Taipei, Aug. 14 (CNA) — Hon Hai Precision Industry Co. , the world’s largest contract electronics manufacturer, projects that sales from artificial intelligence (AI) servers will surge over 170 percent year-on-year in Q3 2024. The company reaffirmed its forecast that AI server revenue will exceed NT$1 trillion (US$33. 35 billion) in 2025. At an investor conference, rotating CEO Kathy Yang (楊秋瑾) announced that the Q3 AI server sales growth is expected to surpass the 60-percent year-on-year increase recorded in Q2, fueling overall sales growth into 2025. Specifically, sales of server racks are anticipated to grow by 300 percent compared to the same period last year. Yang emphasized that AI server sales momentum will continue into 2026, supporting long-term expansion. Currently, AI servers account for over 50 percent of Hon Hai’s total server sales. Before the conference, Hon Hai (also known globally as Foxconn) reported record net profit of NT$44. 36 billion and consolidated sales of NT$1. 79 trillion for Q2 (April to June). The company’s cloud and networking division, driven by robust AI server demand, contributed 41 percent of total Q2 sales—up from 34 percent in Q1—surpassing the smart consumer electronics division’s 35 percent share for the first time. Yang highlighted that shipments of Hon Hai-made AI servers to the U. S. will remain strong in H2 2024, with expanded production capacity underway at 12 U. S. sites. The company plans to increase AI server manufacturing and liquid cooling capabilities in Texas and Wisconsin, while boosting cloud, networking, and server capacity in Ohio.

Addressing U. S. tariff-related uncertainties, Yang noted Hon Hai’s global footprint with 233 plants and offices in 24 countries enables flexible production and logistics adjustments to mitigate tariff impacts. CFO David Huang (黃德才) explained that every NT$1 appreciation of the Taiwan dollar against the U. S. dollar typically reduces Hon Hai’s sales by about 3 percent. Should the Taiwan dollar average NT$29 to the U. S. dollar in Q3—a 10 percent rise year-on-year—the company could face significant pressure. However, with the currency stabilizing after a Q2 surge, Hon Hai plans to leverage economies of scale, procurement optimization, and automation to manage costs and currency fluctuations. Capital expenditure climbed over 25 percent year-on-year to NT$79. 8 billion in H1 2024, reflecting production expansion, with anticipated capex growth exceeding 20 percent in 2025. Spokesman James Wu (巫俊毅) revealed Hon Hai’s collaboration with American AI chipmaker Nvidia Corp. on humanoid robot development. The next-generation humanoid robots and applications will debut at Hon Hai’s Tech Day event scheduled for November 21-22. In the electric vehicle sector, Wu cited EV Chief Strategy Officer June Seki’s statement that Hon Hai will assist Japanese partners in developing the Model A sedan and electric buses. In semiconductors, Hon Hai has signed a memorandum of understanding with France-based Thales and Radiall to form a strategic partnership and joint venture focused on advanced IC assembly and testing technologies, according to Yang.