Foxconn profit plunges 40%
Taiwanese technology company Foxconn said its third-quarter profit had dropped by more than a third, dragged down by costs associated with producing the latest iPhone model.
Taiwanese technology company Foxconn says its third-quarter profit dropped by more than a third, dragged by costs associated with producing the latest iPhone model.
Also known as Hon Hai, the firm is the world’s largest contract electronics maker and assembles Apple’s iPhones.
Its net income in July-September fell 39.3% from a year earlier to 21-billion new Taiwanese dollars ($696m), lower than the 37.2-billion new Taiwanese-dollar estimate compiled by Bloomberg.
Revenue in the third quarter only rose a marginal 0.33% to 1.08-trillion new Taiwanese dollars, Hon Hai said on Tuesday.
Analysts say the quarter’s profit took a hit due to the costs of producing the iPhone X, Apple’s most expensive device.
The new gadget — which marks the 10th anniversary of the first iPhone release — went on sale earlier in November. Hon Hai’s fourth-quarter results should improve on sales of the iPhone X, which appears to be strong so far, analysts say.
The firm’s billionaire founder, Terry Gou, has been snapping up investments in a bid to diversify from simply being an assembler of electronics. It acquired electronics firm Sharp in 2016 to gain its cutting-edge liquid-crystal display technology despite having to absorb the Japanese firm’s huge debts.
In July 2017, Foxconn announced a $10bn investment to build a plant in Wisconsin, a move praised by US President Donald Trump. Gou said then the firm would continue to invest in other US states.
He tried to bid for Toshiba’s memory chip unit but was rebuffed when the Japanese firm said in September it had signed a deal to sell to a consortium.