Foxconn Profits Rise 13% Helped by iPhone, iPad Sales
Foxconn, Apple’s biggest assembly partner, has posted a 13% increase in profits due to a rise in iPhone and iPad sales, the company announced today.
Hon Hai said its net profit for the 12 months ended Dec 31 rose to 106.70 billion new Taiwan dollars ($3.50 billion) from 94.76 billion new Taiwan dollars a year earlier. Its revenue rose to 3.95 trillion new Taiwan dollars from 3.91 trillion new Taiwan dollars in 2012.
The Taiwanese company, which employs more than 1 million workers across China, largely depends on Apple’s orders, as the iPhone maker drives about 40% of its revenue, the Wall Street Journal has learned.
Hon Hai’s results were underpinned by demand from Cupertino, Calif.-based Apple, which sold 51 million iPhones in its fiscal first quarter ended Dec. 28, 2013–up 7% from the same period the previous year, but still four million units short of analysts’ expectations.
The company, however, is looking for new ways to increase revenue: It has continued its foray into software development and telecommunication services by investing $30 million in its software development unit and also branched out into the retail market as it sold its mobile accessories under its own Coverbank brand.
Furthermore, it has announced plans to invest $15 million in a robot-manufacturing and sales unit in China. The company also seeks expansion in other markets. For example, it plans to invest $30 million in a new US plant, Foxconn announced earlier in January. It also has plans to invest $1 billion in Indonesia.
The partnership with Apple, meanwhile, remains strong, as Chinese sources revealed that the company is expected to receive an order of 90 million iPhone 6 devices. The same sources point to a 23% increase in Apple device sales, which means another great year for the Taiwanese company.