Apple Asks Foxconn to Build AI Servers in Taiwan

According to a report from Nikkei Asia, Apple has approached Hon Hai Precision Industry Co., also known internationally as Foxconn, about manufacturing artificial intelligence (AI) capable servers in Taiwan.

Apple’s request for AI servers is part of its broader strategy to enhance its AI capabilities. These servers will primarily be used internally to support Apple’s expanding AI infrastructure.

Unlike consumer products such as iPhones and iPads, this hardware is meant to handle the heavy computational demands required for Apple’s generative AI initiatives. As such, the size of the order is expected to be relatively small compared to Apple’s traditional hardware requests.

While Foxconn is Apple’s largest iPhone supplier and a natural choice for this new venture, the company faces limitations in taking on Apple as a server customer. Foxconn is already the leading manufacturer of AI servers for Nvidia, a major player in the AI space, which could constrain its ability to meet Apple’s needs.

Given the complexity and capacity demands of manufacturing AI servers, Apple is also exploring other options. According to the report, Apple has approached Lenovo Group to help with the design and production of these AI servers.

In addition to Lenovo, Apple has also reached out to smaller suppliers, such as Universal Scientific Industrial Co., to potentially join its AI server production plan.

This also indicates that Apple is diversifying its supply chain to ensure it has enough production capacity to support its AI ambitions.

The company’s push for internal servers aligns with its goal of staying competitive in the rapidly evolving AI landscape, where companies like Google and Microsoft are also investing in similar technologies.