Foxconn Rides Boost in Work-From-Home Demands to Post Soaring Profit

Taiwan’s Foxconn, which assembles iPhones for Apple, reported first-quarter profit soared past estimates amid the work-from-home boom spurred by the COVID-19 pandemic that has stoked demand for devices like smartphones and laptops.

The world’s biggest contract electronics maker also said it sees growth continuing in the second quarter, expecting revenue for consumer electronics and computing products to both rises more than 15 percent on the year, extending first-quarter sales growth.

Officially known as Hon Hai Precision Industry Co, the firm’s January-March net profit rocketed to T$28.2 billion ($1 billion) from T$2.1 billion a year earlier, when the company’s business was badly hit by the early outbreak of the COVID-19 pandemic. The result, a 13-fold jump, was well above an average forecast of T$24.41 billion compiled from 11 analysts’ estimates by Refinitiv.

Foxconn said sales from its major revenue contributor – consumer electronics including smartphones and wearable devices – climbed more than 15 percent in the first quarter from a year earlier, while computing products such as laptops also rose more than 15 percent.

First-quarter revenue rose 45 percent from a year earlier to T$1.34 trillion, the company said. The company had previously expected first-quarter revenue to be “better than normal” for the season thanks to strong sales of smartphones and telecommuting devices

Foxconn, however, has said it was closely monitoring “materials shortages” in the consumer electronics supply chain, amid a crunch in semiconductor supplies that has hit the auto industry, though described the impact as “limited”

It assembles iPhones at plants in China and India, the latter now ravaged by the spread of the coronavirus

Foxconn’s shares have risen 14 percent this year. They ended up 1.5 percent on Friday, compared with a 1 percent rise for the broader market.($1 = 27.9500 Taiwan dollars)

© Thomson Reuters 2021