Hon Hai Reports Highest-Ever June Sales

Hon Hai Precision Industry Co., the world’s largest contract electronics maker, reported its highest-ever sales for June for the company, with market analysts attributing the growth to solid demand for communication and computing devices.

In June, Hon Hai, an iPhone assembler, posted NT$396.54 billion (US$12.75 billion) in consolidated sales, up 1.71 percent from a year earlier, representing the firm’s highest revenue for June. The June sales rose 3.2 percent from a month earlier, according to data compiled by Hon Hai.

In the second quarter of this year, Hon Hai’s consolidated sales rose 10.07 percent from the first quarter to NT$1.16 trillion, which was the highest-ever April-June period level for the company, the data shows.

In the first six months of this year, Hon Hai, known as Foxconn in the global market, recorded NT$2.22 trillion in consolidated sales, up 5.14 percent from a year earlier, the data indicates.

Looking ahead, analysts said Hon Hai has started to raise production for the third quarter in preparation for the peak season in the second half of this year, in particular for the year-end shopping spree among global consumers.

Apple Inc., one of Hon Hai’s major clients, could introduce new smartphone models in September — a 6.5-inch iPhone equipped with an organic light-emitting diode (OLED) screen, a 5.8-inch OLED iPhone and a 6.1 inch iPhone sporting an LCD screen, analysts said, adding that the new devices are expected to spark buying, which will boost Hon Hai’s shipments in the second half of this year.

According to international media, Apple is considering the possibility of moving between 15 percent and 30 percent of its suppliers’ hardware production out of China in a bid to cushion any possible impact from the Washington-Beijing trade dispute, and Hon Hai could be one of Apple’s suppliers in the U.S. consumer electronics giant’s plan.

According to market estimates, Apple accounts for more than 40 percent of Hon Hai’s sales each year.

In response, Liu Young-way (劉揚偉), the new chairman of Hon Hai, has said his group has manufacturing sites in 16 countries worldwide and its production capacity outside China is expected to meet demand from the U.S. market.

Liu said that if Apple demands that its suppliers shift some of their production out of China, Hon Hai will still be able to meet the needs from its clients on the back of its broader global production bases.

However, he noted that Hon Hai is still watching closely how the trade friction between the U.S. and China will evolve before making its next move.

Hon Hai said the company will continue to roll out products in China, as its Chinese plants are still operating normally, despite the global trade issue.

Earlier this week, a board meeting of Hon Hai approved a proposal to appoint Liu as president of the company.

Liu was elected chairman June 21 to succeed Terry Gou (郭台銘), who stepped down after he announced in mid-April his plan to change his career plan by jumping into politics by joining the opposition Kuomintang’s primary for the 2020 presidential election.

Liu’s chairmanship began July 1, with Lee Chieh (李傑) taking the helm as vice chairman.

The new chairman has been in charge of Hon Hai’s semiconductor development initiatives, which the company has dubbed its “S sub-business group.”―Focus Taiwan

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