Hon Hai Precision Industry Co., known as Foxconn, reported a slowdown in sales growth in July, linked to ongoing U.S. tariffs. Nevertheless, the company continues investing in AI infrastructure.
Foxconn Sales Growth Eases
In July, Foxconn's sales increased by 7.25%, reaching NT $613.8 billion ($20.5 billion), marking the slowest monthly gain since January. This figure fell short of analysts' expectations for a 12.2% growth in the third quarter. Previously, Foxconn had projected both sequential and year-on-year sales growth for the July-to-September period.
Sale of Ohio Plant and New Directions
In a significant move, Foxconn announced the sale of its Ohio plant in Lordstown for $375 million, machinery included. The company confirmed it would continue to use the site for a range of products aligning with its long-term goals.
Market Prospects and Business Impact
Despite current challenges, Foxconn may find hopeful prospects. Major tech firms are increasing capital spending to stay competitive amidst the AI boom. Notably, Nvidia plans to invest up to $500 billion in AI infrastructure, collaborating with manufacturers including Foxconn.
Foxconn faces market challenges related to tariffs, yet it is advancing into new areas such as AI and modernization of its plants, potentially opening new opportunities in the future.
