Apple supplier Foxconn ‘cautious’ about demand as inflations spreads
Taiwanese Apple supplier Foxconn is “cautious” about upcoming demand, supply chains and operating performance, it’s chairman said today, as inflation spreads and tensions with China rise.
Foxconn, also known as Hon Hai Technology Group, is one of the world’s biggest suppliers of semiconductors or computer chips.
The Taiwanese tech giant hit a record half-year revenue of NT$2.9 trillion (£79.9bn), it revealed today, up eight per cent in comparison with the first six months of last year.
“Against a backdrop of slowing demand and supply chain disruptions, the strong operating performance demonstrates the high degree of the Group’s resilience,” chairman Young Liu said in a statement. “It reflects a better product portfolio and customer structure.”
The geopolitical climate, inflationary pressure and the Covid-19 pandemic has weighed on Foxconn outlook, added Liu. However, the company has lifted its full-year outlook for performance from “roughly flat” to “growing”.
The New Taipei-based company has been working on entering the lithium battery market. Dubbed the ‘new oil’, lithium batteries – similar to computer chips – are in top demand amid the success of electric vehicles.
Bosses now expect production to kick off in 2024, having scheduled sample deliveries of its batteries for the third quarter of this year.
As Taiwan’s relationship with China grows increasingly militaristic, Foxconn has set up a research and development (R&D) centre Stateside, in Detroit, Michigan, in which “a number of experienced R&D personnel have already joined”, Liu said.
Taiwan’s national security officials are reportedly looking to persuade Foxconn to unwind an $800m (£661m) investment in Chinese chipmaker Tsinghua Unigroup.
The deal is not expected to be cleared, the Financial Times reported on Wednesday, citing a senior Taiwanese government official involved in national security issues.
City PM has contacted Foxconn and Tsinghua Unigroup for comment.