Foxconn posts a profit dip even as AI demand surges, with strong growth ahead, but shifting global risks could quietly influence what comes next.
Taiwan-based Foxconn, the world’s largest contract electronics manufacturer, expects strong revenue growth in both the first quarter and the full year, despite reporting weaker-than-expected quarterly profits.
The company posted a 2% decline in profit, mainly due to a higher tax rate. This drop came even as demand for AI products remained strong and fourth-quarter revenue jumped 22%.
A major supplier for Nvidia servers and the leading assembler of Apple’s iPhones, Foxconn gave its highest possible outlook, forecasting “strong growth” for both the upcoming quarter and the full year. However, it did not provide specific numerical estimates.
This also marks the first time Foxconn has issued a full-year outlook for 2026.
The company expects growth to be driven by continued strong demand for AI servers, aiming to reach around 40% market share.
Despite the positive outlook, Chairman Liu warned of external risks, particularly global political and economic uncertainties, including tensions in the Middle East, which could affect supply chains.
For the October to December quarter, Foxconn reported a net profit of T$45.21 billion ($1.42 billion), missing analyst expectations of T$63.86 billion.
Looking ahead, the company expects strong year-on-year growth in its smart consumer electronics segment during the first quarter, while forecasting a decline in the personal computer business.
Formerly called Hon Hai Precision Industry, Foxconn had earlier reported record fourth-quarter revenue, driven by strong demand for AI products.
While most iPhones are still assembled in China, a large portion of those sold in the United States are now produced in India. Foxconn is also expanding operations in Mexico and Texas to support Nvidia’s AI server production.
The company is also investing in electric vehicles, which it sees as a key growth area, although progress in this segment has been uneven.
So far this year, Foxconn’s shares have fallen 6%, underperforming Taiwan’s benchmark index, which has risen 15%. However, the stock gained 0.9% on Monday ahead of the earnings release.
