Foxconn Chairman Liu Young-way told the company's annual
shareholders meeting the firm remained cautious about this year due to monetary
policy tightening, geopolitical tensions and uncertainty over inflation, but
servers were a bright spot due to surging interest in AI.
"More and more people are using ChatGPT," he said.
"You can see the market for AI servers will rise much faster than
expected. We expect that in the second half of this year there may be a three
digit increase."
The Taiwanese company has a 40 percent global market share
for servers and aims to further increase that, Liu added.
In the first quarter, Foxconn's cloud and network products
segment, which includes servers, accounted for 22 percent of revenue, second
only to smart consumer electronics —which includes smartphones — at 56 percent.
Foxconn this month posted a 56 percent plunge in
first-quarter net profit, lagging forecasts in its biggest quarterly fall in
three years, and said visibility for the full year was "limited".
The company, the world's largest contract electronics maker,
wants to replicate the success it has had with Apple's iPhone with electric
vehicles (EV).
Foxconn, formally called Hon Hai Precision Industry, has
acquired the former General Motor plant in Lordstown, Ohio, and has also hired
a former Nissan executive, Jun Seki, to lead expansion efforts in EVs, where it
hopes to become a major manufacturer.
The company is considering expanding its EV battery supply
chain beyond Taiwan, possibly into the United States, Indonesia and India, Liu
said.
Foxconn, which assembles around 70 percent of iPhones, has
been diversifying production away from China, whose strict COVID-19
restrictions disrupted its biggest iPhone plant last year. The company is also
seeking to avoid a potential hit to its business from mounting trade tensions
between Beijing and Washington.
Liu said China, including its massive iPhone plant in
China's Zhengzhou, remained very important for Foxconn.
"The culture there is very similar, our rules and
regulations are a bit different, but there is no problem when it comes to
talent. So it's relatively easier for us to start new undertakings there. We'll
work hard to keep developing there." © Reuters
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