Foxconn, the key supplier for Apple Inc, is forecasting a decline in first-quarter revenue due to quieter market demand. The first quarter is traditionally slower for tech companies like Foxconn, following the busy holiday season when they supply electronics to major vendors such as Apple for Western markets.
Despite the expected seasonal slowdown, this year’s first quarter is likely to see a year-on-year revenue drop, similar to the past three years. Foxconn did not provide specific numerical guidance, but noted that the first quarter of last year recorded a record high, boosted by the post-COVID resumption of normal factory operations.
In December, Foxconn’s revenue reached T$460.1 billion ($14.84 billion), a 26.9% decrease compared to the previous year, but still better than expected. The fourth quarter saw a 5.4% year-on-year decline in revenue to T$1.851 trillion, slightly above analysts’ estimates. The company attributed the “flattish” revenue in its smart consumer electronics segment, including smartphones, to reduced market demand.
Foxconn has been investing heavily in India as it looks to diversify risk exposure by shifting its base from China. This move allows the company to tap into India’s growing market and reduce its dependence on China for manufacturing.
Apple’s stock experienced a decline this week following analyst downgrades over concerns about iPhone demand. However, Apple remains the most valuable company globally by market value.
Foxconn plans to report its fourth-quarter earnings on March 14 and update its outlook. The decline in revenue for the first quarter is not unexpected, given the seasonal nature of the tech industry. It will be interesting to see how Foxconn’s investments in India and potential market shifts will impact its future performance.
