Foxconn projects Q1 revenue dip after slower Q4 demand

Foxconn revenue drop: Foxconn, a leading contract electronics manufacturer globally and the primary assembler for Apple's iPhones anticipates a decline in first-quarter revenue compared to the previous year. This projection follows subdued market demand that impacted the company's performance in the fourth quarter.

The first quarter typically witnesses a lull compared to the preceding quarter, a period marked by heightened activity as Taiwanese technology firms rush to meet the demand for smartphones, tablets, and other electronics from major clients like Apple for the year-end holidays in Western markets.

In a recent statement, Foxconn underlined that the revenue for the upcoming first quarter is likely to remain consistent with the subdued levels observed during the same period over the past three years. However, the company foresees a year-on-year contraction in revenue. Foxconn refrained from providing specific numerical guidance.

During the first quarter of the previous year, Foxconn achieved a record revenue for that particular period, attributed to the resumption of regular operations post the COVID-19 pandemic disruptions.

Q4 revenue dips 5.4 per cent

In December, the company reported revenue amounting to T$460.1 billion (equivalent to $14.84 billion), surpassing expectations despite marking a 26.9 per cent decline on a yearly basis. Meanwhile, the fourth-quarter revenue registered a 5.4 per cent decline year-on-year, settling at T$1.851 trillion. This figure exceeded the T$1.827 trillion LSEG SmartEstimate, which emphasises forecasts from consistently accurate analysts.

Foxconn noted that the revenue from its smart consumer electronics segment, encompassing smartphones, remained relatively stable year-on-year due to sluggish market demand.

Although Apple's stock experienced a decline this week following two analyst downgrades linked to apprehensions about iPhone demand, the tech giant continues to hold its position as the most valuable company globally by market capitalisation.

Foxconn is scheduled to announce its fourth-quarter earnings on March 14, concurrently updating its future projections. On Friday, Foxconn's shares concluded unchanged, contrasting with a marginal 0.2 per cent decline in the broader market.

(With Reuters inputs)