Despite severe semiconductor shortages, supply chain issues and reduced demand for consumer and industrial electronics, Apple supplier Foxconn Technology Group managed a 5% rise in first-quarter profits.
The Taiwanese company, the world’s largest contract electronics maker, reported a 4% rise in first-quarter revenue and said it expected revenue for both the second quarter and the full year to be flat.
Demand for consumer electronics including smartphones – its key growth driver – has stalled due to coronavirus lockdowns in China and travel and other restrictions elsewhere.
Net profit for the January-March quarter rose to NT$29.45 billion ($985.48 million), compared with an average analyst estimate of NT$29.76 billion, according to Refinitiv.
Foxconn, like other global manufacturers, has grappled with a severe shortage of chips that has squeezed smartphone production, and more recently with a downturn in major markets amid high inflation and the war in Ukraine.
While the company, formally called Hon Hai Precision Industry, has previously said that Covid-19 controls in China have only had a limited impact on its production, demand for its products in the country has suffered as people remain shut in.
Foxconn shares closed 1% lower ahead of the earnings release, versus a 2.4% drop in the broader market. They have fallen about 2% so far this year, giving the company a market value of $48.1 billion.
- Reuters, with additional editing by George Russell