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Foxconn Technology ( OTCPK:FXCOF ) expects “significant” growth in 2024 driven by demand for AI servers, after fourth-quarter results beat estimates.
Supplier Apple (AAPL), formally known as Hon Hai Precision (OTCPK:HNHAF) (OTCPK:HNHPF) — She said net profit grew 33% year-on-year to NT$53.15 billion (about $1.69 billion). According to relationship from Bloomberg News.
Fourth-quarter revenue fell 6% year-on-year to NT$1.852 trillion.
The outlook for 2024 has become more positive since Hon Hai President and CEO Young Liu said in November 2023 that their view on this year’s outlook was neutral.
The company said that due to the rise of generative AI applications, visibility into AI servers has become very high, prompting them to revise their outlook upwards towards “significant” growth from the original neutral view.
For the AI server segment, Liu noted that the annual growth of GPU modules will be more than doubled this year, while revenue from the AI server business is expected to exceed 40% year-on-year and account for more than 40%. of the total server business.
In terms of AI applications, Liu said that in addition to CSP [communications service providers] customers, the brand’s customers also began to actively develop AI servers. These are the company’s existing customers, so their AI development, along with the stabilization of general servers, will benefit the group’s performance.
However, Foxconn expects inventory digestion in networking products to have a slight impact on growth momentum in the first half of 2024. But, looking at the entire cloud and networking product segment this year, the company believes that a strong growth is still achievable.
For the first quarter of 2024, the company expects revenue to decline year over year, Foxconn said earlier in the month.
For the full year 2023, revenue decreased 7% year-on-year to NT$6.162 trillion, however, net profit increased 0.4% to NT$142.1 billion for the same period.