Taiwan’s Foxconn, which assembles iPhones for Apple, reported better-than-expected third-quarter profit on Friday, helped by strong smartphone demand as people continue to work remotely through the coronavirus pandemic .
But Foxconn, the world’s largest contract electronics maker, said it expects fourth-quarter revenue in its key consumer electronics business, which includes smartphones, to drop more than 15 percent from a year ago, without giving any reason. It has projected a decline of between 3 per cent and 15 per cent in total revenue.
Foxconn previously said it felt only a small impact from the year-long global chip shortage, but cautioned that rising COVID-19 cases in Asia could damage its supply chain.
Third quarter revenue jumped 9 per cent, Foxconn said, with net profit up 20 per cent to Rs 36.98 billion (about Rs 10,668 crore) in its July-September report from a year ago. This was above the Refinitiv consensus estimate of TWD 31.73 billion (about Rs 8,492 crore).
Analysts had said they expected strong iPhone sales in the third quarter to fuel Foxconn’s business, and that the company has secured more than 75 percent of assembly orders, including for the latest iPhone 13. But he cautioned that supply chain problems could be moot in any near term. Foxconn orders hike
Apple said last month that the supply chain crisis cost the company $6 billion (about Rs 44,673 crore) in sales during the July-September quarter, and that the impact would worsen during the year-end holiday period.
“In the short term, Hon Hai’s iPhone 13 shipments will continue to be affected by chipset shortages, something that even Tim Cook confirmed” on the Apple earnings call, Fuban Research wrote in a November 8 note.
© Thomson Reuters 2021