Caption: A man walks past a Foxconn signage and robots on display during the Hon Hai Tech day in Taipei on November 21, 2025.

Summary

• Profit Surge: Taiwanese tech giant Foxconn reported a 24 percent jump in annual net profit for 2025, reaching $5.9 billion, fueled by massive global demand for artificial intelligence hardware.
• Optimistic Outlook: Despite concerns over Middle East conflicts and rising energy costs, Foxconn’s chairman forecast ‘robust growth’ and high double-digit quarter-on-quarter growth for AI rack shipments in early 2026.
• Strategic Pivot: The company is successfully diversifying beyond assembling Apple iPhones; its cloud and networking services portfolio grew to 40 percent of its business, reflecting its goal to become the ‘most trusted industrial platform of the AI era.’

 

TAIPEI, TAIWAN – Taiwanese tech giant Foxconn on Monday said it expects the booming market for artificial intelligence (AI) servers to drive growth this year, despite volatility caused by global conflict.

Strong demand for AI hardware fuelled a 24 percent annual net profit jump last year for Foxconn, the world’s largest contract electronics manufacturer.

Energy markets have been roiled by the war in the Middle East, raising concerns for big tech manufacturers, but company chairman Young Liu struck an upbeat tone during an earnings call with analysts.

“Over the past few months, there have been significant changes in tariffs, geopolitics, and global monetary policy,” Liu said. “However, driven by the strong growth of AI servers, I believe 2026 will still be a very good year, and we expect to see robust growth.”

Foxconn—also known by its official name, Hon Hai Precision Industry—has expanded beyond assembling low-margin Apple iPhones to manufacturing AI servers for companies like Nvidia, along with electric vehicles and robotics.

It is a move that is paying off as tech firms worldwide race to spend big on training and deploying rapidly evolving AI systems.

In 2025, Foxconn’s net profit came to NT$189.4 billion (~$5.9 billion), up from NT$152.7 billion in 2024. Revenue jumped 18 percent year-on-year to NT$8.1 trillion, the firm said, narrowly beating the estimates of a Bloomberg survey of economists.

AI Ambitions

Sky-high tech share results and valuations worldwide have led to concerns of an AI market bubble that could eventually burst. However, Foxconn on Monday forecast “strong AI server demand,” with “high double-digit quarter-on-quarter growth” expected for AI rack shipments in the first quarter of 2026.

Liu stated that the company aims to become “the most trusted industrial platform of the AI era.”

Reflecting this shift, cloud and networking services accounted for 40 percent of Foxconn’s business portfolio in 2025, up from 30 percent in 2024. Meanwhile, smart consumer electronics declined from 46 percent to 38 percent.

Huge global demand for memory chips used in AI data centres has caused a shortage that is threatening to drive up prices for everyday gadgets.

“Everyone is concerned about memory shortages and related price hikes for smart consumer products,” Liu said on Monday. But, he added, “since our product portfolio is mainly composed of higher-priced models, the impact we’ve observed so far has been relatively limited,” and demand has remained stable.

Ahead of Monday’s earnings release, Bloomberg Intelligence analyst Steven Tseng told AFP that for Foxconn, “so far the impact from the Middle East conflict appears largely manageable.”

“As the region is not a major market for either AI hardware or smartphones, the main risk is more on costs than demand, driven by higher oil prices and some logistic disruptions,” Tseng said. (AFP)