Foxconn’s Nvidia business is surging while its Apple business shrinks

Taiwan’s Hon Hai Technology Group, better known as Foxconn, said in its second-quarter earnings report that it expects its AI server revenue to more than double in the current quarter, thanks in part to hefty demand from partners like Nvidia. Meanwhile, it expects its consumer electronic business, which includes manufacturing Apple’s iPhones, to shrink.

Behold, the company’s 2025 outlook in slide form:

Back in March, Hon Hai Chairman Young Liu warned of an imminent changing of the guard, with server products poised to assume the top slot as a driver of sales. And in Q2, the company’s server products made up the largest portion of its revenue — 41% — for the first time, while consumer electronics declined to 35%.

Apple has seen sales of its iPhones lose steam, while companies that manufacture AI products can’t keep up with demand.

“Major cloud service providers are raising their spending, and governments around the world are rolling out sovereign AI projects. This shows overall AI demand still outstrips supplies,” Hon Hai rotating CEO Kathy Yang said on the earnings call. “Our group is aggressively expanding our capacity to meet the swiftly growing demand.”

Tariffs remain a concern for the company, which is expanding production in the US in hopes of being exempted.

Overall, Foxconn’s net income rose 27% last quarter, better than analysts expected, and revenue grew 16%, which was in line with expectations.