Net Profit Forecast
Foxconn Technology Group is expected to report a 22% drop in net profit for the second quarter of this year. Analysts predict a net profit of 25.82 billion new Taiwan dollars, compared to 33.29 billion in the same period last year.
Revenue Forecast
Foxconn announced that its second-quarter revenue fell 14% from the previous year to NT$1.303 trillion. These figures are unaudited.
Key Points to Watch
Margins
The company’s operating profit margin showed improvement, reaching 2.77% in the first quarter, up from 2.25% in the fourth quarter of 2022 and 2.61% in the same period last year. Margin trends are being closely monitored by investors worldwide, given the rising operating costs across industries.
Outlook
July’s revenue declined by 1.2% compared to the same month last year, with sales of cloud and networking products dropping and slower demand in the personal-computer market. However, Foxconn expects a better outlook for the third quarter compared to the second. Investors will be interested in any earnings projections provided by management.
Chip Initiatives
Foxconn recently terminated a chip-making partnership with Indian resources conglomerate Vedanta and is actively seeking new partners. Additionally, the company joined forces with auto maker Stellantis earlier this year to establish a new business selling semiconductors to the automotive industry. Any updates on Foxconn’s chip initiatives will be of particular interest to investors.
