As a result of a 5.4 percent drop in sales over the final three months of 2023, Hon Hai Precision Industry has issued a warning that it would experience its fourth consecutive decline in quarterly sales. This indicates that consumer electronics demand is still very low.
The Taiwanese company, which is also known as Foxconn, reported a significant decrease in sales of 27 percent in December, bringing the total to NT$460.1 billion ($14.8 billion, or approximately Rs. 1,23,073 crore). This brings the total for the quarter to NT$1.85 trillion. The company is now reporting a decline in sales during the current time as well, which adds to the growing anxiety regarding the momentum of the most recent iPhone generation moving into the new year.
Foxconn, which is Apple’s most important iPhone assembly partner, offers valuable insight into the widespread public demand for personal technology. A mixed early reaction was seen in key areas when Apple’s iPhone 15 went on sale in September. In the United States, it was seen as the beginning of an upgrade cycle from earlier generations, while sales in China were seen as declining.
This year, China will once again be a focal point of issues for the iPhone. This is due to the fact that the prohibition on the handset and other Apple hardware at Chinese agencies and state-backed organizations has been expanded, and the local technology giant Huawei Technologies is recuperating market share with its premium Mate 60 series.
Additionally, Foxconn has been the focus of a regulatory inquiry in China, which has shaken the faith of investors as well as the confidence of foreign businesses that are operating in the country as of the end of the previous year. The Chinese competitor Luxshare Precision Industry, which is planning to increase its iPhone production capacity, is posing an increasing threat to the Taiwanese device manufacturer, which is facing a mounting challenge.
According to Counterpoint Research associate director Liz Lee, the volume of iPhone sales is almost certainly going to increase by two percent this year, which is lower than the overall growth of the mobile market, which is expected to be five percent. The sales of smartphones manufactured by Huawei, on the other hand, are anticipated to increase by 37 percent. Barclays and Piper Sandler both lowered their ratings for Apple this week as a result of the lackluster demand for the company’s most recent iPhone.
In order to generate the majority of its revenue, Foxconn is dependent on Apple. The total amount of its sales in 2023 was NT$6.16 trillion, representing a 7 percent decrease.