Foxconn's February Sales Plunge by 11.7% Despite Chinese Market Boost for iPhone Production

Foxconn recently reported that its February sales plunged 11.7% compared to the previous year.

Bloomberg reports that the monthly revenue dropped to $13 billion last month, despite the boost from China's post-lockdown reopening.

The Lunar New Year holidays, which this year fell in January while occurring in February in 2022, were primarily the reason for the decline.

According to the company's statement on Sunday, March 5, despite this decline, Foxconn's first-quarter outlook is "roughly in line with market expectations" based on sales data from the previous two months.

Foxconn's Post-Covid 19 Recovery

Foxconn, also known as Hon Hai Precision Industry Co., is an Apple supplier whose massive iPhone assembly complex is located in Zhengzhou, China.

After delays caused by the COVID outbreak and lockdowns, this complex's output resumed normal operations in January.

Foxconn's iPhone plant in Zhengzhou reportedly neared full production after December shipments reached approximately 90 percent of the original projections.

Currently, the company is focusing on the popularity of iPhones since global demand for smartphones has so far been declining.

Foxconn Expands to India

According to reports, Foxconn or Hon Hai Precision Industry Co Ltd (known formally) is also expanding its operations in India. Manufacturers are searching for alternative production locations in response to escalating tensions between China and the United States.

Foxconn has experienced supply chain disruptions in China, prompting the company to seek expansion opportunities elsewhere.

CNN reports that the company is looking for Indian partners for semiconductor development and electric vehicle collaboration.

Young Liu, the CEO of Foxconn, recently traveled to India and met with Prime Minister Narendra Modi, but he declined to disclose any investment spending during his trip.

Bloomberg stated in a separate report that Foxconn intends to invest approximately $700 million in a new iPhone component manufacturing facility in Karnataka, India.

The investment promotion office of Karnataka confirmed that Foxconn had agreed to a major deal, with 300 acres of land allocated for the facility. The project is anticipated to generate 100,000 jobs over the next decade.

Foxconn Remains Optimistic

Despite February's sales decline, Hon Hai's outlook for the first quarter remains positive, and the company is projected to keep up its expansion in India.

The investment in a new manufacturing facility in India is part of Hon Hai's strategy to broaden its operations and reduce its reliance on a single country.

News Brief

Despite the boost it received from China's reopening, Hon Hai Precision Industry Co.'s February sales were 11.7% lower than the previous year.

The decline was primarily caused by the Lunar New Year holidays falling in January this year, compared to February in 2022.

According to the company's strategy to reduce its dependence on China, Hon Hai plans to invest approximately $700 million in a new plant in India to increase production there.

Stay posted here at Tech Times.