Foxconn February revenue down 11.65%, but still on track

Foxconn has announced an 11.65% year-on-year dip in February revenue due to weak consumer electronics markets but says it’s still on track to meet expectations – and points to smart consumer electronics as seeing big growth.

But still on track for growth in quarter

Month on month revenue fell 39.12%, which likely reflects more normal patterns of post-holiday electronics consumption. This has traditionally been Apple’s slowest quarter for many years but has benefitted from deferred demand in both 2022 and 2023. January really seemed to benefit from deferred demand as iPhones once again flowed.

This follows recent news from TSMC, the company that makes Apple’s processors for Macs, iPhones and iPads, which recently said sales revenue from “its biggest client” (which we all believe to be Apple) rose 30% year on year in 2022. TSMC revenue reached $17.31b.

In part that’s because even though revenue declined in contrast to last year’s achievement, the current year’s sales are still the second highest sales the company has achieved in the month. It booked $13.18 billion as its factories reopened following China’s Covid lockdowns. Manufacturing at its biggest iPhone factory in Zhengzhou, China, is now back to normal, it said.

iPhone production back to normal

“With operations at the Zhengzhou campus returning to normal, shipments increased in January. Revenue in February declined MoM on a high base,” it said. It also observed that “Due to conservative customers’ pull-in, revenue in February declined YoY.”

Foxconn’s data seems to confirm this. It has seen sales for the first two months of the year increase 17.94%, the company said.

“Based on the revenue performance in the first two months, the outlook for first quarter 2023 is roughly in line with market expectation,” it said. At present that’s 4%. The company will report its Q1 earnings March 15.

Coming up?

We hear speculation of new iPhone models in yellow coming perhaps as soon as next week, which may help build a little more demand. That news may be accompanied by changes in Apple’s financial services, with quite a few whispers claiming Apple may at last be preparing to announce Apple Music Classics along with its slightly delayed Apple Pay savings and BNPL schemes. Later this year Apple is expected to ship its first 3nm iPhone.

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