Foxconn reports fall in Feb sales, sticks to Q1 outlook

TAIPEI (Reuters) – Taiwan’s Foxconn, the world’s largest contract electronics maker and major iPhone assembler for Apple, said on Sunday revenue in February fell 11.65% year-on-year due to weakness in smart consumer electronics, but stuck to its first quarter outlook.

The company stated in a statement that revenue last month was still at T$402.0 million ($13.18billion), the second-highest February record.

After COVID-19 was reintroduced, production of the iPhone was disrupted ahead of Christmas and January’s Lunar New Year holiday. This happened after thousands of workers were forced to abandon Foxconn’s Zhengzhou factory.

The revenue fell by 39.12% in comparison to the preceding month. But cumulative sales for both the first and second quarters of 2013 rose on-year 17.94% due to January’s strong performance. This was when Zhengzhou’s operations got back on track.

Revenue for smart consumer electronics, including smartphones, fell in February year-on-year “due to conservative customers’ pull-in”It said so, but didn’t give any details.

Foxconn produces around 70%, according to analyst estimates. Apple’s flagship models include the iPhone 14 Pro and the iPhone 14 Pro are produced in Zhengzhou.

“Based on the revenue performance in the first two months, the outlook for first quarter 2023 is roughly in line with market expectation,” Foxconn spoke without further explanation.

According to Refinitiv analysts, the growth in first-quarter revenues is expected to be around 4% annually. Taiwan’s tech companies tend to be quieter in the first quarter.

Apple Inc. last month predicted that its revenues would decline for the second quarter. However, iPhone sales are expected to rise as China’s production has resumed normal after the COVID-related shut downs.

Foxconn shares rose 2.6% in the first quarter of this year. This is lower than the 10.4% increase on Taiwan’s broader market.

On March 15, the company will report fourth quarter earnings. It will then provide more information about its outlook.

($1=30.4980 Taiwan dollars)

(Reporting and editing by Ben Blanchard. Editing by William Mallard. Tom Hogue.