Strong global demand for artificial intelligence infrastructure is giving Foxconn growing confidence in its future business expansion, according to Chairman Young Liu.
Speaking at the company’s annual shareholders meeting in New Taipei, Liu said the traditional mid-year slowdown for technology suppliers is no longer taking place due to rising AI investments across the industry.
“Unless a highly severe ‘black swan’ event occurs – which I haven’t seen, and there are currently no signs of – based on what we see now, the second half of the year looks very good,” Liu said.
Foxconn, the world’s largest contract electronics manufacturer, is a major supplier for companies including Nvidia and Apple. The company manufactures AI servers and assembles iPhones globally.
Liu highlighted the rapid increase in spending by major cloud service providers, saying their combined capital expenditure has already crossed $700 billion this year and could potentially reach $1 trillion next year.
“Their capital expenditure is our market. It has already reached $700 billion, and their capital expenditure next year is expected to potentially reach $1 trillion. This gives us immense confidence in our future growth momentum,” he said.
Earlier this month, Foxconn reported a stronger-than-expected 19% increase in first-quarter profit, driven largely by demand for AI servers.
The company also announced plans to increase capital expenditure by 30% this year compared to last year’s T$174 billion, as it expands manufacturing capacity for AI-related products.
Addressing concerns around the global shortage of memory chips, Liu said some high-end customers had experienced limited impact, but the situation was not severe enough to disrupt operations significantly.
“If the high-end market is impacted, the entire world will feel it, and we hope that doesn’t happen. So for us, the current situation is that the impact on our clients through the end of the year is limited,” he added.
Foxconn’s shares closed 9.9% higher on Friday after positive forecasts from Dell boosted investor confidence in the AI server market. However, despite gaining 25% this year, Foxconn shares have still underperformed the broader Taiwan index, which has risen 55%.
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