iPhone Maker Foxconn Barely Grows Sales as Tech Demand Withers

Hon Hai Precision Industry Co. increased revenue by only 3.9% last quarter, underscoring how fears of a recession are crimping demand for iPhones and other consumer electronics.

The world’s largest maker of Apple Inc. ’s devices, known also as Foxconn, reported revenue of NT$1.46 trillion ($48 billion) for the usually slower March quarter. That’s down steeply even from the previous three months, when a Covid outbreak prompted protests at its main Zhengzhou facility in central China, disrupting iPhone production for weeks. That complex, known as “iPhone City” for being the largest global production site for Apple’s marquee device, resumed normal operations only in January.

Analysts estimated revenue of NT$1.45 trillion on average for the first three months of the year. Hon Hai also said that it expects a decrease in business in the second quarter on a year over year and quarterly basis.

Investors are struggling to gauge how the popularity of iPhones and mobile devices will hold up this year. Xiaomi Corp.’s smartphone shipments dived 26% in the fourth quarter after consumers worldwide put off spending on items such as electronics during a period of soaring inflation.

Manufacturers such as Foxconn — which also makes iPads and gadgets for many of the world’s biggest brands — are now re-examining an electronics supply chain centered on China. The Taiwanese firm plans to invest about $700 million in a new plant in India to ramp up production there, as more manufacturers shift from China to reduce fallout from growing Washington-Beijing tensions.