iPhone maker Foxconn’s sales decline as China begins probe
Hon Hai Precision Industry Co.’s October sales slid, reflecting uncertainty in its business after Beijing launched an investigation into the world’s biggest iPhone assembler.
Hon Hai Precision Industry Co.'s October sales slid, reflecting uncertainty in its business after Beijing launched an investigation into the world's biggest iPhone assembler.
Apple Inc.'s most important partner, also known as Foxconn, reported a 4.6% decline in October revenue to NT$741.2 billion ($23 billion). It's also sticking with a “significant growth outlook” for the December quarter, which is typically Hon Hai's busiest because of year-end iPhone shipments. Apple's latest iPhone 15 hit store shelves in September.
“Operations will ramp up sequentially,” the company said in a brief statement, without elaborating.
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The investigation in China complicates Apple's position in its largest international market and production base. Regulators there are conducting tax audits and reviewing land use by Foxconn, state media said on Oct. 22.
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Investors have grown skittish about the iPhone's prospects in China, which accounts for about a fifth of Apple's sales. The country's consumer economy is reeling, while US businesses face an increasingly hostile environment as a technology conflict with the US persists. Huawei Technologies Co.'s surprise debut of a smartphone with an advanced made-in-China 5G processor also tapped nationalist sentiment and has taken sales away from the iPhone.
Hon Hai, Foxconn Technology Group's public arm, has said it will cooperate with authorities. But shares of the company and its mainland-listed unit, Foxconn Industrial Internet Co., have tumbled on the news of the probe, shedding about $9 billion of value at one point.
Separately, Taiwan is also investigating suspected bribes connected to Foxconn founder Terry Gou's presidential campaign, as the billionaire submits signatures to run in next year's election.