iPhone Assembler Foxconn Posts Near 90% Drop in First Quarter Profit

Apple's main iPhone assembler Foxconn posted an almost 90 percent drop in first-quarter profit on Friday, as the impact of the global health crisis hit production demand from clients (via Reuters).

chinafoxconn
But the Taiwanese electronics manufacturer said the worst was over, and the company would "stabilize in the second quarter," adding that it expects revenue to show double-digit growth in comparison to the first quarter.

Foxconn reported net profit of T$2.1 billion ($70.25 million) for the January-March quarter, falling well short of a Refinitiv consensus estimate of T$8.88 billion drawn from 14 analysts.

Foxconn slashed its 2020 revenue outlook in March after strict quarantines were enforced at its China plants for a period in February, at the height of the crisis, which has now largely resolved in the country.

Apple sold fewer than 500,000 iPhones amid the ongoing curbs on travel and transport – a 60 percent slump in ‌‌iPhone‌‌ sales compared to the February 2019 quarter. The same month, Apple announced that its financial guidance for the March quarter would fall short. Foxconn went on to suffer its biggest monthly drop in revenue in about seven years because of the containment measures.

The manufacturer had earlier claimed the viral outbreak had had a "fairly small impact" on ‌‌‌iPhone‌‌‌ production, suggesting its factories in other countries like Vietnam, India, and Mexico had been able to fill the gap.

It and other factories in China have reportedly implemented stringent measures to prevent the another viral outbreak in the country, while the Chinese government is mandating that employers check temperatures and provide face masks to employees, as well as submitting daily reports on workers' health statuses.

Foxconn has since resumed normal operations at all of its main factories in China.

Tags: China, Foxconn

Top Rated Comments

j-beda Avatar
52 months ago
A 90% drop in profits still leaves 10% of the profits, after paying all of the expenses. $70.25 million profit is MUCH better than any size of loss, and this is just one quarter.

Maybe the headline should be "Even in a pandemic, Foxcom is still making money!"
Score: 10 Votes (Like | Disagree)
otternonsense Avatar
52 months ago
Foxconn produces way more devices than just Apple's though. Their revenue outlook cannot just apply to Apple alone (I presume), and I wonder what the impact was on the entire Apple product family, from the iPhone to the iPad to the Mac. I recall reading, for instance, that iPad and Mac sales actually increased due to switching to work from home.
Score: 3 Votes (Like | Disagree)
meaning-matters Avatar
52 months ago

Sorry, but I just can't seem to shed a tear for Foxconn.
You don't realise this might be a sign of economic downfall that may also hit you?

A bit further from home: You can't shed a tear for these hard working people that might be laid off?
Score: 3 Votes (Like | Disagree)
NBAasDOGG Avatar
52 months ago

Nope, employers cannot work for free, just like you, they must be able to buy bread.
For Apple to drop prices...
More people buy and Foxconn can assemble more iToys.
Score: 3 Votes (Like | Disagree)
calzon65 Avatar
52 months ago
Sorry, but I just can't seem to shed a tear for Foxconn.
Score: 2 Votes (Like | Disagree)
ericwn Avatar
52 months ago
For Apple to drop prices...
More people buy and Foxconn can assemble more iToys.
Ah I see we are at the “itoy “ level on comment 4 already. Sweet.
Score: 2 Votes (Like | Disagree)

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