Apple’s top iPhone maker’s new AI server business is sending revenues on a tear—and helping its shares finally hit a price its founder promised back in 2016

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Hon Hai Precision Industry Co.’s June-quarter sales outperformed analysts’ rising expectations on the strength of the company’s growing AI server business.

The iPhone assembler, also known as Foxconn, said Friday that its revenue in June was NT$490.7 billion ($15.1 billion), making for a total of NT$1.55 trillion for the quarter, up 19%. An average of analyst estimates pointed to a 13.8% rise, with expectations growing after Hon Hai said a month earlier that it expected the AI business to help it beat estimates for the quarter.

Hon Hai’s Taipei-traded shares have more than doubled this year and hit new highs in June on hopes the company can capitalize on the AI boom. It had gone through a tough 2023, as sales shrank due to moribund demand for the consumer electronics it assembles. But the company’s rapidly adding revenue from orders for artificial intelligence servers and other data center gear, diversifying away from the mature business of making smartphones. 

“The third quarter is expected to generate growth compared to the second quarter and the same period last year,” Hon Hai said in a statement accompanying its monthly sales release on Friday.

Excitement about Hon Hai’s role in the AI hardware market helped its shares breach the NT$200 level that founder Terry Gou had pledged to achieve in 2016. The AI boom has also brought much focus to Taiwan this year, making the latest Computex event a huge success with CEOs from the biggest US chipmakers all coming to woo key suppliers and data center equipment makers.

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