Key Nvidia Supplier Foxconn Posts 40% Q2 Revenue Jump on AI Server Demand

Taiwan’s Foxconn, the world’s largest contract electronics maker, said it expects its overall operations to grow on a quarterly and annual basis after reporting a 40% year-on-year ‌rise in second-quarter revenue.

Quarterly revenue for Nvidia Corp. ’s (NASDAQ: NVDA ) server assembly partner and Apple Inc. ’s (NASDAQ: AAPL ) top phone assembler rose to T$2.51 trillion ($79 billion), Foxconn said in a statement on Sunday.

That beat the average of analyst estimates of NT$2.37 trillion as demand for AI-related products drove sales.

Strong ⁠AI demand drove revenue growth for its cloud and networking products division, the company said.

Smart consumer electronics, which ​include iPhones, ​posted “significant” growth, the company said.

Revenue rose 52% ‌year-on-year to T$821.8 billion in June, a record for the month.

The Taiwanese company has cemented its role in the AI hardware supply chain as the world’s largest tech companies boost spending.

Alphabet Inc. (NASDAQ: GOOGL ), Amazon.com Inc. (NASDAQ: AMZN ), Meta Platforms Inc. (NASDAQ: META ) and Microsoft Corp. (NASDAQ: MSFT ) have allocated $725 billion for AI-related investment this year.

Foxconn in March projected strong sales growth in 2026, fueled by sustained AI momentum, The company’s sales are driven by assembling Apple’s iPhones and MacBooks. "Looking ahead to the third quarter, AI rack shipments are expected to maintain growth, and operations will gradually gain momentum as ICT products enter peak season," the Taiwan-based company said. "The outlook for overall operations expects both QoQ and YoY growth.

Global Political Risks Loom Foxconn, known as Hon Hai Precision Industry Co. warned it remains necessary to monitor the "volatile" global political and economic situation.

The Middle East conflict has put pressure on supply chains with the disruption of shipping through the Strait of Hormuz. "The conflict in Iran has thrown global supply chains into disarray," the Bank for International Settlements said on June 28. "Shortages of nitrogenated fertilizers, helium and petrochemical inputs have threatened production of food, semiconductor and manufactured goods." Foxconn and other major tech manufacturers are confronting mounting bottlenecks in electricity supply, advanced chips and critical grid infrastructure.

The rapid global buildout of AI systems has intensified pressure on power networks and semiconductor capacity, complicating production planning across the sector.

Hyperscalers are rapidly expanding data‑center footprints worldwide, driving sustained orders for AI servers, power systems and advanced thermal‑management equipment.

The company’s shares rose ​4.3% this ​year, underperforming the 61.5% rise for the Taiwan market.

The stock closed up 0.6% on Friday ahead of ​the revenue data ‌release.