Foxconn, the world’s largest electronics contract manufacturer and a key supplier to Apple and Nvidia, downgraded its full-year growth outlook on Wednesday, pointing to the recent appreciation of the Taiwan dollar and ongoing tariff uncertainties tied to U.S. trade policy.
Although AI server demand remains strong and drove a 91% year-on-year surge in Q1 profit, Foxconn Chairman Young Liu struck a more cautious tone, dialing back earlier projections of “strong growth” for 2025 to a revised outlook of “significant growth.”
💱 Currency & Trade Pressure
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The Taiwan dollar’s appreciation against the U.S. dollar, possibly linked to unconfirmed Washington-Taipei currency coordination, is impacting Foxconn’s converted revenues.
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Liu noted the exchange rate issue “may affect the performance of the revenue amount after conversion into Taiwan dollars.”
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The U.S.-China trade landscape, despite a recent 90-day tariff truce, still weighs heavily on global supply chains. Foxconn’s footprint in China and Mexico exposes it to ongoing tariff volatility.
“Rapid changes in U.S. tariff policies and exchange rate fluctuations add to uncertainty. We are adjusting our outlook accordingly,” said Liu.
⚙️ Growth in AI and Automotive Still Intact
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AI server revenue expected to grow at high double-digit rates YoY in Q2.
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January–March revenue rose 24.2% YoY, a record for Q1.
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Net profit hit T$42.12 billion ($1.39 billion), beating the T$37.8 billion consensus from analysts (LSEG).
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Nvidia aims to produce $500B worth of AI servers in the U.S. over four years with help from Foxconn and TSMC.
🚗 EV Expansion and Japan Ties
Foxconn is also pushing ahead in electric vehicles:
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Its EV arm Foxtron signed an MOU with Mitsubishi Motors last week.
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Talks continue with Japanese automakers — including possible cooperation with Nissan, though no formal stake has been announced.
“There is some progress with Japanese firms, but nothing to disclose yet,” said Liu.
📉 Market Reaction & Outlook
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Foxconn shares are down 11.4% YTD, underperforming the Taiwan index (down 5.4%).
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Shares rose 3.2% on Wednesday ahead of the earnings call, buoyed by strong AI server results but tempered by macroeconomic caution.
While Foxconn’s AI and EV sectors remain growth pillars, currency dynamics and geopolitical frictions—especially with the Trump administration’s aggressive tariff stance—are pushing the firm toward risk-adjusted forecasting in 2025.