When the world's largest contract electronics manufacturer posts a blowout quarter, people pay attention. And when that manufacturer happens to build AI servers for Nvidia Corp. (NVDA) and assemble iPhones for Apple Inc. (AAPL), Wall Street really starts connecting dots.
Foxconn Technology Group (HNHAF), formally known as Hon Hai Precision Industry Co., Ltd (HNHPF), delivered exactly that kind of quarter on Monday. The Taiwanese manufacturing giant reported fourth-quarter revenue of NTD 2.6 trillion, which translates to roughly $82.7 billion. That's a 22% jump from last year and comfortably ahead of the NTD 2.42 trillion consensus estimate compiled by LSEG.
AI Infrastructure Drives the Beat
The headline number is impressive, but the story behind it matters more. Foxconn's cloud and networking products segment carried the quarter, fueled by what can only be described as voracious appetite for AI servers and server rack solutions. This is where Foxconn's relationship with Nvidia becomes relevant. The company serves as a key manufacturing partner for the chipmaker, assembling the servers that house Nvidia's GPUs used in AI training and data center operations.
In U.S. dollar terms, revenue climbed 26.4% year over year. December alone brought in NTD 862.86 billion, up nearly 32% from the prior year and marking the strongest December in company history. Foxconn noted that quarterly revenue exceeded both sequential and annual comparisons, beating even its own internal projections.
What This Means for Nvidia and Apple
Gene Munster, managing partner at Deepwater Asset Management, flagged the results as a bullish indicator for both Nvidia and Apple. He pointed out that Foxconn didn't just beat estimates—it crushed them by 8%, delivering 22% growth against Wall Street's more modest 13% forecast.
Given Foxconn's role manufacturing Nvidia GPUs and related infrastructure, the strength in cloud and networking products suggests demand for AI hardware remains robust. "It's also a positive read on $AAPL iPhone demand for the December quarter," Munster added.
That second point is worth noting because Foxconn's smart consumer electronics division, which handles iPhone assembly, actually posted a slight decline during the quarter. But before anyone panics, the company attributed that drop largely to unfavorable foreign exchange movements rather than weakening demand. Munster clearly isn't worried, and his read-through to Apple demand suggests the underlying fundamentals look healthy.
Looking Ahead
Foxconn will release full fourth-quarter earnings details in March, which should provide more color on margins and segment performance. For now, the revenue beat sets a high bar for early 2025 comparisons.
As for the stocks Munster is drawing connections to, Nvidia shares have climbed 25.89% over the past 12 months, while Apple has gained 9.09% during the same period. Market data shows Nvidia ranking in the 94th percentile for growth and 97th percentile for quality among comparable stocks.
The takeaway here is straightforward: when your contract manufacturer posts record results driven by the products you design, that's typically a good sign. Foxconn's quarter suggests the AI infrastructure boom isn't slowing down, and iPhone demand is holding up better than some feared.
