Hon Hai Precision Industry Co., best known as Foxconn, saw its sales growth ease in July, suggesting that worries over U.S. tariffs are cooling demand for electronics. At the same time, the company is moving ahead with big bets on data-center gear, including the sale of a U.S. factory, as global tech firms pour money into artificial-intelligence infrastructure.
Sales at Hon Hai rose 7.25% in July to NT $613.8 billion ($20.5 billion) as per Bloomberg, marking the slowest monthly gain since January. That fell short of analysts’ expectations for a 12.2% jump in third-quarter revenue. The company, which also makes iPhones for Apple, had previously said it expected both sequential and year-on-year sales growth in the July-to-September period.
Last week, President Donald Trump imposed a 20% tariff on goods exported from Taiwan to the United States. While electronics shipments are currently exempt, they could still feel the impact of an ongoing U.S. probe under Section 232 of the Trade Expansion Act, which includes semiconductors.
Despite these headwinds, Hon Hai may find brighter spots ahead. As Cryptopolitan reported earlier, the world’s biggest tech names are ramping up capital spending to stay at the forefront of the AI boom. Microsoft, Amazon, Alphabet, and Meta are set to invest more than $344 billion this year combined, much of it aimed at building or upgrading data centers.
Nvidia, a key Hon Hai partner on server assembly, has laid out plans to provide up to $500 billion worth of AI infrastructure in the U.S. over the coming years, working with manufacturers including Foxconn.
Foxconn sells Ohio plant, shifts toward AI focus
In a related move on Monday, Foxconn agreed to sell its former car plant in Lordstown, Ohio, for $375 million, machinery included. The company stressed it would continue using the site for a wider array of products that fit its long-term goals.
Foxconn did not spell out exactly what it will build at Lordstown. It did note, however, that its cloud and networking-gear unit has seen “significant growth” in orders.
An industry source familiar with the deal said the Ohio facility will support AI-focused data centers. At more than six million square feet (557,000 sqm), the plant is roughly six times the size of Foxconn’s Houston factory, which is being readied to produce Nvidia’s GB300 AI servers.
The plant’s backstory dates to 2022, when Foxconn bought the former General Motors small-car factory there, named for the town, from now-defunct Lordstown Motors Corp. for $230 million. The two companies had teamed up to build electric pickup trucks at the site, but the venture unraveled when Lordstown Motors went under and filed suit against its partner.
In its Monday announcement, Foxconn said it sold the factory to one of its “existing business partners” but offered no further details. It added that it remains committed to serving U.S. automotive clients and can quickly ramp up vehicle output if needed.
Foxconn has been stretching beyond its roots as an iPhone maker. Just last week, it formed a strategic alliance with TECO Electric & Machinery (1504.TW) to develop data-center projects.
Hon Hai’s broader business may also have been boosted by brisk demand for Apple gadgets. Apple reported its fastest quarterly revenue rise in more than three years on strong Chinese sales and said it expects current-quarter revenue to climb by mid-to-high single digits compared with a year earlier.
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