Foxconn Technology (OTCPK:FXCOF) provided a bright outlook for next year, pointing to AI-related demand as a big driver of growth in 2026, and teased an announcement for next week with OpenAI (OPENAI).
The company’s third quarter revenue jumped 11% year-over-year to NT$2.059T.
The Apple (AAPL) supplier — which is formally known as Hon Hai Precision (OTCPK:HNHAF) (OTCPK:HNHPF) — saw net profit (attributable to the owners of the parent company) jump 17% year-over-year to NT$57.67B ($1.89B).
This was higher than the consensus estimate of NT$50.4B compiled by LSEG, Reuters reported.
Foxconn Chairman Young Liu said on an earnings call that the importance of AI would massively increase next year, but the company would also keep an eye on geopolitical and currency issues, the report added.
“Generally speaking, judging from what we see now, I am very optimistic about the AI market next year,” said Liu.
Nvidia (NVDA) is among the company’s prominent customers.
“The development of AI is still just beginning,” Liu added.
In the third quarter, revenue of Foxconn’s cloud and networking business, which includes AI servers, surpassed that of its smart consumer electronics business.
Foxconn noted that strong growth in AI servers lifted the share of Cloud and Networking Products to 42% from 41% in the previous quarter, keeping it as the largest contributor to overall revenue.
The company noted that third-quarter AI server rack shipments grew 300% quarter-over-quarter, enabling cumulative AI server revenue to reach the “NT trillion-dollar scale” ahead of schedule.
Looking to the fourth quarter, shipments of next-generation AI server racks are expected to sustain double-digit sequential growth, according to the company.
Foxconn noted that, according to market projections, the top five U.S. cloud service providers, or CSPs, are expected to invest nearly $600B in capital expenditure in 2026, underscoring the continued strength of AI server demand.
Foxconn added that the move into traditional peak season for Information and Communication Technology, or ICT, products has led to the proportion of Smart Consumer Electronics rising to 37% from 35% marking the largest degree of increase when compared to the earlier quarter.
Outlook
For the fourth quarter, Foxconn said it is optimistic about the performance of AI and smart consumer electronics, which are expected to show significant growth momentum both quarter-on-quarter and year-on-year.
For the full year 2025, Liu said that he maintains his view of significant growth for the full year, but revised upwards the full-year outlook for smart consumer electronics products to flat from a previous view of a slight decline.
The Taiwan-based company noted that among the four major product categories, cloud and networking products remain the main growth driver this year.
For 2026, Liu offered a very optimistic outlook. He pointed out the development of the AI industry, the political and economic situation, and monetary policy will be the most important influencing factors next year – the development of the AI industry being the most positive and crucial.
Foxconn said it is optimistic about the AI field, expecting closer collaboration with major customers, expansion into more diverse AI solutions, and securing more orders.
Regarding the traditional ICT industry, he is cautiously optimistic, noting that in addition to stable business, there is potential demand for upgrades and new product development, the company added.
OpenAI-Related Announcement
Foxconn’s flagship annual technology conference, Hon Hai Tech Day (HHTD25), will be held from Nov. 21 to Nov. 22 at Taipei Nangang Exhibition Center.
Liu noted that there would be an announcement related to OpenAI at that event. However, he did not provide details, the report added.
OpenAI did not immediately respond to a request for comment from Seeking Alpha.