Foxconn sees 19% decline in sales after 'disappointing' demand for Apple's iPhoneSales were down 19 percent in the first quarter at Foxconn, manufacturer of devices for Apple and others, in a decline that was reportedly driven primarily by lower iPhone sales.
Total sales were $808.97 billion Taiwan, or $26.96 billion U.S., at Hon Hai Precision Industry Co. Ltd., also known as Foxconn, in the quarter spanning from January to March, according to Reuters. The 19 percent year-over-year decline was attributed to "disappointing demand for the iPhone" in the report published on Wednesday.
Cited in the report was KGI Securities analyst Ming-chi Kuo, who indicated that a quarterly decline was expected, but a year-over-year drop was not. It's estimated that as much as 70 percent of Foxconn's revenue comes from assembling Apple's popular iPhones and iPads.
"This shows that Hon Hai's revenue depends too much on Apple, and iPhone orders corrected more than expected," Kuo said.
The news will likely further drive speculation that Apple could disappoint with its own forthcoming quarterly earnings. The company is set to report its own earnings for the January-to-March quarter on April 23.
As pessimism around Apple has grown, some market watchers have predicted that the company could potentially miss its own guidance for its second fiscal 2013 quarter. That's prompted some analysts to cut their price targets, while major shareholders have sold some of their positions in the iPhone maker.
On Topic: iPhone
- 'iPhone 7' might replace 3.5mm headphone jack with second speaker, analysts say
- AT&T lays plans to begin testing 5G data in 2016, brings back 2-for-1 iPhone deal
- Apple captured 21% of smartphone processors, 31% of tablet CPUs in 2015
- TestFlight gets support for iOS 9.3, watchOS 2.2 betas
- FBI complains it can't break encryption on phone used by San Bernardino terrorists