TAIPEI (Reuters) – Taiwan’s Foxconn, the world’s largest contract manufacturer, reported on Tuesday a bigger fall in quarterly profit than analysts had expected, amid waning demand for electronics from its key customers, including Apple Inc.
Foxconn, formally known as Hon Hai Precision Industry Co Ltd, reported net profit of T$19.82 billion (491.9 million pounds) for the first three months of 2019, down 17.7% from the same period a year earlier, the company said in a statement.
The result lagged the T$24.84 billion average of eight analyst estimates compiled by Refinitiv.
The company did not explain what led to the worse-than-expected profit.
Arthur Liao, an analyst at Fubon Research in Taipei, said ahead of the results that despite slowing Apple iPhone sales, Foxconn is set to benefit from the launch of new iPhone models, expected later this year.
The prolonged downturn in global tech demand has hit profits for Taiwan’s many technology manufacturers this year. TSMC, the world’s biggest contract chipmaker, posted a 32 percent drop in March quarter net profit from a year earlier, citing slowing mobile sales.
Foxconn Chairman Terry Gou, who said last month he would run for president of Taiwan in 2020, met U.S. President Donald Trump earlier this month to discuss the status of the Taiwan company’s planned investment in Wisconsin.
Last month, he told Reuters he planned to step down from the world’s largest contract manufacturer to make way for younger talent to move up its ranks.
Gou, who retained a seat in the company’s proposed new board, said last week he would resign as the chairman to demonstrate his determination to run in Taiwan’s presidential election.
The board proposal is subject to approval at an annual shareholder meeting in June before a chairman can be elected.
(Reporting By Yimou Lee; Editing by Sonali Paul and Neil Fullick)