“Hon Hai Precision Industry Co., assembler of Apple Inc.’s iPhones and iPads, posted a 41% rise in second-quarter net profit, helped by strong iPhone sales,” Lorraine Luk reports for The Wall Street Journal.
“But the profit jump is unlikely to soothe concerns that the company, which earns more than 40% of its revenue from Apple, faces challenging times ahead as Apple’s growth momentum slows,” Luk reports. “Hon Hai’s shares, traded in Taiwan, have fallen about 12% since the beginning of 2013, mirroring Apple’s losses earlier this year on concerns over customer fatigue with iPhones and iPads. The benchmark Taiex stock-market index gained 3.6% during the same period.”
Luk reports, “Last month, Apple said its fiscal third-quarter net profit fell 22% from a year earlier to $6.9 billion on roughly flat revenue of $35.3 billion, even though the company sold 20% more iPhones than a year earlier. Hon Hai, which has factories across China and uses the trade name Foxconn Technology Group, recorded a turnaround at a handset manufacturing unit, FIH Mobile. FIH Mobile, which is listed in Hong Kong and 68%-owned by Hon Hai, said Monday it swung to a net profit of US$17.2 million after reporting net losses for the past four years.”
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