Foxconn Industrial Internet (601138) H1 2024 earnings summary

Executive summary

• Revenue for H1 2024 reached RMB 266.1 billion, up 28.7% year-over-year, driven by surging AI server and cloud computing demand.

• Net profit attributable to shareholders was RMB 8.74 billion, up 22% year-over-year; adjusted net profit (excluding non-recurring items) grew 13.2%.

• Cloud computing revenue rose 60% year-over-year, with AI server revenue up over 230% and accounting for 43% of total server sales.

• Communication and mobile network equipment revenue grew at a high single-digit rate, with 400G/800G switch sales up 30% year-over-year.

• Cash flow from operations dropped 81.9% year-over-year due to increased purchases and service payments.

Financial highlights

• Operating income for H1 2024 was RMB 9.6 billion, up from RMB 7.7 billion in H1 2023.

• Gross margin was 6.7%, slightly down from 7.2% a year ago.

• Basic and diluted EPS were RMB 0.44, up 22.2% year-over-year.

• Cash and equivalents at period end were RMB 68.3 billion, down from RMB 83.5 billion at 2023 year-end.

• Total assets reached RMB 293.2 billion, with net assets attributable to shareholders at RMB 138.7 billion.

Outlook and guidance

• Management expects continued strong demand for AI servers and cloud infrastructure, with robust order visibility and capacity in place.

• Ongoing investments in R&D and global capacity expansion to capture digital economy and AI growth opportunities.

• Company will continue to focus on high-end manufacturing, semiconductors, and new energy vehicle components for future growth.