Foxconn's second quarter earnings boost by 40.8% due to strong iPhone sales
On Tuesday, Foxconn Technology Group, a company known for assembling mobile phones for Apple Inc., released its second quarter earnings report. Foxconn's profit climbed 40.8% year on year due to strong sales of iPhones and reduced costs by building factories in China.
Foxconn's net profit during the quarter ended June 30, 2013 rose to TWD16.9 billion, which was an increase from last year's TWD12 billion. The Taiwanese manufacturer's revenue for the second quarter surged 0.4% to TWD896 billion. Moreover, Foxconn's gross profit margin dropped 5.8% in the quarter, as compared with 2012's 6.1%.
The Wall Street Journal said Apple's net profit plunged 22% from 2012, but the Cupertino, California-based company sold 20% more iPhones this year than a year ago. The paper added that Foxconn generated over 40% of its revenue from making Apple's devices.
"The profit numbers reflect lower costs as its move of plants to inland China has helped reduce labor costs," Beyond Asset Management president Michael On said. "The second half should be better as Apple will introduce new products."