Foxconn said its capital expenditure (Capex) for 2023 will be higher than this year in order to maintain the competitiveness of existing ICT business and expand new ones under the “3+3” strategy.
Foxconn did not reveal details on its investment plan for next year.
Among the regions, China will still account for the highest overall capex ratio, while production capacity expansion will continue for Taiwan, Vietnam, India, Mexico, the United States, and the Czech Republic, in response to customer and market demands.
Foxconn will aim to maximize profit in its operations and the outlook for gross profit margin next year is neutral.
Foxconn, one of the leading suppliers to Apple Inc, said it expected smartphone revenue to fall this quarter and is adjusting production to prevent recent COVID-19 curbs at a massive iPhone factory in China from impacting holiday orders.
Foxconn has grabbed headlines in recent weeks, with tight virus restrictions at its Zhengzhou plant, the world’s largest iPhone factory, disrupting production and fuelling concerns over the impact of China’s virus policy on global supply chains. The plant in China’s industrial hub employs about 200,000 people.
“We will definitely work all out to adjust our production capacity and output, so there is no impact on demand for these two holidays,” Foxconn Chairman Liu Young-way said.
The cost impact of the COVID controls, including offering bonuses to retain workers, will be short term and Foxconn has been working with the government to resume production as soon as possible, he added.
Foxconn said it would continue production in Zhengzhou under a “closed loop” system, where staff live and work on-site in a bubble isolated from the wider world.
Revenue in the third quarter of 2022 reached NT$1.7466 trillion, up 24 percent on year, a substantial growth that exceeded the company’s expectations, mainly due to strong demand for consumer smart products.
The Taiwanese company said net profit for the July-September quarter rose 5 percent to T$38.8 billion from T$36.98 billion a year earlier.
Foxconn said it expects a slight decline in fourth-quarter revenues for its smart consumer electronics business, which includes smartphones, and significant growth for cloud and network products.
It also forecast strong growth for fourth-quarter revenues in computing products, which includes laptops.
Apple has fallen victim to China’s strict COVID policy as Foxconn accounts for 70 percent of iPhone shipments globally. California-based Apple lowered its forecast for shipments of the premium iPhone 14 models, Reuters news report said.