Foxconn Posts $19.8B August Revenue, Expects Q3 Growth on Cloud Demand

Foxconn, a partner of Nvidia, reported a 10.7% YoY increase in August revenue to NT$606.5 billion ($19.8 billion). The company expects Q3 sales to grow sequentially and year-over-year, driven by demand in the cloud sector.

Foxconn, a key assembler for major tech giants like Nvidia and Apple, reported a 10.7% year-over-year (YoY) increase in August revenue to NT$606.5 billion ($19.8 billion) [2]. The company expects third-quarter sales to grow sequentially and year-over-year, driven by strong demand in the cloud sector. This performance underscores Foxconn’s strategic pivot towards AI servers, a move that is transforming the company’s revenue base and positioning it as a leader in the global AI infrastructure revolution.

In the second quarter of 2025, Foxconn’s AI server revenue surged 60% year-on-year, with cloud and networking products now outpacing consumer electronics in revenue contribution [3]. This shift is reflected in the company’s net income, which rose 27% in the same period, driven by AI server sales and cost efficiencies in its smart manufacturing platforms [3]. The company is also expanding AI server production in the U.S., with new facilities in Wisconsin and Texas, to mitigate geopolitical risks and tariffs while catering to surging global demand [7].

Foxconn’s partnership with Nvidia is central to this transformation. The two companies are collaborating to construct an AI factory in Taiwan, equipped with 10,000 Blackwell GPUs and NVIDIA’s GB300 NVL72 rack-scale systems. This facility will serve as a hub for AI-driven advancements in smart cities, electric vehicles (EVs), and manufacturing automation [1]. The partnership extends beyond hardware, with Foxconn integrating NVIDIA Omniverse and Isaac platforms to develop digital twin technology, enabling real-time optimization of global manufacturing processes [2].

The financial implications of this collaboration are significant. Nvidia believes data center capital expenditures will reach $3 trillion to $4 trillion by 2030, with Nvidia capturing approximately 35% of all data center infrastructure spending [4]. This growth is expected to drive further demand for AI servers, positioning Foxconn as a key player in this expanding market.

However, challenges remain. Foxconn still derives 35% of its revenue from consumer electronics, exposing it to cyclical demand and supply chain volatility. Despite this, the rapid growth of its AI division suggests a sustainable path to independence [3]. The company’s ability to scale AI deployments across its Smart Manufacturing, Smart EV, and Smart City platforms will be crucial for maintaining momentum.

In conclusion, Foxconn’s strategic shift to AI represents a high-conviction play in the evolving tech ecosystem. By leveraging its partnership with Nvidia, the company is not only diversifying its revenue base but also redefining its role as a leader in AI-driven industrial transformation. For investors, this transition offers a compelling opportunity to participate in the next phase of technological disruption.

References:
[1] Foxconn Builds AI Factory in Partnership With Taiwan and Nvidia [https://nvidianews.nvidia.com/news/foxconn-builds-ai-factory-in-partnership-with-taiwan-and-nvidia]
[2] Foxconn to Build AI Factories with NVIDIA Omniverse [https://www.foxconn.com/en-us/press-center/press-releases/latest-news/1484]
[3] Hon Hai forecasts AI server sales growth to top 170% in Q3 [https://focustaiwan.tw/business/202508140023]
[4] Nvidia believes data center capital expenditures will reach $3 trillion to $4 trillion by 2030 [https://www.nasdaq.com/articles/1-jaw-dropping-projection-makes-nvidia-no-brainer-stock-buy-right-now]
[5] Hon Hai says revenue surged 25.5% last month [https://www.taipeitimes.com/News/biz/archives/2025/05/06/2003836378]
[6] Nvidia Partner Hon Hai's Profit Climbs After AI Spending Rises [https://www.bloomberg.com/news/articles/2025-08-14/nvidia-partner-hon-hai-s-profit-climbs-after-ai-spending-rises]
[7] Nvidia Partner Hon Hai to Expand AI Server Assembly in the US [https://www.bloomberg.com/news/articles/2025-08-04/nvidia-partner-hon-hai-to-expand-ai-server-assembly-in-the-us]