Hon Hai first quarter sales down as iPhone disappoints

TAIPEI Wed Apr 10, 2013 6:46am EDT

A security guard patrols at Hong Hai headquarters in Tucheng, Taipei county, June 8, 2010.REUTERS/Pichi Chuang

A security guard patrols at Hong Hai headquarters in Tucheng, Taipei county, June 8, 2010.

Credit: Reuters/Pichi Chuang

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TAIPEI (Reuters) - Hon Hai Precision Industry Co Ltd, the main manufacturer of Apple Inc products, posted a 19 percent decline in sales in the first quarter compared with a year earlier, hurt by disappointing demand for the iPhone.

From January to March, Hon Hai's sales totaled T$808.97 billion ($26.96 billion), down from T$988.34 billion in the fourth quarter and T$1 trillion in the first quarter last year.

"A quarterly decline was expected, but not a yearly decline," said KGI Securities analyst Ming-chi Kuo. "This shows that Hon Hai's revenue depends too much on Apple, and iPhone orders corrected more than expected."

Kao expected the Taiwanese contract manufacturer to post flat sales in the second quarter compared with the first, adding that its net profit is also likely to come under pressure in the first half of this year.

Hon Hai draws an estimated 60 to 70 percent of its revenue assembling Apple's iPhones and iPads, and carrying out other work for the California-based company.

Apple missed Wall Street's revenue forecast for the December quarter. Disappointing holiday sales reinforced fears it is losing its dominance in smartphones.

Shares in Hon Hai edged up 0.12 percent on Wednesday, versus a 0.31 rise in broader market

($1 = 30.0010 Taiwan dollars)

(Reporting by Clare Jim; Editing by Daniel Magnowski)

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Comments (3)
RUBiased wrote:
After reading this article, I suggest that the prudent reader have a look at something that refutes everything this author has written here.

Apr 10, 2013 10:17am EDT  --  Report as abuse
jjkiam wrote:
How can you attribute any declines to Apple alone. Hon Hai’ s list of customers is very wide and Apple does not represent more than50% of their total business. The declines could be far more easily attributed to declining sales for almost all other Hon Hai customers. Also stating that Holiday sales were “disappointing” is based on what? certainly not IPhones which sold 48 million or IPads which sold almost 23 million! This kind of biased untrue negative headline grabbing article is something one thought Reuters wouldn’t stoop to

Apr 10, 2013 10:42am EDT  --  Report as abuse
Come on Clare Jim. Fess up. You got paid by Samesung to write this slander. Clearly there is zero journalism here as it’s total conjecture supported by no facts. Foxconn manufactures products for Microsoft, Dell, IBM, SAMESUNG, and the list goes on yet you make up some farfetched claim that somehow Apple is “disappointing”?

I’ve noticed over the past six months or so that every (absolutely every) story about Apple from Reuters is negative. There is no factual reporting just biased slander going on. Why I could only suppose that Samesung has been the bank roll behind it as they have the most to gain. At the very least you’re doing it to try and get people to click through to your page for the advertising revenue but throwing out integrity and honesty in the process.

You’ve lost any credibility to me as a “news” organization Reuters from here on and when ever I see something attributed to your organization IF I choose to read it it will be with a knowledge that it’s likely fake and being passed off as real.

Apr 10, 2013 4:26pm EDT  --  Report as abuse
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