News
Foxconn server business overtakes mobile as primary revenue source in late 2025
Sunday, March 22, 2026 at 04:58 AM
During the final quarter of 2025, Foxconn reported that its server business surpassed its mobile division to become its largest revenue driver. This shift occurred even during the peak seasonal period for iPhone shipments, signaling a structural change in the company's business model as AI infrastructure demand grows.
Context
In a historic shift for the world’s largest contract electronics manufacturer, Foxconn (Hon Hai Precision Industry) announced that its Cloud and Networking segment, fueled by AI server demand, overtook mobile handsets as its primary revenue source in late 2025. During the Q4 earnings call on March 16, 2026, Chairman Young Liu confirmed that this division accounted for 40% of total annual sales, surpassing the 38% share held by smart consumer electronics. The company reported record full-year 2025 revenue of NT$8.1 trillion, an 18% year-over-year increase, driven by massive infrastructure spending from global cloud service providers.
Addressing the sustainability of this trend, Chairman Young Liu stated, "We have not seen CSP (cloud service providers) demand slowing down. There are (market) rumours that CSP demand will peak this year, and then it will go down next year. But we are not seeing that... at least for Foxconn." He further projected that AI server shipments could double in 2026, with the company already securing a 40% global market share in the sector. To support this growth, Foxconn is expanding its specialized production capacity in Mexico, Texas, and India to mitigate geopolitical risks and meet the high-volume requirements of partners like Nvidia.
Sources (9)
Quarterly Reports - Hon Hai Technology GroupFoxconn's profit lags estimates as it forecasts strong revenue growth | ReutersResearch Update: Hon Hai And Foxconn Industrial I | S&P Global RatingsFoxconn sees AI server market splitting GPU-ASIC 8:2 as CSP demand surgesFoxconn Expects AI Demand to Remain Strong, Sees Limited ... - WSJFoxconn is moving beyond iPhones, and the next business is growing even fasterFoxconn Expects AI Demand to Remain Strong, Sees Limited Mideast Impact — Update | MorningstarTRANSCRIPT
Related Companies
Foxconn
2317
Apple
AAPL