Major Apple supplier Foxconn’s net profit plummeted 23.7% in the fourth quarter of 2019, the company has revealed.
While Foxconn has been hit hard by COVID-19, this period actually ends before the extent of the coronavirus became clear. The quarter in question ended December. The earliest known infection of coronavirus occurred on 17 November 2019 in Wuhan, China.
Foxconn’s net profit for the fourth quarter amounted to 47.8 billion new Taiwan dollars ($1.6 billion). In the same quarter one year earlier, Foxconn reported a net profit of $62.6 billion new Taiwan dollars. The company gave no reason for the decline. Revenue for the quarter fell 3.8% to NT$1.74 trillion.
Apple, by comparison, saw its revenue increase 9% in the December quarter to $91.8 billion. iPhone sales increased 8% to almost $56 billion.
Since then, Foxconn has struggled with the coronavirus. In early 2020, it was forced to shutter two of its main iPhone-producing factories in China. When the most critical one reopened, it did so with fewer than 10% of its usual workforce. Foxconn acknowledged that the impact of COVID-19 will likely affect its revenue throughout the year.
Nonetheless, Foxconn seems to be back up and running now. Last week, the manufacturer said that it had hired enough workers at its major Chinese plants to meet seasonal demand for iPhone manufacturing. That appears to be a good sign that labor shortages in China caused by COVID-19 are starting to get back to normal. (Although the recent closure of Chinese movie theaters suggests the country may not be quite out of the woods yet.)
Source: MarketWatch
