iPhone sales drive Apple’s biggest supplier to big profits

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iPhone sales drive Apple’s biggest supplier to big profits
Apple accounts for an estimated half of all Foxconn revenue.
Photo: CBS

Apple contract supplier Foxconn has announced better-than-expected quarterly profits, rising 23%. Apple accounts for an estimated half of all Foxconn revenue, thanks largely to the iPhone.

Foxconn’s earnings offer another data point about rebounding iPhone sales. At worst, they should pacify any investors concerned about weak global demand for Apple’s smartphones.

3 companies could take over Apple Watch production

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watchOS 5 Face
Your next Apple Watch could be made by Foxconn, who also assembles iPhone and iPad.
Photo: Ste Smith/Cult of Mac

Apple Watch might go through a big change behind the scenes. Until now, this wearable has been assembled mostly by Quanta, but that’s reportedly going to change next year. No less than three companies are going to take on the job.

Apple responds to complaint that Foxconn factory broke labor laws

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iPhone sales drive Apple’s biggest supplier to big profits
Apple says too many temporary workers were employed in Foxconn factory.
Photo: CBS

Apple says that it is working to fix a problem in which too many temporary workers were found illegally working on the iPhone line at a Foxconn factory.

Over the weekend, New York-based watchdog China Labor Watch published a report about alleged violations. These supposedly took place at the biggest iPhone factory in Zhengzhou, China.

However, while Apple acknowledges the group’s point about temporary workers, it maintains the other findings are inaccurate.

Applier supplier Foxconn sales hit new record high

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iPhone sales drive Apple’s biggest supplier to big profits
Foxconn is Apple's biggest contract manufacturer.
Photo: CBS

Life is good if you’re Apple’s biggest contract manufacturer! Foxconn, a.k.a. Hon Hai Precision Industry, has reported its highest-ever August sales in the company’s 45-year history.

Foxconn sales hit $12.76 billion for August. That’s up 0.2% from one month earlier. This is the sixth consecutive month in which Foxconn has registered month-on-month increases. While it can’t necessarily all be chalked up to Cupertino, Apple represents more than 40% of Foxconn’s total sales.

Apple is relying on factories in China more than ever

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Apple and TikTok both absent from congressional hearing about tech in China
China continues to be the epicenter of Apple's manufacturing.
Photo: Ed Hardy/Cult of Mac

Apple may be trying to wean itself off manufacturing in China, but despite its use of factories in Brazil and India, it’s actually relying on China more than ever.

According to Reuters, the majority of Apple suppliers have become increasingly concentrated in China. Although Apple uses small factories outside the country, these are typically used only for small domestic runs.

Foxconn takes heat for using teens to build Amazon devices

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Amazon Echo
Foxconn has another problem with underage workers.
Photo: Jim Merithew/Cult of Mac

Frequent Apple contract manufacturer Foxconn recruited kids as young as 16 to work on its production lines, leaked documents show. The company reportedly pushed the teenagers to work nights and overtime as part of the job.

On this occasion, however, Apple isn’t the company under fire. The recruits (classed as “interns”) were working on the Amazon production line. They were building devices like the Echo smart speakers.

India might steal iPhone production from China

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Long-term iPhone XR demand could eventually lead to greater sales than the iPhone XS.
Foxconn will make all three of these 2018 iPhone models in India for the first time.
Photo: Apple

Apple is reportedly significantly increasing iPhone production in India. Rather than just making low-end handsets, the latest top-tier models will be manufactured and sold there.

These will be less expensive than imported units and might improve Apple’s sales in this huge potential market.

Wall Street worries put the hurting on Apple’s suppliers too

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iPhone 8 Foxconn box
A whole lot of companies rely on Apple.
Photo: Feng

It’s not just Apple which relies on, well, Apple to make money. There’s a whole ecosystem of other companies orbiting the giant Cupertino sun, too. And they’re all affected by whatever news raises or lowers Apple’s share price.

That’s what took place this week when Wall Street’s latest wobble about Apple sent out shockwaves through the supply chain. As a result, a whole lot of companies which do business with Apple suffered their own sympathy stock declines.