Shares in Taiwanese iPhone assembler Foxconn have reached decade-year highs over growing optimism about Apple’s upcoming iPhone 8, due to launch in 2017.
According to a new Bloomberg report, Hon Hai Precision Industry – better known as Foxconn – has gained 29 percent in the last year on high expectations for Apple’s 10th anniversary iPhone, which has helped the Apple supplier defy a flat mobile market.
Apple, which accounts for half the company’s revenue, played a pivotal role in the stock’s recent buoyancy. The U.S. company this month reported stronger-than-expected iPhone sales during the key holiday quarter.
While the iPhone 7, introduced in September, failed to convince as many existing customers to upgrade as its predecessor, it did attract new smartphone buyers. That bodes well for the iPhone slated for later this year.
Apple is expected to launch a radically redesigned iPhone this year. The phone is believed to include a glass body, wireless charging, and potentially an edge-to-edge OLED display that integrates a front-facing camera with facial recognition and touch sensors for fingerprint identification. Foxconn may also end up assembling upgraded (but standard) 4.7 and 5.5-inch iPhones alongside the redesigned handset.
Investors hope the iPhone 8 line-up will provide a boost to a stalling industry, with Foxconn reportedly grappling with the slowdown. According to an average of analysts’ estimates compiled by Bloomberg, revenue is projected to slip about 3 percent in 2016, and net income will be down 13 percent. However, earnings growth could rebound to 12.2 percent this year.
In addition to the 10th anniversary iPhone boost, Foxconn is said to be considering building a $7 billion display-making facility in the U.S. Japanese company Sharp is reportedly “taking the lead” on the proposed U.S. site and has set aside $1.8 billion to developing facilities for making OLED displays – the same technology Apple is expected to adopt in future iPhones.
Apple is expected to introduce the iPhone 8 in the fall, with claims of a launch as early as this summer likely based on reports that Apple will ramp up production early, although this may only be to improve yield rates, work out manufacturing issues, and ensure better supplies for a September release.
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Source From: macrumors.com.
Original article title: Foxconn Shares Riding High on Strong iPhone 8 Expectations.
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