Foxconn in Trouble as Q1 Profits Plunge by 90% Due to COVID-19

Foxconn, a Taiwanese multinational electronics contract manufacturer, also known as the Hon Hai Precision Industry Co., Ltd., is one of the many companies that has taken a massive hit due to the coronavirus pandemic.

The company that ranked 24th among the Fortune Global 100 in 2018 has reported an almost 90% drop in first-quarter profit on Friday. The main reason for this major plunge is the low demand from major clients, including Apple and the disrupted production.

However, the company is hopeful that the worst is over, and Foxconn Technology Group will do considerably better in the second quarter. While talking about its future plans, the company said that Hon Hai will stabilize in the second quarter.

Foxconn also detailed that it expects its revenue to show double-digit growth in the second quarter from the first quarter. Moreover, the company has reported that all of its main factories in China have now resumed normal operations.

As far as the revenues in Q1 are concerned, the Taiwanese company reported a net profit of T$2.1 billion ($70.25 million) for the January-March quarter, falling short of the consensus estimate of T$8.88 billion drawn from 14 analysts. Apart from this, the company’s shares closed 1.4% lower ahead of the results on Friday.

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