Apple assembler Foxconn cuts outlook due to appreciation of Taiwan dollar

The logo of electronics contract manufacturer Foxconn Technology Group, formally known as Hon Hai Precision Industry, is displayed at its headquarters in Taipei. Photo: Agence France-Presse
Taiwan’s Foxconn, the world’s leading contract electronics manufacturer, lowered its full-year outlook on Wednesday due to the recent strengthening of the Taiwan dollar, despite optimism about strong demand for AI servers. As Apple’s primary iPhone assembler and a key producer of Nvidia’s AI servers, Foxconn has benefited from the surge in AI demand but remains exposed to shifts in U.S. trade and tariff policies due to its extensive manufacturing operations in countries like China and Mexico.
Reuters:
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Chairman Young Liu said on an earnings call that U.S. tariffs will bring more challenges and his outlook for the full year was more cautious than previously, after the company predicted significant growth for 2025 compared with a previous outlook of strong growth.
He said the reason for the change in the outlook was the recent changes in the value of the Taiwan dollar against the greenback, which has risen in value on speculation – denied by Taiwan’s government – that Washington asked Taipei to allow its appreciation as part of tariff talks.
“Because of the exchange rate, it may affect the performance of the revenue amount after conversion into Taiwan dollars. Therefore, compared to March, our outlook for this year is a bit more cautious, so we slightly adjusted our outlook for this year to significant growth,” Liu added.
Most of the iPhones Foxconn makes for Apple are assembled in China…
In its earnings report, Foxconn said it should see significant on-year growth in the second quarter, with high double-digit growth year-on-year for AI servers and an accelerating volume production ramp-up.

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MacDailyNews Take: Headwinds.
As per Grok 3, the Taiwan Dollar (TWD) to U.S. Dollar (USD) exchange rate has experienced notable fluctuations over the past three months (February 14, 2025, to May 14, 2025), driven by economic factors, trade policies, and central bank interventions.
Exchange Rate Summary (TWD to USD, February 14, 2025 – May 14, 2025)
90-Day Range:
• High: 0.03427 USD per TWD on May 5, 2025
• Low: 0.03006 USD per TWD on March 31, 2025
• Average: Approximately 0.0308 USD per TWD
• Overall Change: The TWD appreciated by approximately 8.42% against the USD over the 90-day period.
Key Trends:
• February to March 2025: The TWD remained relatively stable, hovering around 0.0305–0.0310 USD, with a dip to the period’s low of 0.03006 USD on March 31, 2025, likely due to global market dynamics and U.S. dollar strength.
• April 2025: The TWD began appreciating, driven by easing U.S.-China tensions and anticipation of U.S. trade policies, including tariffs. By late April, the exchange rate approached 0.0315 USD.
• Early May 2025 Surge: The TWD saw a historic rally, jumping 9% in two days (May 4–5), reaching a peak of 0.03427 USD on May 5, 2025. This was attributed to heavy foreign fund inflows, speculation about U.S.-Taiwan trade talks, and a weakening U.S. dollar.
• Mid-May 2025 Correction: After the surge, Taiwan’s central bank intervened to curb excessive volatility, leading to a 3% weakening of the TWD against the USD on May 6. By May 14, the exchange rate settled at approximately 0.0328 USD (based on 1 USD = 30.455 TWD).
Influencing Factors:
• U.S. Trade and Tariff Policies: Speculation about U.S. tariffs and trade negotiations, including a suspended 32% import tax on Taiwan, fueled TWD appreciation.
• Central Bank Actions: Taiwan’s central bank intervened to moderate the TWD’s rapid rise, denying claims of exchange rate talks with the U.S..
• Global Currency Dynamics: A faltering U.S. dollar and strong global chip demand bolstered Taiwan’s export-driven economy, supporting TWD strength.

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