Apple Supplier Foxconn Boasts Record Profits Thanks To iPad Line and iPhone 5

FoxconnEarlier this month, analysts were championing the downfall of Apple, saying that suppliers had just suffered “the worst February on record.” At the same time, Hon Hai, Foxconn’s parent company, had announced it would be hiring 5,000 new workers for 2013. Today, Bloomberg reports that Hon Hai, in fact, posted record quarterly profits, a significantly different story than leading analysts were predicting only a few weeks ago.

According to Bloomberg, fourth-quarter net income rose 5.6 percent to $1.2 billion. Thanks to finally working out production issues for the iPhone 5, the manufacturing company was able to increase revenue and margins.

As Foxconn’s revenue increased, Apple’s gross margins decreased. For three months. the iPad maker’s margin was at 38.6 percent, the lowest in two years. It is typical for Apple’s margins to fall when Hon Hai’s rises. Hon Hai’s gross margin grew to a three-year high of 9.58 percent in the fourth quarter.

Record sales of the iPhone 5 and the iPad mini, as well as the fourth-generation iPad, the 128GB iPad, and continued manufacturing of the iPad 2 helped secure earnings for Apple’s biggest parts supplier.

Rumors of a second-generation iPad mini and fifth-generation iPad, as well as a supposed low-cost iPhone are all on the table to keep Apple and Foxconn in business for a long, long time.

[Via: Apple Insider]

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About Lory: Writer of all things app related, traveler of the space-time continuum, baker of really great cookies. Follow me @appaholik