Apple supplier and lead iPhone assembler Foxconn on Friday reported a revenue drop for the final quarter of 2023 and said it expects a year-over-year decline in sales for its first quarter of 2024.
Foxconn revenue for the last three months of the year totaled NT $1.85 trillion ($59.7 billion), a 5.4% dip from the year-ago period. Foxconn attributed the decrease to weak or flat sales in its computing products, smart consumer electronics products and cloud and networking products. The company’s December revenue also fell 27% year over year.
The outlook follows two downgrades to Apple stock earlier this week. Both firms pointed to softening iPhone sales.
“We are still picking up weakness on iPhone volumes and mix, as well as a lack of bounce-back in Macs, iPads and wearables,” Barclays analysts wrote in a note to investors Tuesday.
“The biggest takeaway from the latest checks is incrementally worse IP15 data points out of China, together with developed markets remaining soft,” the note said, referring to the iPhone 15. The downgrade put a drag on shares of Foxconn and other Apple suppliers such as Taiwan Semiconductor Manufacturing Company on Tuesday.
Piper Sandler issued its downgrade Thursday. “We are concerned about handset inventories entering into 1H24 and also feel that growth rates have peaked for unit sales,” Piper Sandler’s Harsh Kumar wrote, noting that he expects a recovery in the handset market sometime during the second half of 2024.
Shares of Apple are down about 5% since the start of the year.