Foxconn finally hits 8-year stock target set out by billionaire founder Terry Gou

‘The AI wave lifts all boats,’ says one analyst, as shares of Hon Hai Precision Industry reach NT$200

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Foxconn Technology Group founder Terry Gou Tai-ming. Photo: AFP

Published: 12:07pm, 18 Jun 2024Updated: 1:45pm, 19 Jun 2024

Terry Gou Tai-ming, the billionaire founder of iPhone assembler Foxconn Technology Group, has finally reached a goal that had eluded him for about eight years.

Shares of the group, formally known as Hon Hai Precision Industry, closed on Monday at NT$200 (US$6.18), a level Gou had pledged to achieve in 2016. The Taipei-listed stock has surged more than 90 per cent this year on investor enthusiasm for artificial intelligence (AI) servers and potential for the latest Apple products.

While Gou stepped down as Foxconn chairman in 2019 when he unsuccessfully pursued Taiwan’s presidency, the price level represents a landmark for the company he started 50 years ago.

Annual general meetings (AGMs) in past years had featured shareholders asking Gou when his famous target would be attained. This year’s AGM showed how the company has evolved in new fields including AI servers, which it expects to become its next NT$1-trillion business, and electric vehicles.

The strong performance this year of Foxconn and Taiwanese tech peers, including Quanta Computer, also underscores the transformation of the island’s electronics contract manufacturers from low-margin, commodity information technology products to higher value-added offerings.

“The AI wave lifts all boats,” said Xiadong Bao, a fund manager at Edmond de Rothschild Asset Management. For Foxconn, “the rally is mainly driven by the AI server ramp-up, further expansion into AI-related networking equipment and high expectations for a general server and PC recovery”.