Industrial Fulian Reports Revenue Surge to 266.1 Billion Yuan in H1 2023, Fueled by Strong Demand for AI Servers

Industrial Fulian (Foxconn Industrial Internet), has experienced a significant surge in revenue and net profit for the first half of 2024, achieving record highs since its initial public offering. On August 4th, the company reported a revenue of CNY 266.09 billion, marking a year-on-year increase of 28.69%. The net profit attributable to shareholders reached CNY 8.739 billion, reflecting a 22.04% growth.

The robust demand for AI servers has been a key driver behind this performance. Industrial Fulian's vertically integrated capabilities across the entire AI industry chain have propelled the remarkable growth of its cloud computing segment, with AI server product revenue seeing exponential increases. The rising revenue share from cloud service providers has further enhanced the company's overall revenue and profitability.

Capitalizing on the opportunities presented by the digital economy and AI advancements, Industrial Fulian continues to leverage cutting-edge technology and optimized capacity planning. This strategic focus has allowed the company to achieve a significant competitive edge in cloud computing and network communications.

Looking ahead, Industrial Fulian plans to further develop the AI ecosystem and enhance its global production capacity. The company aims to increase its research and development investments to better address customer needs in new product development, rapid mass production, and global delivery. Key areas of focus include GPU modules, substrates, and the design and system integration of AI servers, enabling the provision of comprehensive solutions through smart manufacturing and research capabilities across the entire industry chain.

As a leading A-share stock in the computing sector and a key player for Apple, Industrial Fulian has built a strong partnership with NVIDIA in the cloud computing arena, launching AI servers in collaboration and co-developing AI factories. In terms of mobile components, the company supplies major consumer electronics brands, including Apple.

In recent investor relations updates, Industrial Fulian attributed its performance to the thriving AI industry, which has significantly increased the demand for AI servers. The proportion of AI contributions to overall cloud computing revenue has also grown, improving the company’s product mix. In 2023, AI-related business volume neared CNY 60 billion, approximately 30% of total cloud computing revenue, up from 20% in 2022. Projections for 2024 indicate that AI could contribute to 40% of the company’s cloud computing revenue, with AI servers capturing a 40% share of the global market.

Additionally, at the end of July, Industrial Fulian announced a substantial share buyback plan. On July 30, the company declared an intention to repurchase shares using its own funds, aimed at a price not exceeding CNY 40.33 per share, with a total buyback amount ranging between CNY 200 million and CNY 300 million. These repurchased shares will be retired to reduce the company's registered capital and the buyback will occur within 12 months following shareholder approval. The announcement indicated that based on the buyback parameters, approximately 7.44 million shares, or about 0.04% of total shares, could be acquired at the upper limit, while at the lower limit, around 4.96 million shares, or approximately 0.02%, could be purchased. This buyback initiative reflects Industrial Fulian's confidence in its future growth prospects and long-term value, aimed at protecting shareholder interests and bolstering investor confidence while considering the company’s financial condition and future profitability.