The largest producer of electronic components fears tariffs and lowers its forecasts

Foxconn, a top assembler of Apple iPhones and maker of Nvidia AI servers, has been riding the wave of AI demand but is also vulnerable to changes in U.S. trade and tariff policies because of its large manufacturing footprint in countries like China and Mexico.

Tariffs cause uncertainty for global electronics maker

Foxconn CEO Young Liu said during a financial results conference call that U.S. tariffs will bring more challenges, Reuters reported, and his full-year outlook was more cautious than before , after the company predicted a significant increase for 2025 compared with its previous forecast.

"Over the past month, the sharp changes in U.S. tariff policy have significantly affected the global supply chain. Recent currency fluctuations have increased uncertainty, so we are more cautious about the near term, " Liu said.

The United States and China have suspended mutual tariffs for 90 days.

Washington and Beijing on Monday agreed to lower each other’s tariffs for at least 90 days . Optimism over the temporary ceasefire was tempered by caution, given the need for a more permanent trade deal while higher tariffs could continue to weigh on the global economy.

Most of the iPhones Foxconn makes for Apple are assembled in China . Foxconn is also building a large manufacturing plant in Mexico — another target of U.S. President Donald Trump’s tariffs — for AI servers for Nvidia.

Nvidia said in April it would produce $500 billion worth of AI servers in the U.S. within four years, partnering with companies like TSMC and Foxconn in Houston.

In its earnings report, Foxconn said it should see significant year-over-year growth in the second quarter, with high double-digit year-over-year growth for AI servers and accelerating production volume growth.

The company’s net profit for the January-March period rose 91% year-on-year to $1.39 billion .

Foxconn shares have plunged 11.4% this year on U.S. trade concerns, compared with a 5.4% decline for the broader Taiwan index.