TLDR
- Nvidia stock rose 1.6% in premarket trading Wednesday after Foxconn reported strong AI hardware demand
- Foxconn’s cloud and networking products, including AI servers, now represent 42% of total revenue, making it the company’s largest business segment
- Foxconn reported cumulative AI server revenue of 1 trillion New Taiwan dollars ($32.2 billion) through the end of September
- The news comes days before Nvidia’s earnings report on November 19, following Tuesday’s 3% drop after SoftBank disclosed a $5.8 billion stake sale
- AMD stock jumped 5.3% after projecting annual revenue growth above 35% over the next three to five years from AI processor demand
Nvidia shares climbed 1.6% in premarket trading Wednesday to $196.24. The move came after Foxconn Technology Group reported strong demand for artificial intelligence hardware.
The gains reversed some of Tuesday’s losses. Nvidia fell 3% the previous day after SoftBank Group disclosed it had sold a $5.83 billion stake in the chipmaker.
The timing matters for Nvidia investors. The company reports quarterly earnings on November 19, just one week away.
Foxconn’s AI Business Takes Center Stage
Foxconn delivered better-than-expected third quarter net profit Wednesday. The Taiwan-based manufacturer shared key details about its AI server business.
Cloud and networking products now account for 42% of Foxconn’s total revenue. This segment includes AI servers that house Nvidia’s chips.
The business line has become Foxconn’s largest revenue source. It surpassed smart consumer electronics for the second consecutive quarter.
Foxconn’s cumulative AI server revenue hit 1 trillion New Taiwan dollars by the end of September. That equals roughly $32.2 billion.
The company is best known as Apple’s primary iPhone manufacturer. But its AI infrastructure business keeps expanding.
Nvidia and Foxconn work together on several projects. The partnership helps expand production capacity for AI hardware.
Global demand for systems that train and run large AI models drives this growth. These systems rely heavily on Nvidia’s graphics processing units.
Data Center Business Drives Growth
Nvidia’s data center segment has become its largest revenue source. The business has powered record growth over the past year.
Investors will watch the November 19 earnings report closely. They want confirmation that AI server shipments remain strong.
Some analysts warn about cooling momentum in consumer GPU sales. But reports from manufacturing partners like Foxconn suggest the AI cycle continues.
The order pipeline appears to remain healthy. This comes despite recent volatility in Nvidia’s share price.
Advanced Micro Devices also gained Wednesday. AMD stock rose more than 5% on the day.
AMD projected annual revenue growth above 35% for the next three to five years. The company expects demand for its AI processors to drive this expansion.
Foxconn’s results provide a window into hardware demand trends. The manufacturer’s growth in AI server revenue reached 1 trillion New Taiwan dollars as of September’s end.
The post Nvidia (NVDA) Stock Gains After Foxconn Reports Strong AI Server Demand appeared first on Blockonomi.
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This articles is written by : Nermeen Nabil Khear Abdelmalak
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