Foxconn Eyes ‘High Double-Digit’ AI Server Growth; Focus on Production Capacity

Taiwan’s Foxconn is anticipating its AI server rack shipments to grow at a “high double-digit” pace in the first quarter and potentially double for the full year 2026, signalling a sharp acceleration in artificial intelligence (AI) expansion for the world’s largest contract electronics maker.

According to a report by Focus Taiwan, Foxconn Chairman Young Liu said the company’s broader AI portfolio is likely to gain further market traction this year, building on an already strong base. Foxconn currently accounts for nearly 40% of the global AI server market, underscoring its dominant position in the fast-growing segment.

Liu added that demand for AI servers has remained resilient despite global headwinds such as currency volatility, trade and tariff uncertainties, and escalating geopolitical tensions. The sustained demand highlights the critical role AI infrastructure is playing for cloud service providers and enterprises globally.

A notable shift is also visible in Foxconn’s revenue mix. In 2025, its cloud and networking division contributed around 40% of total sales, surpassing the smart consumer electronics segment, which accounted for 38%, for the first time. The computing division made up 15% of revenue, while electronic components and other businesses contributed the remaining 7%. This transition reflects Foxconn’s strategic pivot toward higher-growth, enterprise-focused segments.

Looking ahead, the company’s next phase of AI expansion is centred on ramping up production capacity, particularly in the United States. Foxconn’s largest AI server manufacturing facility in the US is expected to produce nearly 2,000 server racks per week in 2026 to meet rising demand.

The localisation of production also aligns with the company’s broader strategy to diversify supply chains amid growing geopolitical risks and trade uncertainties.

Financially, Foxconn reported strong performance in 2025, with net profit rising 24% year-on-year to $5.92 billion. Consolidated revenue increased 18% to $252.54 billion, driven by growth in its cloud and networking as well as smart consumer electronics segments.

Separately, the company’s board approved a cash dividend of $0.23 per share for 2025, marking its highest payout since listing in 1991. The payout ratio stood at 52.9%, reflecting strong earnings and confidence in future growth, particularly in AI-driven businesses.