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Foxconn’s FIH Mobile warns of US$110m interim net loss over costs of Nokia handset deal

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FIH Mobile agreed in May last year to buy Nokia’s old feature phone business. Photo: AFP

Foxconn subsidiary FIH Mobile, the top contract manufacturer of smartphones for Xiaomi, expects to record a net loss of about US$110 million for the six months to June 30, as the company is weighed down by its acquisition of Nokia’s old feature phone business.

The profit warning comes about three months after FIH Mobile and Finnish company HMD Global completed their US$350 million purchase of the Nokia assets from Microsoft.

In a regulatory filing after the market closed on Monday, FIH Mobile’s acting chairman Chih Yu Yang said the estimated loss would mark a 628 per cent decline from the company’s US$20.8 million interim net profit last year.

Chih attributed that substantial decline to “costs relating to a new business group within the company under a collaboration agreement announced on 18 May 2016”.

He pointed out, however, that FIH Mobile’s interim revenue this year is forecast to rise 99 per cent to US$4.6 billion, up from US$2.3 billion in the same period last year.

FIH Mobile is a subsidiary of Taiwan-listed Hon Hai Precision Industry, the world’s largest contract electronics manufacturer, known widely under its trade name of Foxconn.

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