Hon Hai Precision Industry Co., Ltd. (Foxconn), the world’s largest electronics manufacturer, confirmed on Wednesday it will announce details of a significant Foxconn OpenAI partnership next week. The tease came during a bullish third-quarter earnings call where the company revealed its AI server business is booming, with revenues from the sector now eclipsing its legacy smart consumer electronics business for the second consecutive quarter.
The announcement, delivered by Chairman Young Liu, signals a definitive strategic pivot for the Taiwanese giant, long known as the primary assembler of Apple’s iPhones. Foxconn is aggressively repositioning itself as the foundational hardware architect for the generative AI revolution, and a formal tie-up with the world’s leading AI research lab, OpenAI, would be the capstone of that transformation.
Key Facts: The AI Pivot Pays Off
- Massive AI Server Growth: Foxconn reported a staggering 300% quarter-over-quarter surge in AI server rack shipments in Q3 2025.
- Profit Beats Expectations: Q3 net profit jumped 17% year-on-year to T$57.67 billion (US$1.89 billion), crushing analyst consensus estimates (T$50.4 billion).
- Revenue Shift Confirmed: The Cloud and Networking division (including AI servers) accounted for 42% of total revenue, surpassing the Smart Consumer Electronics division (like iPhones) for the second straight quarter.
- Major New Investment: Foxconn’s board approved a NT$42 billion (US$1.37 billion) investment plan to build a new AI computing cluster and supercomputing center.
- The Big Tease: Chairman Young Liu confirmed an announcement related to OpenAI will be made at the annual Hon Hai Tech Day in Taipei on November 21-22, 2025.
The Announcement: A Pivot Solidified
During the company’s Q3 2025 earnings call on November 12, Foxconn Chairman Young Liu presented financial results that firmly establish the company’s new identity. While the tech world has been fixated on the software side of the AI boom—the large language models created by OpenAI, Google, and others—Foxconn has been quietly cornering the market on the hardware that powers them.
The company posted a 17% rise in net profit, a result fueled almost entirely by what Liu described as “sustained strength in demand for AI servers.
The most critical news, however, was forward-looking. Liu confirmed that an announcement detailing a collaboration with ChatGPT-creator OpenAI is slated for the company’s annual flagship event, the Hon Hai Tech Day, scheduled for November 21-22 in Taipei.
While Liu did not provide specific details, he framed the company’s AI ambitions in sweeping terms, directly countering market fears of a tech bubble reminiscent of the dot-com era.
This optimism is not unfounded. The company’s financial data provides a stark picture of a successful strategic realignment.
By the Numbers: Foxconn’s AI Gold Rush
For years, Foxconn’s fortunes were perceived as being inextricably linked to Apple’s iPhone sales. This created a high-volume but relatively low-margin business. The generative AI boom has changed that equation entirely. The servers required to train and run complex AI models are high-specification, high-margin products, and Foxconn is now Nvidia’s single largest server manufacturer.
AI Servers Officially Eclipse iPhones
The third-quarter results mark the second consecutive quarter in which Foxconn’s Cloud and Networking business—the division that builds AI servers for clients like Amazon, Microsoft, and Google—generated more revenue than its Smart Consumer Electronics division.
The numbers are dramatic:
- AI Server Rack Shipments: Grew by 300% in Q3 2025 compared to the previous quarter (Q2 2025).
- Revenue Contribution: The Cloud and Networking division now represents 42% of Foxconn’s total revenue, making it the largest single contributor to the company’s bottom line.
- Cumulative Revenue: Buoyed by this growth, Foxconn’s cumulative AI server revenue reached the “NT trillion-dollar scale” (approximately US$32.7 billion) ahead of schedule as of the end of September 2025.
Soaring Profits and Investor Confidence
This strategic shift from consumer gadgets to AI infrastructure has been rewarded by investors. The 17% jump in Q3 net profit to T$57.67 billion (US$1.89 billion) was significantly higher than the T$50.4 billion average forecast compiled by LSEG.
This performance has propelled Foxconn’s shares, which have surged 36% so far in 2025, far outperforming the broader Taiwan stock index’s 21% gain.
To fund this expansion, Foxconn’s board has approved a new capital expenditure plan of NT$42 billion (US$1.37 billion), earmarked for procuring equipment to build a state-of-the-art AI computing cluster and supercomputing center between December 2025 and December 2026.
Expert Analysis: From iPhone Assembler to AI Architect
The “what” of next week’s announcement is a partnership with OpenAI. The “why” is that Foxconn is solidifying its role as the primary builder of the “picks and shovels” for the AI gold rush.
An AI model like OpenAI’s GPT-5, or its video-generation model Sora, requires tens of thousands of specialized servers, networked together in massive data centers often called “AI factories.” Foxconn builds these.
A formal partnership suggests a deeper integration than simply being a supplier. Industry analysts widely speculate the announcement will formalize Foxconn’s role in building the infrastructure for OpenAI’s most ambitious—and secretive—projects.
The ‘Stargate’ Connection
Recent reporting has linked OpenAI CEO Sam Altman’s visits to Taiwan with a rumored supercomputer project codenamed “Stargate,” a reported Microsoft and OpenAI initiative that could cost upwards of $100 billion.
In October 2025, Altman reportedly met with Foxconn and TSMC (the world’s leading chipmaker) to discuss cooperation on Stargate, for which Foxconn is tipped to be the largest AI server supplier, particularly for data centers being built with Oracle
Furthermore, Foxconn has already established a partnership with Japan’s SoftBank to produce data center equipment at its former electric vehicle plant in Ohio, a move explicitly tied to the Stargate project.
Next week’s announcement at Hon Hai Tech Day is expected to move these discussions from reported talks to a formal, public-facing collaboration, likely involving multi-billion dollar, multi-year contracts to build the next generation of AI supercomputers.
Impact on the Global AI Supply Chain
A Foxconn-OpenAI alliance would have massive ripple effects:
- For OpenAI: It secures a manufacturing partner with the scale, speed, and supply chain expertise to build its massive, power-hungry AI factories faster than any competitor.
- For Foxconn: It cements the company’s identity as a high-tech AI infrastructure provider, further distancing it from its lower-margin assembly past and justifying its higher stock valuation.
- For Nvidia: As Foxconn is Nvidia’s top server maker, this partnership means a secured, massive pipeline of orders for Nvidia’s most advanced chips (like the Blackwell series) for years to come.
What to Watch Next
All eyes in the tech and financial worlds will be on Taipei for the Hon Hai Tech Day on November 21-22. The key questions that analysts hope to have answered are:
- What is the scale? Will the announcement be a specific, multi-billion dollar contract for a set number of server racks?
- Is it a Joint Venture? Will Foxconn and OpenAI announce a new, jointly-owned entity dedicated to building “AI factories”?
- Will ‘Stargate’ be named? Will the companies publicly confirm their involvement in the massive supercomputer project?
Whatever the specifics, the announcement has already validated Foxconn’s costly and difficult pivot. The company that built your iPhone is now building the brain of the global AI, and next week, it will officially cut the ribbon.
