Foxconn, Pegatron Foresee Weak Q2

Foxconn Electronics and Pegatron both reported strong first quarter results but cautioned that the second quarter would be weaker before sales rebound in the second half of the year.

Foxconn’s Q1 net profit jumped 55.5% year on year to NT$30.4 billion ($999.1 million), the highest profit for the January-March quarter in the company’s history, while turnover in the first three months reached NT$1.1 trillion ($36.1 billion). Pegatron’s net profit was NT$7.2 billion ($236.6 million) on turnover of NT$274.2 billion ($9 billion).

With demand for Apple’s iPhone 6 and 6 Plus reaching saturation point, both companies are expected to see sales weaken in Q2, marking the lowest quarter for 2015. Apple is expected to launch new smartphones in the second half of the year, which will benefit both Foxconn and Pegatron, though some industry watchers suggest that Foxconn could lose orders to Peqatron.