Global chip stocks climb on Foxconn results, AI server demand

Global semiconductor stocks rose on Monday after the electronics giant contracted Foxconn announced record fourth quarter earningssuggesting that the artificial intelligence boom has much more room to run.

Hon Hai Precision Industry, which does business as Foxconn internationally, said on Sunday statement that the company’s fourth-quarter revenue was 2.1 trillion New Taiwan dollars ($63.9 billion), up 15% year-on-year.

Foxconn – which is a supplier of Apple – also set a record, posting the highest fourth-quarter revenue in the company’s history, according to the statement.

The company’s revenue performance was driven by growth in its cloud and networking products — which include AI servers like those designed by the likes of the chipmaker. Nvidia – and components and other product segments.

Computer products and smart consumer electronics — which numbers the iPhone and other smartphones — saw “slight declines,” Foxconn said.

Shares of many semiconductor companies in Asia, Europe and the United States rose as a result.

In Asia, Taiwan Semiconductor Manufacturing Co. hit a record high on Monday and closed up 1.9% in Taiwan.

The world’s largest semiconductor manufacturer, TSMC makes chips for tastes Advanced Micro Devices and Nvidia.

Other Asian chip firms also recorded share price gains – South Korea’s SK Hynix and Samsung rose nearly 10% and 4%, respectively.

In Europe, global critical semiconductor equipment firm ASML saw its shares jump nearly 6%, while shares of Dutch chip company ASMI rose nearly 5%. Germany’s Infineon rose more than 6%.

Paris-listed shares of European chipmaker STMicroelectronics rose nearly 6%.

In the United States, Nvidia got a boost from Foxconn’s numbers, climbing 2% in US premarket trading.

On Monday, the chip stock was again from Microsoft announcement at the end of last week approx plans to invest $80 billion by 2025 in data centers that can handle AI workloads.

Microsoft is one of several tech giants splurging on GPUs, or graphics processing units, from Nvidia to train and run the most advanced AI models.

AMD, Nvidia’s closest rival, rose 3% in premarket trading on Monday, while US chip companies. Qualcomm and Broadcom both rose almost 2%.