Exclusive: Apple Supplier Behind Supercomputer Donated To OpenAI Predicts AI Server Sales Tripling To $31B Next Year (CORRECTED)

Zinger Key Points
  • The ongoing Computex technology show in Taiwan has some of the biggest tech companies in the world in attendance.
  • Among them is Apple supplier Foxconn’s subsidiary, Ingrasys, and we caught up with them for an exclusive interview.

Editor’s Note: The article has been updated to note the correct designation of Foxconn’s Deputy spokesperson Jimmy Huang.

Apple Inc. supplier Hon Hai Technology Group (Foxconn) HNHPF is riding high on the boom in demand for artificial intelligence (AI) solutions.

The Foxconn official believes that its AI server revenue will surge more than three times in the next year. This comes amid Nvidia Corp. CEO Jensen Huang's prediction that data center spending will double to $2 trillion by 2029.

At the ongoing Computex technology trade show in Taiwan, Benzinga caught up with Foxconn’s Deputy spokesperson Jimmy Huang to understand what one of the leading cloud infrastructure providers in the world thinks of the AI opportunity.

For context, Foxconn’s subsidiary Ingrasys manufactured the DGX-1 supercomputer that Nvidia's Huang donated to OpenAI back in 2016. according to the official. It also donated the new DGX H200 GPU to the Microsoft Corp.-backed AI startup in April.

Are We In An AI Bubble?

The rapid rise of Nvidia over the past two years has led to concerns about an AI bubble. If there is one such bubble, Nvidia and other AI stocks could be adversely impacted.

However, Foxconn’s Huang thinks that this is "just the beginning."

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In fact, he points to an even more interesting facet of the company's prospects because of AI.

"Our chairman has just mentioned, maybe next year, our AI server revenue will reach NT$1 trillion (approx. $30.9 billion.)"

Huang added that the NT$1 trillion would be more than three times the existing revenue Foxconn makes from setting up AI servers for its clients.

Nvidia CEO Jensen Huang left a mark at the Ingrasys booth at Computex 2024 | Photo courtesy: Rounak Jain/Benzinga

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"In the traditional server market, we have NT$1 trillion and 30% of this is from AI servers." This puts Foxconn's existing revenue from AI servers at a little over $10 billion. The company expects this to surge to nearly $31 billion in the next year, an increase of over three times.

Is It Because Of Nvidia's GB200 Super Chip?

Nvidia's new AI super chip, GB200, has been the talk of the town since its announcement in March. It has analysts excited, too, who think it will drive the next wave of AI innovation.

Ingrasys Nvidia GB200 Blackwell at Computex | Photo courtesy: Rounak Jain/Benzinga

Is it also the secret behind Foxconn’s optimistic outlook? While Huang did not specifically point it out as a critical factor, he noted that different customers have different requirements for their data center needs.

He added that they do want to "just put more" power in their data centers, and GB200 packs a lot of punch.

Check out more of Benzinga’s Consumer Tech coverage by following this link.

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