Foxconn Chairman Young Liu stated that the artificial intelligence boom “still has some time to go” as AI models are becoming increasingly intelligent with each new iteration that comes out. Liu said that progress toward so-called “AGI,” or Artificial General Intelligence, can only be a good thing for the AI server industry, which has been a key boon to Foxconn’s growth this year. Demand for Foxconn servers based on Nvidia’s upcoming Blackwell chip is “much better than we thought,” Liu said.
The boom in corporate investment into artificial intelligence infrastructure still has some way to go as large language models are continuing to evolve. Speaking with Emily Tan, Liu highlighted that advanced language models, like those from OpenAI, are becoming increasingly intelligent with each new iteration. He noted that the general movement in the tech industry today is trending toward a form of AI that is as intelligent — if not more intelligent — than humans, referred to as “AGI,” or Artificial General Intelligence.
“We’ve heard about AGI, and we’ll talk about different levels of intelligence. If you divide intelligence into four different levels, we’re at level two. There’s still level three and level four to go,” Liu said in an interview that aired Tuesday.
OpenAI, one of the leading companies pushing for AGI, raised $6.6 billion at a $157 billion valuation last week. The company is working toward releasing its next-generation LLM, GPT-5, although timing on the launch has not been shared. Liu emphasized that progress in AI can only benefit the AI server industry, which has significantly contributed to Foxconn’s growth this year.
“I think for the AI server industry, we still have some time to grow,” Liu added. “With AGI capability growing, the age of AI devices will be another industry we should watch carefully.”
Strong demand for Nvidia’s Blackwell chip underpins Foxconn’s recent success. The firm, known locally in China and Taiwan as Hon Hai, manufactures products including about two out of every three iPhones.
In the September quarter, Foxconn’s revenues reached 1.85 trillion Taiwanese dollars ($57.5 billion), up 20.2% year-over-year, surpassing company expectations.
ai-driven growth in server demand
This growth was driven by heightened demand for AI servers, which Foxconn manufactures for several major global tech giants.
The company is on track to ship servers based on Nvidia’s next-generation Blackwell GPU in the fourth quarter of 2024. Blackwell is also known as the GB200. Liu said demand for the chip is “much better than we thought,” and Foxconn is building new factories in Mexico to meet the high demand.
Nvidia CEO Jensen Huang has previously described demand for Blackwell as “insane,” noting that everyone wants to have the latest unit. Beyond producing IT infrastructure for cloud-based AI applications, Foxconn is also involved in new smartphone technology. The company is powering the new iPhone 16, which features the latest generative AI attributes.
Liu believes that “on-device” AI, where data is processed directly on the mobile device rather than on the cloud or server, represents the next substantial growth opportunity for the company. “I think genAI-related devices will be the next way to grow,” Liu said. “Currently, we’re seeing this on the cloud side with genAI cloud equipment booming.
But in the next phase, we will see the genAI devices. We have very high hopes for those devices.”
It’s noteworthy that Apple hasn’t yet released its AI system, Apple Intelligence, on the iPhone. The company is expected to release a beta version of Apple Intelligence later this fall as part of a new software update.
Smartphone makers are experiencing a “supercycle,” driven by the AI features in their new handsets. Smartphone sales have rebounded after several consecutive years of decline. In the second quarter of 2024, smartphone shipments climbed 6.5% year-over-year to 285.4 million units, marking their fourth straight quarter of growth.
Noah Nguyen is a multi-talented developer who brings a unique perspective to his craft. Initially a creative writing professor, he turned to Dev work for the ability to work remotely. He now lives in Seattle, spending time hiking and drinking craft beer with his fiancee.
