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To blame, and to thank.

Apple’s main iPhone producer posted its first drop in sales in 26 years

Mike Murphy
By Mike Murphy

Technology editor

There’s good news and bad news for Foxconn, the largest producer of iPhones in the word. Hon Hai Precision Industry, Foxconn’s owner, announced its first drop in yearly sales since 1991, which it attributes to a fall in the global demand for the iPhone, according to The Wall Street Journal (paywall).

Apple recently broke a slide of three consecutive quarters of falling iPhone sales (likely due to the iPhone’s design starting to feel very tired) with its best-ever quarter for iPhone sales. But as the Journal points out, the company elected to spread out its manufacturing duties across its suppliers more than it had in the past, meaning Hon Hai did not see quite the same spike in sales as Apple.

But the good news was that Foxconn still managed to post a modest gain in profit, with its net income up 1.2% in 2016 to NT$148.7 billion, which analysts are attributing to strong demand for the iPhone 7 Plus, according to CNBC.

It’s entirely possible that 2017 will be a brighter year for Foxconn than last year, as analysts are predicting a “supercycle” for Apple products released in the year, with a complete overhaul of the iPhone later in the year, as well as new iPad models, and potentially new computers. That’s assuming, however, Apple doesn’t continue to spread around business to other suppliers.

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