Taiwan’s Foxconn, a major iPhone assembler for Apple Inc (AAPL.O), said on Wednesday that second-quarter revenue dropped 14% year-on-year, but the outlook for the third quarter was brighter ahead of the peak shopping season at the end of the year.
The world’s largest contract electronics maker, formally called Hon Hai Precision Industry Co Ltd and known globally as Foxconn, said revenue in the April-June period reached T$1.3 trillion ($41.76 billion), in line with its expectations. The company mainly produces upstream components such as electronic connectors, industrial robots, and smartphone metal casings. It also manufactures and sells consumer electronics, communications, and computer products.
Foxconn, which employs more than a million people across its plants in China and elsewhere, has come under criticism for the way it treats workers. 2010 Steve Jobs defended his relationship with the company, saying it was “pretty nice.” In 2021, however, universities in Hong Kong, Taiwan, and mainland China jointly published a report on the company’s factories, describing them as labor camps and detailing alleged abuse, including long hours and excessive overtime.
The same year, a spate of worker suicides and other incidents prompted President Xi Jinping to order a significant review of the company’s operations and the treatment of its employees. The review led to over a dozen changes, including increased pay and a ban on sending workers home for breaks or sick days.
But the reviews need to do more to appease activists. This week, Foxconn’s major US customer, Apple, said it would take a closer look at the company’s factories’ conditions and work with Foxconn to make improvements.
In announcing the new guidelines, Apple said it would work with Foxconn to increase transparency around its supply chain’s wages and working conditions. It will also push for more independent verification of labor practices. It said that while it was “not a panacea,” the new measures would help address some of the challenges faced by suppliers.
Apple has been under pressure from shareholders to make a more significant effort to promote ethical and environmental practices at its supplier companies. Some investors have argued that it should set a higher minimum wage and improve working conditions in countries like China, where many suppliers are located. However, UNSW Business School’s Maggie Dong says it is up to prominent players like Apple to set the standard.
