Hon Hai Q3 profits jump with holidays; analysts optimistic on Q4

Hon Hai Precision Industry Co. (TW-2317) reported its third-quarter earnings Wednesday evening, showing third quarter sales of NT$919 billion (US$31 billion), up 2.6% from the second quarter. Net profit jumped 81.6 percent to NT$30.8 billion from last quarter and up 1.64% from the same period of the prior year, beating the average of 13 analysts' estimates compiled by Bloomberg. Earnings per share stood at NT$2.34 for the quarter.

Operating profit rose to NT$31.8 million during the period, up 1.38 percent year-on-year, while sales for the first 3 quarters were a combined NT$2.6 trillion, down 5.19% on a yearly basis.

Hon Hai shares rose more than 1 percent to NT$75.7 at 12:07 a.m. in Taipei trading on Thursday.

New devices including the latest ranges of iPhone and preparation for the latest iPad contributed to the growth in revenue from the previous quarter, according to analysts. Hon Hai's November income is also expect to climb as it prepares for the upcoming Thanksgiving and Christmas holiday season in the U.S. and European markets.

J.P. Morgan analyst Gokul Hariharan forecasts that operating margins in the second half will be helped by the introduction of new products, with increasing orders for touch screens camera modules and shells from Apple and adjusted product research and development expenses from the first half of the year.