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CNBC
30-07-2025
- Automotive
- CNBC
iPhone maker Foxconn joins $1 trillion AI data center market with new alliance
Foxconn on Wednesday said it is taking a stake in TECO Electric & Machinery Co., a move that will looks to supercharge its efforts to become a key player in building artificial intelligence data centers. The Taiwanese firm, formally known as Hon Hai, is looking to replicate the success it has had in consumer electronics in the world of AI. It's a play that could unlock Foxconn's access to a potential $1 trillion of spending by companies on data centers in the coming years, according to Counterpoint Research, and will also pit the Taiwanese giant against companies like ABB, Siemens and Mitsubishi Electric. Foxconn will take a 10% stake in TECO as the result of a share exchange. TECO started life as a engine maker for cars but has since extended into areas such as electric vehicles, energy storage and data center construction. Foxconn meanwhile, which assembles Apple's iPhone and is a key partner for Nvidia, manufactures server racks designed for AI workloads. The two companies are now teaming up to bring their expertise together to effectively create a one-stop-shop for anyone looking to set up an AI data center. "The strategic partnership extends the two companies' cooperation in the fields of low-carbon smart factories and energy services, toward being a one-stop solution for data centers going forward," TECO Chairman Morris Li said. The assembly of AI servers has become a key focus as Foxconn looks to diversify its revenue beyond the manufacturing of consumer electronics. AI server revenue is expected to have doubled in the second quarter of the year, Foxconn previously forecast. The company has also shown its willingness to expand into new areas including the assembly of electric vehicles and even manufacturing of semiconductors. "With the AI infrastructure boom, Hon Hai with [a] strategic alliance with TECO aims to extend and tightly integrate the server components and racks value chain from co-design, manufacturing to engineering and infrastructure construction services," Neil Shah, partner at Counterpoint Research, told CNBC. "Hon Hai aims to become a one-stop shop for all the datacenter needs." Tech giants from Microsoft to Google have already laid out plans to spend billions of dollars this year alone on data centers, which includes chips and servers — a market that Foxconn is targeting. Foxconn and TECO said they are targeting business in Taiwan and other parts of Asia, as well as the Middle East and the U.S. The two companies pointed to their footprint in the U.S. and said they plan to "expand American manufacturing and reshape the global supply chain." "The full data center solutions will give strong impetus to Foxconn's business as it takes to take a bigger slice of the overall data center CAPEX (capital expenditure) which includes servers to physical infrastructure," Counterpoint Research's Shah said.
Malaysian Reserve
30-07-2025
- Business
- Malaysian Reserve
TECO Electric & Machinery and Hon Hai Technology Group Announce Strategic Alliance Targeting AI Data Center Capabilities
TAIPEI, July 30, 2025 /PRNewswire/ — TECO Electric & Machinery Co Ltd ('TECO') (TWSE:1504) and Hon Hai Technology Group ('Foxconn') (TWSE:2317) held a major press conference today (30th) at the Taiwan Stock Exchange to announce a strategic alliance through a board-approved share exchange. This partnership combines TECO's strengths in electromechanical systems with Foxconn's expertise in ICT to seize the global trend of AI data center development toward standardization and modularization, jointly tapping into vast AI data center (AIDC) business opportunities worldwide. Going forward, the strategic alliance will explore the possibility of expanding cooperation in Foxconn's '3+3+3' areas. According to terms approved by both boards, respectively, TECO will take a 0.519% stake in Foxconn. In turn, Foxconn will own 10% in TECO. The latter will issue 237,644,068 new shares to Foxconn, and Foxconn will issue 72,481,441 new shares to TECO, implying a share exchange ratio of approx. 1 to 0.305. The no-cash transaction is targeted to complete in the fourth quarter of this year, conditional on regulatory approvals. Since a data center is mainly composed of equipment inside the computer room (servers, cooling systems, UPS, etc.) and power infrastructure outside the computer room, the strategic alliance integrates the combined strengths each bring in their respective fields of AI servers, electromechanics, and information and communications. Target markets cover Taiwan and Asia, as well as the Middle East and the US. TECO Chairman Morris Li said, 'Changing global dynamics are creating new opportunities for business and cooperation. The strategic partnership extends the two companies' cooperation in the fields of low-carbon smart factories and energy services, toward being a one-stop solution for data centers going forward. Texas-based TECO-Westinghouse, a longstanding world leader in manufacturing electric motors, has the advantages of American manufacturing and local services. Together with Foxconn's manufacturing base in the United States, it is in line with the strategic direction of the two companies to expand American manufacturing and reshape the global supply chain.' Foxconn Chairman Young Liu said, 'Time-to-market is key in the global super-computing race. Modular design is gaining popularity. As AI data centers grow in size and demand ramps higher, teaming up with TECO means both companies are able to level up and rapidly deliver comprehensive, vertically-integrated solutions to our customers – the Tier-1 CSPs and hyperscalers.' About TECO: to learn more, visit About Foxconn: to learn more, visit Photo – View original content:
Associated Press
22-05-2025
- Business
- Associated Press
TECO Named in S&P Sustainability Yearbook for 5th Time, Ranks in Global Top 1%
TAIPEI, May 22, 2025 /PRNewswire/ -- The S&P Global Sustainability Yearbook Awards Ceremony was held today (22nd) in Taipei to honor companies listed in the 2025 edition of the Yearbook. TECO Electric & Machinery Co., Ltd. (TWSE: 1504) was named to the Yearbook for the fifth consecutive year by global index and ratings agency S&P Global. TECO also earned the distinction of being ranked among the top 1% of sustainable companies worldwide, one of only 11 companies from Taiwan to receive this recognition. TECO Chairman Mr. Morris Li stated that sustainability is at the core of TECO's strategy through green innovation. The company's consistent inclusion in international sustainability rankings highlights its leadership in ESG practices. Looking ahead, TECO will continue to focus on electrification, intelligence, and green energy, working with global partners to build a resilient and sustainable industrial ecosystem. This is the first time the S&P Global awards ceremony was held in Taiwan. The trophy was presented by Robert Dornau, Head of Corporate Engagement, S&P Global Sustainable1, recognizing companies for their outstanding contributions to sustainability. TECO was represented by Director of the ESG Office, Mr. Ang-Ting Shih. The Sustainability Yearbook rankings are based on ESG scores generated through the Corporate Sustainability Assessment (CSA), which is also used in the Dow Jones Best-in-Class Indices. The assessment evaluates a company's sustainability performance across environmental, social, and governance dimensions. In addition to the Yearbook honor, TECO has also been selected for the Dow Jones Emerging Markets Best-in-Class Index for five consecutive years and has consistently ranked first in ESG performance among electromechanical companies in emerging markets, further underscoring its leadership in global sustainability. TECO has actively embedded sustainability into its core operations, extending its practices from Taiwan across its global businesses. The company has set a goal to achieve net-zero emissions across the group by 2050. In recent years, TECO has made continuous progress in reducing factory emissions and developing renewable energy infrastructure. In 2024, it completed 5.3 MW of new solar installations in the United States and China, bringing its global total to 15.046 MW. The company is on track to meet the goal of increasing renewable energy generation capacity to as much as 30% of total electricity consumption by 2030. Additionally, TECO has implemented an internal carbon pricing mechanism at NT$1,600(approximately USD53) per ton of CO₂ and established an internal carbon fund to support low-carbon innovation and R&D. Revenue from low-carbon products now accounts for 73.8% of its total product revenue. On the social responsibility front, TECO upholds the philosophy of shared value with stakeholders. Through the TECO Technology Foundation, the company actively promotes education, talent development, and social welfare. TECO's annual 'Net Zero Tech International Contest' draws nearly 1,000 participants from around the world, further amplifying the company's global influence in sustainability. S&P Global emphasized that companies in the electrical components and equipment industry provide innovative solutions for improving industries efficiency in manufacturing and process. The industry plays a vital role in the global transition to clean energy and in modernizing energy infrastructure. In response, TECO has aligned its business with the 'B2B2S' model-Business to Business to Sustainability-deeply integrating ESG strategies across its operations, extending to customers and suppliers, and building a low-carbon value chain. The company is committed to advancing a broader societal shift toward sustainability and accelerating the transition to a net-zero future. View original content to download multimedia: SOURCE TECO Electric & Machinery Co.
