Apple, Hon Hai in discussions to build AI servers – Taipei Times

• By Chen Cheng-hui /
  Staff reporter

Apple Inc has approached its biggest iPhone supplier, Hon Hai Precision Industry Co (鴻海精密), also known as Foxconn Technology Group (富士康科技集團) internationally, about building artificial intelligence (AI) servers in Taiwan, the Nikkei Asia reported on Tuesday, citing sources familiar with the matter.

The servers are intended for Apple’s internal use to help it ramp up its computing capability, so the size of the order would likely be relatively small, the report said.

In addition, Hon Hai’s capacity to take on Apple as a server customer might be limited, as the Taiwanese firm is also the leading manufacturer of Nvidia Corp’s AI servers, it said.

Late last month, Apple rolled out its first set of Apple Intelligence features across its premium iPhone, iPad and Mac devices after revealing its AI capability at the company’s developers conference in June.

To allow more consumers to embrace the company’s generative AI features, Apple needs to rely on its manufacturing partners to build the necessary hardware for this goal.

While Apple and Hon Hai have entered into discussions, no agreement has been finalized yet, the report said.

Apart from Hon Hai, Apple has also approached Chinese firm Lenovo Group Ltd (聯想), the world’s largest PC maker, and its subsidiary, LCFC (Hefei) Electronics Technology Co (聯寶科技), to help in designing some of the AI servers, the Nikkei Asia reported.

There is a possibility that more players might enter Apple’s supply chain for this server production plan, as the US tech giant is looking to smaller suppliers, such as Universal Scientific Industrial Co (環旭電子), to provide additional production capacity, the report said.

Still, nothing is set in stone right now, it added.