Apple Inc.'s AAPL key supplier Foxconn, also known as Hon Hai Precision Industry Co., Ltd HNHAF is reportedly facing obstacles in expanding its operations in India as China tightens restrictions on technology and talent exports.
What Happened: Chinese authorities have made it more difficult for engineers and key manufacturing equipment to leave the country, reported the Financial Times, citing industry sources and ministry notices.
Last month, Foxconn reported that its fourth-quarter earnings increased by 15.17% compared to the previous year and by 15.03% from the previous quarter, reaching a record NT$2,132.3 billion, or approximately $64.83 billion.
Earlier this month, Hon Hai reported a 3.16% year-over-year increase in January 2025 revenue and also upgraded its forecast for the first quarter.
Analysts suggest that Beijing’s strategy mirrors the Western tech transfer restrictions it has criticized. The informal controls seem to target India, while projects in Southeast Asia and the Middle East remain largely unaffected, the report noted.
China’s commerce ministry has also proposed new export restrictions on technologies related to lithium extraction and advanced battery materials.
Why It Matters: These restrictions are part of China's broader strategy to retain critical technologies, particularly in semiconductor and battery production, as it counters tariffs from the Donald Trump administration and trade disputes with the EU.
Earlier this month, China announced new tariffs of up to 15% on certain U.S. imports in retaliation for a 10% levy imposed by the U.S. on Chinese goods.
"China is building up a large export control muscle and being quite deliberate in what they choose to control," senior analyst Antonia Hmaidi told the publication. "Fundamentally it's about keeping China central to global supply chains," she said.
Price Action: Apple’s stock rose by 0.02% to $244.65 in after-hours trading, building on a 1.27% gain that brought it to $244.60 at Friday’s market close, according to Benzinga Pro.
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