TLDRs;
- Foxconn’s Ingrasys leases a new facility in Taoyuan, boosting AI server output in Taiwan.
- The company expects AI server revenue to rise over 50 percent in 2025 to more than NT$1 trillion.
- Taiwan’s role in global AI infrastructure is expanding amid rising U.S. exports and local investment.
- Foxconn continues diversifying production globally with recent investments in Texas and California.
Foxconn’s strategic push into artificial intelligence hardware continues to accelerate as its subsidiary, Ingrasys Technology, expands its production footprint with a new facility in Taoyuan, Taiwan.
The move, part of a broader realignment of manufacturing priorities, signals the company’s growing focus on AI servers amid a global tech shift.
The newly leased site, located in the Farglory Free Trade Zone in Taoyuan’s Dayuan District, involves a NT$657 million (US$22.8 million) commitment over a 60-month lease. Ingrasys will occupy eight floors within the factory complex, reinforcing its AI server production lines already operating in Luzhu, Taoyuan, and Hukou in Hsinchu.
This latest expansion underlines Foxconn’s effort to recalibrate its business around high-performance computing, distancing itself from an overreliance on smartphone assembly. For years, Apple has contributed over half of Foxconn’s total revenue. But with smartphone demand flattening globally, the company is pivoting toward AI infrastructure, a sector it now views as critical to future growth.
Taiwan at the Core of AI Hardware Growth
The new investment places Taiwan squarely at the center of the global AI manufacturing boom. The country has experienced a surge in electronics exports, particularly those tied to data center and AI hardware. In 2024, Taiwan’s exports to the U.S. jumped by nearly 46 percent to over US$111 billion, largely driven by AI-related equipment.
In this environment, Ingrasys’ expanded presence in the free trade zone plays a dual role: supporting domestic industrial growth while feeding demand from major global clients, including U.S.-based hyperscalers.
This aligns with the broader trend of Taiwan becoming a crucial node in the AI supply chain, not only for chips but also for the servers that run large-scale AI models.
Foxconn’s AI Revenue Set to Soar
Foxconn expects its AI server revenue to grow by over 50 percent in 2025, potentially surpassing NT$1 trillion (around US$34.7 billion). That projection follows a significant uptick in broader sales performance.
In May alone, Foxconn reported revenues of NT$615.75 billion (US$20.6 billion), an 11.92 percent increase from the same period in 2024. Strong demand in cloud, networking, and computing sectors has helped the company build momentum through the first half of the year.
The AI pivot is not just about capitalizing on demand. It is also a necessary course correction. The company’s return on invested capital has dropped from 23 percent in 2016 to just 11 percent in 2023, pointing to declining profitability in its legacy assembly operations. Diversifying into AI server manufacturing offers a more scalable, future-focused path forward.
Global Footprint Supports Resilient Supply Chain
The Taoyuan expansion is just one piece of a larger global puzzle. In recent months, Foxconn has also committed US$142 million to building a facility in Houston, Texas, and has acquired another in Sunnyvale, California. Manufacturing hubs in Mexico and Vietnam round out its international footprint, part of a strategy to buffer against trade risks and maintain supply chain agility.
This distributed production model is increasingly vital as global trade policies evolve. U.S. tariffs on imported server products and rising geopolitical friction have pushed tech manufacturers to spread operations across multiple jurisdictions. Foxconn’s multi-site approach allows it to respond flexibly to shifting conditions while staying close to key markets.
