Employees work at the mobile phone manufacturing plant of Rising Stars Mobile India Pvt., a division of Foxconn, in Tamil Nadu, India, on July 12, 2019.

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major an apple supplier Foxconn reported a 10% year-over-year decline in 2022 profit and forecast a decline in demand for consumer electronics for all of next year, the company said in its earnings report on Wednesday.

The negative sentiment reflects Apple’s subdued expectations for consumer sales. When Apple reported results for the first quarter of 2023, CFO Luca Maestri said the company expected a double-digit decline in Mac and iPad sales in the next March quarter compared to the previous year. The company added that iPhone sales in the March quarter will decrease less than in December.

Foxconn will continue to expand its presence outside of mainland China, and said that developing new markets was a key priority for the company in 2023. Earlier this year, Foxconn committed to significantly expand its presence in India.

Foxconn beat analysts’ estimates with full-year revenue of 511.85 billion yuan, compared with the consensus estimate of 493.95 billion yuan, but missed the bottom line with net income of 20.07 billion yuan, according to FactSet.

Taiwan-based Foxconn is a major manufacturer of consumer technology companies, but is best known for its relationship with Apple, which bets on Foxconn to manufacture and assemble the iPhone, among other products.

Foxconn’s iPhone manufacturing facility in Zhengzhou attracted attention in late 2022 after videos of Foxconn employees fleeing the factory amid strict quarantines went viral around the world. The Chinese government has since abandoned its most aggressive Covid protocols, but Apple and other big tech companies have stressed to suppliers the need to diversify outside of China.

Demand for electronics has fallen sharply as consumers grapple with the realities of a largely post-pandemic world. Global macroeconomic uncertainty has also weakened discretionary income, making it difficult for companies to continue the rapid growth many enjoyed from 2020 to late 2021.

An Apple representative declined to comment.

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