With growth slowing due to growing inflation, cooling demand, and escalating supply chain challenges, in part due to lockdowns in China, Apple supplier Foxconn (2317.TW) warned that sales for its electronics sector, including smartphones, could fall in the current quarter. The world’s largest contract electronics manufacturer, based in Taiwan, has experienced difficulties with smartphone production due to a worldwide scarcity of processors, a problem that has affected Apple, the company’s most important client.

COVID-19 limitations in China had a minimal effect on production, the company said, because it kept employees on-site in a “closed loop” system, but demand for its products has decreased as people remain confined to their homes. High prices and the conflict in Ukraine have contributed to a recent fall in key markets, which has compounded the slowdown.

With slightly more than half of its sales coming from smartphones and consumer electronics, Foxconn knows it needs to diversify its business into other areas, including as electric vehicle (EV) manufacturing, which it estimates could be worth $34 billion by 2025.

Foxconn Chairman Liu Young-way said on a post-earnings call, “There are numerous uncertainties in the market at the moment.” He cited the pandemic, geopolitical threats, and inflation as some of the year’s biggest concerns.

The imbalance between supply and demand is complicated by them, as Liu put it.

He explained that the expected sales drop in consumer electronics for the second quarter was attributable to a greater base last year and the delay in launching new products until later this year.According to Liu, the company’s impact has been minimal so far because most of its items are higher end, but inflation is hurting demand for lower-end consumer devices.

Inflation’s effect on middle- and upper-tier goods is something the company is keeping a close eye on, he said.

Formerly known as Hon Hai Precision Industrial Co., Ltd., the company anticipates a flat quarterly and annual revenue performance. It did not give a monetary forecast, but it did anticipate robust expansion across its component, computing product, cloud and networking product lines.

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fcc tmobile cdma boost mobilefriedaxios Dish Network sent a letter to the FCC on Thursday, complaining that T-Mobile — its partner for wireless services — is rushing to shut down a network still used by millions of Dish’s Boost Mobile customers.

Why it matters: T-Mobile’s purchase of Sprint was only allowed after it agreed to sell a chunk of assets to Dish, including its Boost prepaid business. Plus, Dish is highly reliant on T-Mobile for network services as it builds out its own 5G network over the next several years.

Driving the news: Dish’s letter to the FCC addresses a range of concerns, but the largest issue relates to the shutdown of the CDMA network that had previously been used by Sprint and is still used by the majority of Dish’s 9 million Boost Mobile subscribers.

As part of the Boost sale to Dish, T-Mobile agreed to provide network services, but didn’t commit to operating the CDMA service (Sprint’s legacy network) for a particular length of time.
Dish had expected that T-Mobile would eventually look to shut down that network in three to five years, according to people familiar with Dish’s thinking. But Sprint said late last year that it would look to shut it down far earlier, on Jan. 1, 2022.
What they’re saying: “A forced migration of this scale under this accelerated time frame is simply not possible and will leave potentially millions of Boost subscribers disenfranchised and without cell service come January 1, 2022,” Dish said in the letter.

It also noted that Verizon, which has only 1% of customers still on CDMA, has repeatedly delayed its shutdown and now doesn’t plan to do so until 2023, a year after T-Mobile plans to do so.
A T-Mobile representative was not immediately available for comment.
Between the lines: The public acrimony is significant as Dish is highly reliant on T-Mobile for network services over the next several years while it builds out its own 5G network. (Dish expects to launch its first city with its own 5G service this year, but the national roll-out will take time.)

Our thought bubble: Given Dish’s reliance on T-Mobile, it’s reasonable to think that a public spat was not its first course of action, and that Dish has gone to regulators only after failing to convince T-Mobile to change its timing on the network shutdown.

Meanwhile: In the letter, Dish also accuses T-Mobile of flip-flopping on other spectrum issues. Where T-Mobile previously pushed for policies encouraging smaller competitors, Dish says T-Mobile is now adopting the same tactics as AT&T and Verizon.

“During its earlier life as the ‘Un-Carrier,’ T-Mobile championed policies that promoted competition, diverse spectrum ownership, and efficient spectrum use. How quickly things change,” Dish says in its letter. “Now, T- Mobile opposes measures that would help new entrants and smaller providers compete.”