Three years ago, it would have seemed unthinkable. Today, Taiwan’s manufacturing giants—once defined by their prowess in consumer electronics—are generating more revenue from AI server production than from iconic products like the iPhone. This tectonic shift reflects a new industrial playbook: one powered by artificial intelligence and driven by global demand for cloud infrastructure.
The Scale of Taiwan’s AI Server Dominance
Taiwan now commands a staggering 90%+ share of the global AI server build market and accounts for about 80% of all server shipments worldwide. This dominance stems from decades of expertise in notebook and consumer electronics assembly, skills now refocused toward AI infrastructure.
From January to July 2024, Taiwan’s server production value hit NT$426.7 billion (USD $13.2 billion)—surpassing the entire 2023 annual total, with year-on-year growth soaring 153.9%.
Taiwan’s ODMs Ride the AI Server Boom
Foxconn: The Icon of Reinvention
Foxconn, historically synonymous with iPhone assembly, marked a milestone in Q2 2025 when its AI servers and cloud/networking revenue overtook consumer electronics: 41% vs. 35%.
Forecasts suggest a 170% year-on-year surge in AI server revenue for Q3, with profits increasing 27%, powered by scaling rack shipments.
Previously, in 2024, consumer electronics comprised 46% of Foxconn’s revenue, compared to 30% from cloud and networking. Chairman Young Liu expects AI server revenue to reach T$1 trillion (~USD $30 billion) this year alone.
Foxconn’s evolution isn’t accidental. Foxconn started crafting NVIDIA graphics card designs in 2002 and entered server manufacturing by 2009. Now holding 40% of the general-purpose and AI server market, it’s scaling operations in the U.S. and Mexico.
This strategic expansion supports NVIDIA’s colossal $500 billion AI infrastructure push, reinforcing Foxconn’s dominance in the sector.
Quanta Computer: From Laptops to AI Backbone
Quanta, a suitable server ODM and supplier for major CSPs (Microsoft, Amazon, Google, Meta), is undergoing a similar shift. By mid-2025, AI servers represented over 60% of its server revenue, expected to reach 70% by year-end.
The company is expanding capacity in the U.S., though facilities are already booked through 2025—a testament to demand.
Wistron & Wiwynn: Scaling to Meet AI Demand
Wistron reported a 92.7% revenue gain from January to July 2025, while Quanta achieved 65.6% growth—illuminating the AI server boom across Taiwan’s ODM landscape.
Wiwynn, a key cloud infrastructure provider, supplies nearly 50% of hyperscale AI server procurement globally, including systems built on NVIDIA’s GB200 platform.
Drivers of Taiwan’s AI Server Supremacy
Legacy Manufacturing and Vertical Integration
Companies like Foxconn, Quanta, Wistron, and Wiwynn built upon decades of high-volume consumer electronics manufacturing. Their transition to AI servers leveraged legacy expertise, reinforced through closer collaboration with GPU giants like NVIDIA.
Record Revenue Growth and Analyst Confidence
AI servers are redefining earnings. Foxconn’s profit rose 27% while AI server revenue growth is expected at 170% or more in Q3. Robert Cheng from BofA highlighted this as evidence of Taiwan ODMs’ rapid adaptation to shifting client needs.
Securing Supply Chains through Partnerships
NVIDIA has booked Wistron’s entire server plant capacity through 2026, ensuring uninterrupted production of Blackwell and Rubin AI servers. Expansion efforts include adding a second facility in Taiwan and a new plant in Dallas, Texas.
Strategic Implications and Risks Ahead
A Redefined Global Tech Role
Taiwan is transforming from a consumer electronics assembly hub into a critical node in global AI infrastructure, supported by deep manufacturing, supply chain synergy, and semiconductor proximity.
Geopolitical Dynamics and Decentralization
To mitigate risk amidst trade tensions and tariffs, Taiwan companies are spreading production across the U.S. and Mexico. This diversification supports U.S. demand and reduces reliance on politically sensitive manufacturing bases.
Intensifying Competition
Taiwan now dominates about 80% of global server shipments and 90%+ of AI servers, but others are expanding. New manufacturing bases in the U.S., Europe, and elsewhere could chip away at Taiwan’s share.
Real-World Impact
- Foxconn: AI server and networking revenue (41%) has surpassed consumer electronics (35%) for the first time.
- Profit Surge: Q2 net profit hit NT$44.36 billion (~USD $1.48 billion)—a 27% increase.
- AI Expansion: Third-quarter AI server growth expected to exceed 170%, with a 300% sequential spike in rack shipments.
- Market Leadership: Taiwan now leads AI server manufacturing, with sustained global client contracts into 2026.
Conclusion
Taiwan’s tech industry has rewritten its narrative. What took Apple nearly two decades to build has been eclipsed in under three years by AI servers. With an unrivaled share of global AI and server production, Taiwan’s manufacturers have recalibrated towards the future of computing.
The industry’s agility—from legacy expertise and strategic alliances to explosive revenue growth—cements Taiwan’s role as an indispensable pillar of the global AI economy.
FAQs
When did AI servers overtake iPhones for revenue in Taiwan?
In Q2 2025, Foxconn and peers reported AI server revenue exceeding consumer electronics revenue for the first time.
What’s fueling this AI server boom?
Demand from cloud providers, strategic partnerships with Nvidia, and decades of manufacturing excellence positioned Taiwan ODMs for rapid AI pivot.
Are Taiwan’s AI server shipments sustainable?
Yes—numbers continue to grow. Wistron alone expects production capacities booked through 2026, pointing to sustained demand.
What risks threaten Taiwan’s dominance?
Increasing global competition, geopolitical tensions, and manufacturing decentralization are long-term risks to its current advantage.