Foxconn is working on a new collaboration with OpenAI, the company's chairman said on October 30, adding that he sees no sign of the AI bubble that Wall Street has been trading around all week. The comments from Young Liu, who leads the Taiwanese manufacturing giant also known as Hon Hai Precision Industry, signal that the world's largest contract electronics maker intends to deepen its position at the heart of the AI infrastructure buildout even as investors turn cautious.
According to Reuters, Liu confirmed the new tie-up is in the works but offered little detail about its scope. In separate coverage, BusinessLine reported that Liu said he met OpenAI CEO Sam Altman in Taiwan, while MarketScreener described the two companies as moving toward a formal collaboration. For a fuller picture of how the AI hardware race is reshaping corporate strategy, follow our AI business coverage.
Building on an Existing Partnership
The new arrangement would extend a relationship that already runs deep. In November 2025, OpenAI and Foxconn announced a partnership to design and eventually manufacture AI data center hardware in the United States, an agreement reported at the time by Reuters, Bloomberg, and CNBC. The collaboration was aimed at shortening the path between OpenAI's rack designs and mass production on American soil, with TrendForce subsequently reporting that output had reached a pace of 1,000 server racks per week.
Foxconn's push into AI servers has become the engine of its growth. The company built its reputation assembling a majority of the world's iPhones, but AI server demand has increasingly dominated its revenue trajectory over the past two years, making Hon Hai one of the clearest industrial beneficiaries of the compute buildout. Liu has been explicit about his ambitions: according to Crypto Briefing, the chairman has said he is targeting as much as half of the global AI server market for the company.
"There Is No AI Bubble"
Liu's dismissal of bubble fears stands in sharp contrast to the mood in financial markets. The Wall Street Journal reported on October 30 that the selloff in AI-related stocks had deepened, and Alphabet's roughly $500 billion market-value loss earlier in the week — driven by concerns that AI search summaries are eroding its advertising business — has become the emblem of investor anxiety about whether enormous AI capital expenditures will ever pay off.
Manufacturers like Foxconn sit on a different side of that debate. Whatever happens to model-makers' valuations, the racks still have to be built, and Foxconn's order book currently reflects that reality. Liu's argument, in effect, is that physical demand for AI compute is visible in a way that software monetization is not.
What the New Tie-Up Could Involve
Neither company has detailed what the new collaboration would cover, and initial reporting did not specify whether it involves additional manufacturing capacity in the United States, new hardware designs, or supply commitments beyond the existing November 2025 agreement. The announcement coincided with Hon Hai's Tech Day 2026, the company's annual technology showcase, giving Liu a prominent stage to make the case that his company's AI pivot is just beginning.
For OpenAI, deeper ties with Foxconn would strengthen a supply chain the company has been building aggressively — spanning chip procurement, data center construction partners, and now one of the most experienced electronics integrators in the world. For Foxconn, the validation of being a named OpenAI partner helps secure its position as hyperscalers and AI labs race to secure manufacturing capacity, and gives it leverage as competitors across Asia and the United States court the same customers.
The Taiwan Factor
There is a geopolitical layer to the arrangement as well. Foxconn's manufacturing core sits in Taiwan and mainland China, while the AI companies buying its servers — OpenAI chief among them — are under growing pressure in Washington to build compute capacity inside the United States. The November 2025 agreement was explicitly framed around design and manufacturing in the US, and any expanded collaboration would likely face the same pull: Taiwanese engineering depth on one side, American political and customer demands on the other.
That tension is an opportunity for Foxconn as much as a constraint. As one of the few companies with the scale to assemble AI server racks by the thousand — and with existing facilities across both regions — Hon Hai is positioned to arbitrage the divide, building where its customers need the finished product to land. Liu's 50 percent market-share ambition only makes sense in that context: no single region can currently supply the volume of AI hardware the largest labs are demanding, and the manufacturer that can coordinate across all of them becomes indispensable.
The Weeks Ahead
The scope of the collaboration, its geography, and its financial terms all remain to be seen, and investors will be watching for specifics when Foxconn reports its quarterly results and outlines its 2027 outlook. But the strategic direction Liu described is unambiguous: the company that put the smartphone on the world's desks intends to be the company that puts AI compute in the world's data centers, bubble or no bubble in everything layered on top.
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