SHCAY Sharp Corporation (PK)

HONG KONG—Foxconn Technology Group, the world's biggest assembler of Apple Inc. gadgets, reported a decline in third-quarter net profit, weighed by losses at recently acquired Japanese electronics maker Sharp Corp.

Sharp's losses were a drag on what was otherwise a quarter of brisk sales because of production of the iPhone 7 for Apple, Foxconn's largest customer.

Formally known as Hon Hai Precision Industry Co., Foxconn said in a statement Friday that net profit fell to $34.6 billion New Taiwanese dollars ($1.09 billion) for the July-September quarter from NY$37.9 billion a year earlier, but it still beat the NT$33.3 billion average estimate of nine analysts polled by Capital IQ.

Revenue rose to NT$1.075 trillion from NT$1.066 trillion a year earlier.

Foxconn completed its $3.8 billion acquisition of Sharp in August after years of tumultuous negotiations and last-minute hitches that almost derailed the deal. Sharp's advanced flat-screen panel business fits into Foxconn's strategy to expand into high-end components—a more lucrative business than electronics assembly.

Foxconn has said it would help Sharp speed its efforts to mass-produce organic light-emitting diode, or OLED, displays, a technology that holds promise for next-generation gadgets with flexible screens. Apple is considering adopting this technology for iPhones as early as next year, The Wall Street Journal has reported.

But Sharp's new chief executive, Tai Jeng-wu, said recently that he hasn't yet decided if his company will commit fully to OLED or stick with more widely used liquid-crystal displays.

While manufacturing devices for Apple is still Foxconn's largest source of revenue, the Taipei-based company increasingly has diversified into other high-tech fields ranging from telecom infrastructure to robotics and e-commerce.

Sharp last week reported a quarterly net loss of ¥ 17.9 billion ($170.8 million) but said it would return to profitability by the second half of its fiscal quarter, which ends March 31.

Write to Eva Dou at eva.dou@wsj.com

(END) Dow Jones Newswires

November 11, 2016 09:55 ET (14:55 GMT)

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