by SONG Jianan

Foxconn has stepped up its expansion into artificial-intelligence hardware, signing a preliminary agreement with OpenAI to co-develop next-generation data-center infrastructure and prepare for U.S. manufacturing, the two companies said on Nov. 20.

The non-binding deal includes no purchase commitments, but OpenAI will have priority review rights and retain the option to source future hardware from Foxconn. The U.S. developer will share insight into emerging AI-compute needs to guide products built at Foxconn's U.S. facilities.

Both sides will work on multi-generation data-center cabinet design, engineering and testing in parallel, aiming to simplify the U.S. AI hardware supply chain and expand domestic production of key components such as cabling, networking, cooling and power-delivery systems.

Foxconn said it plans to broaden U.S. sourcing channels by including more chipsets and domestic suppliers and scale up local testing and assembly. The company's U.S. sites will manufacture critical equipment used in high-performance computing.

Hon Hai, Foxconn's parent company, separately announced a U.S. joint venture with Intrinsic, the robotics and AI software unit of Alphabet, to build "AI-native" robotic factories. The venture will integrate Intrinsic's AI platform with Hon Hai's manufacturing systems to develop adaptive robotic solutions for assembly, inspection, maintenance and logistics.

The twin moves underscore Foxconn's pivot toward AI infrastructure as global demand for computing power surges. The company's listed unit Fii reported third-quarter revenue of 243.17 billion yuan (about US$34 billion), up 42.8% year on year, with quarterly net profit surpassing 10 billion yuan for the first time. AI servers and cloud products accounted for 42% of revenue in the first three quarters, overtaking consumer electronics as its largest business.

AI demand has continued to expand despite rising concerns about overheating. Nvidia CEO Jensen Huang said this week that the "AI ecosystem is expanding rapidly" across industries and geographies, pushing back against talk of an emerging bubble. Ray Dalio, founder of Bridgewater Associates, said AI-related investment activity may show bubble characteristics but does not imply an imminent correction.

For Foxconn, deeper collaboration with OpenAI and Alphabet's Intrinsic marks an effort to secure a larger role in the global AI supply chain and reduce its reliance on consumer-electronics manufacturing.