Foxconn on Thursday forecast a significant rise in third-quarter revenue as the world's biggest iPhone maker said it had for the first time made more money from its AI server business than from smart electronics last quarter.

Taiwan's Foxconn, the world's largest contract electronics maker, reported Thursday that its second-quarter operating profit rose 27% year over year, as it leans into its artificial intelligence server business.

Foxconn, also known as Hon Hai Technology Group, reported a 27% rise in quarterly profits as demand for AI servers grows. The company expects year-on-year AI server revenue growth of more than 170% in the third quarter.