Hon Hai Technology Group, better known as Foxconn, is reporting that its second-quarter profits climbed due to its AI server sales, which are now making up the largest portion of revenue for the electronics giant, surpassing smartphones as its top revenue source.

Foxconn expects higher third-quarter revenue, it said on Thursday, on robust demand for artificial intelligence servers, which helped the world's largest contract electronics maker report a forecast-beating 27% increase in second-quarter profit.

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.