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.

Foxconn reported a better-than-expected 27% rise in profit in Q2 and forecast higher sales growth in its AI server business in Q3.

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.