TAIPEI, July 5 (Reuters) - Taiwan's Foxconn,

the world's largest contract electronics maker and Apple's ( AAPL )

biggest iPhone assembler, posted on Friday better-than-expected

quarterly revenue on AI server demand, and forecast continued

growth in the current quarter.

The third quarter is traditionally the start of the season

for Taiwan's tech companies to race to supply smartphones,

tablets and other electronics to major vendors such as Apple ( AAPL )

for Western markets' year-end holiday period.

Foxconn is also powering ahead due to strong demand for

servers for artificial intelligence (AI) applications, and its

customers include AI darling Nvidia ( NVDA ).

This year's third quarter is expected to see revenue grow

both year-on-year and compared with the previous quarter,

Foxconn said in a statement.

"Entering the peak season of the second half of the

year, we anticipate our operation to gradually gain momentum,"

it said.

The company does not provide numerical forecast.

Foxconn, formally called Hon Hai Precision Industry Co Ltd ( HNHPF ),

said revenue last month reached T$490.7 billion ($15.12

billion), up 16.1% year-on-year and at the second-highest level

for the same period.

For the second quarter, revenue soared 19.1%

year-on-year to T$1.55 trillion, beating a T$1.51 trillion LSEG

SmartEstimate, which gives greater weight to forecasts from

analysts who are more consistently accurate, and a record high

for the same period.

Second-quarter revenue in its cloud and networking

products segment showed strong growth year-on-year and

quarter-on-quarter benefiting from strong AI server demand, it

said.

However for smart consumer electronics products,

including smartphones, revenue was flat year-on-year, Foxconn

said, without providing an explanation.

Foxconn's shares have surged 105% so far this year,

outperforming a 31% jump for the broader Taiwan market.

In line with the overall market, Foxconn's shares closed

flat on Friday ahead of the revenue data release.

The company will report its second-quarter earnings on

Aug. 14.

($1 = 32.4430 Taiwan dollars)