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MediaTek's January sales fell 3 percent

MediaTek Inc (聯發科技), the world's largest maker of chips for DVD players, said January sales fell 3 percent to NT$2.8 billion (US$84.1 million) from NT$2.9 billion in January last year. December sales were NT$3.2 billion.

The decline in January sales, the first since July 2001, reflected the four fewer working days during the month because of the Lunar New Year holiday, which was in February last year, analysts said.

The DVD player market will grow to 110 million units this year from about 90 million units last year, according to Ingrid Yang, an analyst with ABN Amro in Taipei.

"The whole pie is getting bigger," said Yang. "Sales should keep growing for MediaTek."

The company yesterday said first-quarter sales would fall by 15 percent from NT$10.9 billion in the fourth quarter. That would mean first-quarter sales of NT$9.3 billion, an 8 percent rise on the NT$8.6 billion in the first quarter last year.

MediaTek said it expects its first-quarter profit margin to narrow to 50 percent from 52 percent in the fourth quarter as demand declines after the holiday peak. The company plans to sell new lines of chips for mobile phones this year as rivals enter the market for DVD-player chips.

MediaTek's share of the DVD player-chip market exceeds 60 percent, Yang said. MediaTek and new Taiwan rival Sunplus Technology Co (凌揚科技) have been gaining market share, she said.
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