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MediaTek says sales to rise 10 percent

MediaTek Inc (聯發科技), the world's largest maker of chips for DVD players, said fourth-quarter sales will rise 10 percent from the third on demand for semiconductors used in mobile phones.

The company's gross margin will remain unchanged in the fourth quarter from 55.7 percent in the third, Hsinchu-based MediaTek said yesterday at a press conference.

MediaTek, which supplies chips for about half of the world's DVD players, is counting on semiconductors used in handsets with built-in cameras and music players to drive sales.

"MediaTek is serious about gaining market share in the cellphone chips business," said Jesse Huang, a fund manager at Shinkong Investment Trust Co (新光投信). "That will help offset seasonal weakness in DVD-player sales in the fourth quarter."

Net income in the third quarter rose 41 percent to NT$6 billion (US$179 million) from NT$4.2 billion a year earlier, the company said. Sales, reported earlier, rose 14 percent to NT$12.8 billion.

MediaTek plans to sell 4 million to 5 million cellphone chips a month in the current quarter, compared with over 3 million units in September, company Chairman Tsai Ming-chieh (蔡明介) said.

The company started making cellphone chips in the third quarter last year when there was a glut of chips used in DVD players and rec-orders. The company said the handset chips will make up over 25 percent of fourth-quarter sales.
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