MediaTek Inc (聯發科), the nation’s biggest handset chip supplier, yesterday posted the strongest quarterly profit in about three years for last quarter, primarily boosted by demand for smartphones in China and emerging markets.
The Hsinchu-based company gave an encouraging outlook for the current quarter to sustain last quarter’s growth momentum.
“The seasonal weakness in the fourth quarter will not be as evident as before, offset by sales of new chips,” MediaTek president Hsieh Ching-jiang (謝清江) told a teleconference.
Revenue is expected to be flat or to slide by 5 percent sequentially to between NT$37 billion and NT$39 billion (US$1.26 billion and US$1.32 billion), compared with NT$37 billion last quarter, Hsieh said. Smartphone chips made up about 60 percent of MediaTek’s total revenue last quarter.
The forecast is much better than expected as MediaTek posted a quarterly decline of 15 percent on average in the fourth quarter over the past five years.
It also surpassed the NT$34.33 billion estimated by Credit Suisse analyst Randy Abrams. Daiwa Capital Markets analyst Eric Chen (陳慧明) expected MediaTek to guide a single-digit percentage point sequential decline in revenue.
The positive outlook may be due to Chinese brands’ aggressive plan to launch more new handsets this quarter, Abrams said.
MediaTek last quarter added Xiaomi Corp (小米) to its more than 40 clients, which include Lenovo Group (聯想), ZTE Corp (中興) and LG Electronics Co.
This quarter, MediaTek plans to ship new octa-core smartphone chips and to see broad adoption of its cost-effective quad-core chips, Hsieh said. The firm also plans to launch 4G long-term evolution (LTE) chips at the end of this year, he said.
Overall gross margin is expected to stay in the range of between 43 percent and 45 percent this quarter, compared with last quarter’s 43.9 percent, as the company aims to boost higher-margin quad-core smartphone chip shipments to account for 40 percent of total smartphone chips, up from 30 percent last quarter, Hsieh said.
MediaTek expects to ship 65 million units of smartphone chip this quarter, on a par with the previous quarter. For the whole of this year, total smartphone chip shipments are likely to surpass the firm’s target of 200 million units for this year, doubling last year’s 108 million units, he said.
During the three-month period ending in September, net profit leapt 25.3 percent to NT$8.42 billion, compared with NT$6.72 billion in the previous quarter,and better than Daiwa’s estimate of NT$8.34 billion. On an annual basis, that was a 71.2 percent growth from NT$4.92 billion.
Inventory in last quarter reduced to NT$12.94 billion, or 50 days, compared with NT$10.96 billion, or 57 days, a quarter ago, MediaTek chief financial executive David Ku (顧大為) said, citing better-than-expected demand last quarter.
Meanwhile, Mstar Semiconductor Inc (晨星半導體), the world’s biggest supplier of chips used in flat-panel TVs, yesterday posted 36 percent sequential growth for third-quarter net profit to NT$1.48 billion, boosted by seasonal demand. Gross margin stood at 45.3 percent.
MStar is set to be merged with MediaTek next year.
In the first three quarters of this year, MStar’s net profit rose 2.54 percent to NT$3.63 billion from NT$3.54 billion a year ago. Gross margin improved to 44.55 percent from 40.12 percent year-on-year.
Revenue slid 12 percent to NT$24.6 billion in the first three quarters of this year, from NT$27.99 billion in the prior year, company data showed.
Among the rows of vibrators, rubber torsos and leather harnesses at a Chinese sex toys exhibition in Shanghai this weekend, the beginnings of an artificial intelligence (AI)-driven shift in the industry quietly pulsed. China manufactures about 70 percent of the world’s sex toys, most of it the “hardware” on display at the fair — whether that be technicolor tentacled dildos or hyper-realistic personalized silicone dolls. Yet smart toys have been rising in popularity for some time. Many major European and US brands already offer tech-enhanced products that can enable long-distance love, monitor well-being and even bring people one step closer to
Malaysia’s leader yesterday announced plans to build a massive semiconductor design park, aiming to boost the Southeast Asian nation’s role in the global chip industry. A prominent player in the semiconductor industry for decades, Malaysia accounts for an estimated 13 percent of global back-end manufacturing, according to German tech giant Bosch. Now it wants to go beyond production and emerge as a chip design powerhouse too, Malaysian Prime Minister Anwar Ibrahim said. “I am pleased to announce the largest IC (integrated circuit) Design Park in Southeast Asia, that will house world-class anchor tenants and collaborate with global companies such as Arm [Holdings PLC],”
TRANSFORMATION: Taiwan is now home to the largest Google hardware research and development center outside of the US, thanks to the nation’s economic policies President Tsai Ing-wen (蔡英文) yesterday attended an event marking the opening of Google’s second hardware research and development (R&D) office in Taiwan, which was held at New Taipei City’s Banciao District (板橋). This signals Taiwan’s transformation into the world’s largest Google hardware research and development center outside of the US, validating the nation’s economic policy in the past eight years, she said. The “five plus two” innovative industries policy, “six core strategic industries” initiative and infrastructure projects have grown the national industry and established resilient supply chains that withstood the COVID-19 pandemic, Tsai said. Taiwan has improved investment conditions of the domestic economy
Sales in the retail, and food and beverage sectors last month continued to rise, increasing 0.7 percent and 13.6 percent respectively from a year earlier, setting record highs for the month of March, the Ministry of Economic Affairs said yesterday. Sales in the wholesale sector also grew last month by 4.6 annually, mainly due to the business opportunities for emerging applications related to artificial intelligence (AI) and high-performance computing technologies, the ministry said in a report. The ministry forecast that retail, and food and beverage sales this month would retain their growth momentum as the former would benefit from Tomb Sweeping Day