MediaTek Inc (聯發科), a major supplier of handset chips to Chinese brands including Xiaomi Corp (小米), yesterday reported that its revenue rose 5 percent from May to NT$16.62 billion (US$533 million) last month.
However, its second-quarter revenue edged down 1.05 percent to NT$47.04 billion. Although channel inventory fell and foreign exchange rates stabilized, emerging-market demand remained weak in the face of a strong US dollar, the company said.
Last quarter’s revenue was in line with its forecast range of between NT$45.2 billion and NT$49 billion and SinoPac Securities Investment Service Co’s (永豐投顧) projection of NT$47.43 billion, but lagged behind JPMorgan Securities Ltd’s estimates of NT$49.75 billion.
For this quarter, JPMorgan analyst Gokul Hariharan said MediaTek could see a 35 percent quarterly growth in shipments and 25 percent sequential growth in revenue to NT$62.14 billion.
SinoPac analyst Martina Huang (黃瑞君) predicted a quarterly increase of 23.8 percent in sales, citing rising demand from Chinese smartphone brands ahead of the October holiday season.
MediaTek shares slid 0.4 percent yesterday to close at NT$418 in Taipei trading, hitting its lowest in about two weeks, Taiwan Stock Exchange data showed.
Analysts said MediaTek shares would continue to face short-term headwinds because of intensifying pricing competition.
The company likely cut 3G chip prices by up to 30 percent since the beginning of the year to retain market share, Harihara said, as China’s Spreadtrum Communications Inc (展訊) has secured orders from Indian vendors.
Falling 3G chip pricing will weigh on MediaTek’s gross margin in the second half, he said.
The company is pinning its hope on a high-end 4G deca-core chip — the Helio X20 — after an earlier version — the Helio X10 — saw limited adoption among smartphone brands, analysts said.
Shipments of Helio X20 chips are expected to start by the end of this year, with the chip expected to account for 10 percent of the company’s total shipments this year, MediaTek said.
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