Chip designer MediaTek Inc (聯發科) expects quarterly revenue to grow up to 6 percent on stabilizing demand and contributions from a newly acquired power management chip supplier.
The company, which supplies handset chips to Xiaomi Corp (小米) and Huawei Technology Co (華為), expects sales to reach between NT$57 billion and NT$60.4 billion (US$1.74 billion and US$1.84 billion) this quarter, compared with last quarter’s NT$56.96 billion.
“We are seeing overall demand become relatively stable in the fourth quarter compared with the third quarter,” MediaTek vice chairman and president Hsieh Ching-jiang (謝清江) told an investors’ teleconference yesterday.
Richtek Technology Corp (立錡), 50 percent owned by MediaTek, is to help boost the firm’s revenue by 3 percent to 5 percent this quarter, Hsieh said.
The revenue forecast beat expectations of quarterly declines of 3 percent by HSBC Securities Corp and 7.8 percent by Yuanta Securities Co (元大證券).
However, gross margin is to continue to fall to about 40 percent this quarter from 42.7 percent last quarter, due to intensifying price competition for 3G and 4G mobile phone chips.
Average selling prices of the company’s products are also expected to rebound about 5 percent from last quarter, as the company expects to ship more advanced chips supporting long-term evolution (LTE) technology.
Shipments of smartphone chips are to drop about 12.5 percent from last quarter to 105 million units, with the eight-core chips accounting for 25 percent of total shipments this quarter, Hsieh said.
The company retained its full-year shipment target of 400 million chips.
As the Chinese smartphone market’s growth is slowing down, MediaTek is now targeting emerging markets, such as India, for new momentum, Hsieh said.
“We are seeing nascent demand for LTE smartphones in India as retail prices of those phones have fallen to a sweet spot,” Hsieh said.
Emerging markets are expected to grow by between 10 percent and 15 percent annually over the next few years.
China and developed countries are expected to grow 5 percent annually, or even remain flat, he said.
As for chips for tablet devices, MediaTek said shipments might drop from last quarter’s 20 million units to 15 million units this quarter.
It said its full-year shipment target would remain at 50 million chips.
Tablet and mobile phone chips are MediaTek’s biggest source of revenue, contributing as much as 65 percent.
The company made the forecasts after reporting a 25 percent sequential increase in net profit to NT$7.96 billion for last quarter, ending three straight quarters of decline.
HORMUZ ISSUE: The US president said he expected crude prices to drop at the end of the war, which he called a ‘minor excursion’ that could continue ‘for a little while’ The United Arab Emirates (UAE) and Kuwait started reducing oil production, as the near-closure of the crucial Strait of Hormuz ripples through energy markets and affects global supply. Abu Dhabi National Oil Co (ADNOC) is “managing offshore production levels to address storage requirements,” the company said in a statement, without giving details. Kuwait Petroleum Corp said it was lowering production at its oil fields and refineries after “Iranian threats against safe passage of ships through the Strait of Hormuz.” The war in the Middle East has all but closed Hormuz, the narrow waterway linking the Persian Gulf to the open seas,
RATIONING: The proposal would give the Trump administration ample leverage to negotiate investments in the US as it decides how many chips to give each country US officials are debating a new regulatory framework for exporting artificial intelligence (AI) chips and are considering requiring foreign nations to invest in US AI data centers or security guarantees as a condition for granting exports of 200,000 chips or more, according to a document seen by Reuters. The rules are not yet final and could change. They would be the first attempt to regulate the flow of AI chips to US allies and partners since US President Donald Trump’s administration said it rescinded its predecessor’s so-called AI diffusion rules. Those rules sought to keep a significant amount of AI
Apple Inc increased iPhone production in India by about 53 percent last year and now makes a quarter of its marquee devices there, reflecting the US company’s efforts to avoid tariffs on China. The company assembled about 55 million iPhones in India last year, up from 36 million a year earlier, people familiar with the matter said, asking not to be named because the numbers aren’t public. Apple makes about 220 million to 230 million iPhones a year globally, with India’s share of the total increasing rapidly. Apple has accelerated its expansion in the world’s most populous country in recent years, bolstered
HEADWINDS: The company said it expects its computer business, as well as consumer electronics and communications segments to see revenue declines due to seasonality Pegatron Corp (和碩) yesterday said it aims to grow its artificial intelligence (AI) server revenue more than 10-fold this year from last year, driven by orders from neocloud solutions clients and large cloud service providers. The electronics manufacturing service provider said AI server revenue growth would be driven primarily by the Nvidia Corp GB300 server platform. Server shipments are expected to increase each quarter this year, with the second half likely to outperform the first half, it said. The AI server market is expected to broaden this year as more inference applications emerge, which would drive demand for system-on-chip, application-specific integrated circuits
RSS