MediaTek Inc (聯發科), which mainly supplies handset chips to Chinese brands such as Oppo Mobile Telecommunications Corp (歐珀移動), yesterday reported 47 percent quarterly growth in pre-tax profit for last quarter, benefiting from robust demand across the Taiwan Strait.
Pre-tax profit soared to NT$7.75 billion (US$245 million) during the quarter ending June 30, compared with NT$5.28 billion in the first quarter, the company said in a filing to the Taiwan Stock Exchange.
Operating profit surged about 61 percent to NT$7.07 billion last quarter, from NT$4.4 billion in the prior quarter, its financial statement showed. Operating profit margin climbed to 9.75 percent last quarter, from 7.87 percent in the previous quarter.
Despite the growth, MediaTek’s pre-tax profit fell short of HSBC Securities analyst Yolanda Wang’s (王郁雅) and Macquarie Capital Securities analyst Patric Liao’s (廖光河) respective forecasts of NT$8.8 billion and NT$7.88 billion.
MediaTek is scheduled to release its business outlook and financial details, including gross margin, tomorrow. Investors have been closely monitoring the firm’s margin, which has been on a downtrend due to stiff pricing competition.
The chip designer said in April that gross margin for this quarter might fall to an all-time low of 35 percent in a worst-case scenario from 38.1 percent the previous quarter. Liao and Wang project a smaller fall to 36.4 percent and 35.5 percent respectively.
MediaTek chairman Tsai Ming-kai (蔡明介) said in June that the company saw a better-than-expected recovery in demand and the company has been working to resolve a shortage of chips since early in the second quarter.
He expected the growth momentum to carry into this quarter on seasonal factors.
MediaTek’s earnings growth came as Chinese handset makers reported about 14 percent quarterly growth in shipments last quarter to 139 million units, outpacing the combined shipments of 125 million units by Apple Inc and Samsung Electronics Co, according to statistics compiled by market researcher TrendForce Corp (集邦科技).
Oppo, the world’s No. 4 smartphone supplier, saw its global market share rise to 5.6 percent last quarter from 5.3 percent in the previous quarter, while Vivo Electronics Corp (維沃移動通信), another Chinese client of MediaTek, captured 4.7 percent of the market last quarter, little changed from a quarter ago. Vivo was ranked No. 6.
TrendForce expects Chinese smartphone vendors to continue to outperform their bigger global rivals in shipment growth this quarter.
Oppo and Vivo are expected to see a quarterly growth of 20 percent in shipment this quarter, TrendForce said.
MediaTek shares rallied 2.26 percent to close at NT$249 yesterday, outperforming the TAIEX, which gained 1.07 percent.
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