MediaTek Inc (聯發科), the nation’s biggest handset chip designer, on Saturday reported a pretax profit for the first nine months that was more than double the amount in the same period last year.
Analysts attributed the growth to strong demand for smartphone chips in China, which is gearing up to develop its 4G telecom services.
Smartphone chips accounted for 55 to 60 percent of MediaTek’s total sales in the second quarter, they said.
From January to September, the company posted NT$40.57 billion (US$1.33 billion) in pretax profit, up about 101 percent from a year earlier. Its earnings per share before tax for the nine-month period stood at NT$25.82.
Boosted by a strong showing in the third quarter, MediaTek’s consolidated sales in the first nine months of the year rose 63.74 percent year-on-year to NT$157.61 billion, while its operating margin increased 6.2 percentage points to 23.7 percent.
Third-quarter consolidated sales stood at NT$57.47 billion, a 6.16 percent quarterly increase and a new quarterly record high.
Its pretax profit for the third quarter increased 5.37 percent from a quarter earlier to NT$14.91 billion, while its pre-tax earnings per share was NT$9.49.
MediaTek’s operating margin for the third quarter was 24 percent, which was 0.43 percentage points above the previous quarter and the highest in 16 quarters.
The company’s improved consolidated revenue in the third quarter was attributed to not just solid demand for smartphone chips, but also increased shipments of tablet computer chips, TV chips and chips for optical storage devices.
Analysts have forecast that MediaTek’s sales in the fourth quarter are set to drop in what is is usually a slow season for the industry, but said this might be offset to some extent by higher shipments of smartphone chips for 4G networks, which could mean only a single-digit quarterly drop in the company’s fourth-quarter sales.
MediaTek has expanded its business beyond China by targeting the mid-end mobile phone market globally, riding on the rise of the middle classes worldwide.
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