MediaTek Inc (聯發科), the world’s largest supplier of mobile phone chips, yesterday said that revenue this quarter could grow by up to 10 percent, bolstered by China’s economic stimulus program and customers pulling in orders amid concern over US tariffs.
The first quarter tends to be a slack season, but MediaTek expects moderate revenue growth from its two major business segments — smartphone chips and smart edge platforms such as Wi-Fi chips.
Revenue is expected to increase sequentially by 2 to 10 percent to NT$140.8 billion to NT$151.8 billion (US$4.3 billion and US$4.6 billion) during the quarter ending March 31, the chip designer said.
Photo: CNA
“Overall, for the first quarter of 2025, we see healthy smartphone demand thanks to China’s stimulus program, as well as some pull-in demand for products such as televisions, Wi-Fi, tablets and Chromebooks due to global tariff uncertainties,” MediaTek CEO Rick Tsai (蔡力行) told investors during a quarterly conference yesterday.
“Therefore, we expect first-quarter revenue to grow sequentially at a better-than-normal seasonal pace. Corporate gross margin is expected to be stable,” he said.
The company expects gross margin to come in at 47 percent give or take 1.5 percentage points, he said.
MediaTek is highly concentrated on the Chinese smartphone market. Strong uptake of Oppo’s (歐珀) and Vivo’s (維沃) artificial intelligence (AI)-enabled phones has helped the company more than double its flagship smartphone chip revenue last year, significantly exceeding its goal of 70 percent annually.
However, the mobile phone chip designer said that the visibility for the next quarter is low, mostly due to the global tariff war triggered by the US.
However, the AI megatrend is here to stay, the company said.
With recent launch of DeepSeek’s (深度求索) more cost-efficient AI model, MediaTek is “getting more optimistic” about such a trend, given the democratizing of AI applications among average users, Tsai said.
That bodes well not only for the growth of edge AI devices, but also for cloud-based data centers, he said.
As the world’s major cloud service providers are “doubling down” on their investments in AI data centers, MediaTek is investing heavily in AI application-specific-IC (ASIC) business by adding engineers, mainly in the US, and internal resources reallocations, aiming to enhance and broaden its AI ASIC business scope, Tsai said.
MediaTek expects its new AI ASIC business to bear fruit next year and contribute more than US$1 billion in revenue in the first or second quarter, he said.
The global AI ASIC market is estimated to reach US$45 billion by 2028, according to MediaTek’s previous forecast, which did not factor in the impact of DeepSeek.
The budget-friendly AI model from DeepSeek would accelerate the adoption of AI applications, Tsai said.
MediaTek added that its collaboration with Nvidia Corp to roll out a GB10 chip used for AI desktop applications would hit the shelves in May and be available for more diversified applications later this year.
The company reported that net profit last quarter slid 6.9 percent year on year to NT$23.94 billion from NT$25.71 billion. On a quarterly basis, it declined 6.4 percent from NT$25.59 billion.
Last year as a whole, net profit surged 38.8 percent annually to NT$107.14 billion from NT$77.19 billion in 2023, marking the third-highest level in the company’s history. Earnings per share surged to NT$66.92 from NT$48.51.
Gross margin improved to 49.6 percent last year from 47.8 percent in 2023.
Revenue rose 19 percent year-on-year in US dollar terms, beating the firm’s goal of 15 percent growth.
NO BREAKTHROUGH? More substantial ‘deliverables,’ such as tariff reductions, would likely be saved for a meeting between Trump and Xi later this year, a trade expert said China launched two probes targeting the US semiconductor sector on Saturday ahead of talks between the two nations in Spain this week on trade, national security and the ownership of social media platform TikTok. China’s Ministry of Commerce announced an anti-dumping investigation into certain analog integrated circuits (ICs) imported from the US. The investigation is to target some commodity interface ICs and gate driver ICs, which are commonly made by US companies such as Texas Instruments Inc and ON Semiconductor Corp. The ministry also announced an anti-discrimination probe into US measures against China’s chip sector. US measures such as export curbs and tariffs
The US on Friday penalized two Chinese firms that acquired US chipmaking equipment for China’s top chipmaker, Semiconductor Manufacturing International Corp (SMIC, 中芯國際), including them among 32 entities that were added to the US Department of Commerce’s restricted trade list, a US government posting showed. Twenty-three of the 32 are in China. GMC Semiconductor Technology (Wuxi) Co (吉姆西半導體科技) and Jicun Semiconductor Technology (Shanghai) Co (吉存半導體科技) were placed on the list, formally known as the Entity List, for acquiring equipment for SMIC Northern Integrated Circuit Manufacturing (Beijing) Corp (中芯北方積體電路) and Semiconductor Manufacturing International (Beijing) Corp (中芯北京), the US Federal Register posting said. The
READY TO HELP: Should TSMC require assistance, the government would fully cooperate in helping to speed up the establishment of the Chiayi plant, an official said Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) yesterday said its investment plans in Taiwan are “unchanged” amid speculation that the chipmaker might have suspended construction work on its second chip packaging plant in Chiayi County and plans to move equipment arranged for the plant to the US. The Chinese-language Economic Daily News reported earlier yesterday that TSMC had halted the construction of the chip packaging plant, which was scheduled to be completed next year and begin mass production in 2028. TSMC did not directly address whether construction of the plant had halted, but said its investment plans in Taiwan remain “unchanged.” The chipmaker started
MORTGAGE WORRIES: About 34% of respondents to a survey said they would approach multiple lenders to pay for a home, while 29.2% said they would ask family for help New housing projects in Taiwan’s six special municipalities, as well as Hsinchu city and county, are projected to total NT$710.65 billion (US$23.61 billion) in the upcoming fall sales season, a record 30 percent decrease from a year earlier, as tighter mortgage rules prompt developers to pull back, property listing platform 591.com (591新建案) said yesterday. The number of projects has also fallen to 312, a more than 20 percent decrease year-on-year, underscoring weakening sentiment and momentum amid lingering policy and financing headwinds. New Taipei City and Taoyuan bucked the downturn in project value, while Taipei, Hsinchu city and county, Taichung, Tainan and Kaohsiung
RSS