MediaTek Inc (聯發科), the world’s biggest smartphone chip supplier, yesterday said it is engaging a second hyperscaler to help design artificial intelligence (AI) accelerators used in data centers following a similar project expected to generate revenue streams soon.
The first AI accelerator project is to bring in US$1 billion revenue next year and several billion US dollars more in 2027, MediaTek chief executive officer Rick Tsai (蔡力行) told a virtual investor conference yesterday.
The second AI accelerator project is expected to contribute to revenue beginning in 2028, Tsai said.
Photo: CNA
MediaTek yesterday raised its revenue forecast for the global AI accelerator used in data centers to US$50 billion by 2028, up from an earlier estimate of US$40 billion, based on heavy AI infrastructure investments pledged by the world’s major hyperscalers.
“We are vying for a 10 percent to 15 percent share of this market going forward in the next two years or more,” Tsai said.
The chipmaker’s comments came amid lingering concern about MediaTek’s progress in tapping growing demand for application-specific ICs (ASIC) from hyperscalers, which aim to reduce dependence on pricey AI chips from Nvidia Corp by designing their own chips for more tailor-made features. That is a new business MediaTek is hoping to develop by leveraging its strong intellectual-property capacities.
For the short-term business outlook, MediaTek expected to report an “anti-seasonal growth” in the fourth quarter, driven by strong demand for its flagship smartphone chips and auto chips
Revenue this quarter would be flat or rise 6 percent sequentially to NT$142.1 billion to NT$150.1 billion (US$4.6 billion to US$4.9 billion), from NT$142.1 billion last quarter, MediaTek projected.
Mobile phone chips were the largest revenue source last quarter, accounting for 53 percent.
That would help bring the company’s total revenue this year to more than US$19 billion, an all-time high, Tsai said. MediaTek expects the growth momentum to carry into next year.
As leading-edge process technology capacity becomes scarce and costly, MediaTek said it would strategically adjust its pricing and allocate its capacity among different product lines to reflect increasing manufacturing costs.
The company might be referring to potential wafer price hikes from its major foundry partner Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), an analyst said during the conference yesterday. MediaTek said it is seeking to pass the increases in supply chain costs to customers.
MediaTek plans to offer new flagship smartphone chips based on TSMC’s 2-nanometer process technology next year, it said.
Gross margin this quarter is expected to trend down to about 46 percent from 46.5 percent last quarter, the company forecast. That would mark a fifth quarter of decline since the fourth quarter of last year.
MediaTek attributed an unfavorable product mix to the potential gross margin contraction this quarter, since smartphone chips, including flagship smartphone chips, deliver lower margins than corporate averages.
The chipmaker yesterday reported a 9.3 percent sequential decline in net profit for last quarter to NT$25.45 billion, compared with NT$28.06 billion in the second quarter.
On an annual basis, net profit edged 0.5 percent lower from NT$25.59 billion.
Earnings per share dropped to NT$15.84 last quarter from NT$17.5 in the prior quarter and NT$15.94 in the same period last year.
Gross margin dipped to 46.5 percent from 49.1 percent in the second quarter and 48.8 percent in the third quarter last year.
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