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MediaTek Nearly Doubles Sales, Looks to Wearables

30 April 2014

Fabless mobile chip company MediaTek Inc. nearly doubled its sales revenue and nearly tripled its net income in its financial results for the first financial quarter ended March 31, 2014.

The stellar performance was mainly due to the merger with MStar, which became effective on February 1, and strength in the smartphone market where MediaTek (Hsinchu, Taiwan) plays at mid- and entry-levels. MediaTek acquired a 48 percent stake in MStar in August 2012 but had to undergo a lengthy approvals process with authorities in Taiwan, South Korea, and China for a total merger.

MediaTek reported sales revenue at NT46.00 billion (about 1.53 billion) for 1Q14, up 15.6 percent sequentially and up 91.9 percent compared with the same quarter a year before. The net income of NT10.14 billion (about $350 million) or 22 percent of sales was up 17.7 percent sequentially and up 171.4 percent compared with 1Q13.

For the second quarter the company said it expects sales revenue to increase to between NT51.5 billion (about $1.70 billion) and NT55.2 billion (about $1.83 billion) in the second quarter, representing a 16 percent increase at the mid-point.

Meanwhile the company's CFO, David Ku, told analysts that its 32-bit octa-core with LTE modem, the MT6595, would be in volume production in 3Q14 one quarter ahead of schedule. To follow on MediaTek has two 64-bit SoCs for smartphones – the quad-core MT6732 and and octa-core MT6752 which will be in volume production in 4Q14 on their original schedule Ku said.

Upside abounds with tablets and wearables

Established 64-bit smartphone chips are already available Intel, Qualcomm, Marvell and Apple uses a 64-bit processor of its down design its iPhones. MediaTek's 64-bit CPUs are expected to target the entry-level to mid-range smartphone segment and the market is moving towards MediaTek as octa-core 64-bit SoCs become mainstream, even for mid-range smartphones.

Ku said that in the second quarter he expected the breakdown of MediaTek smartphone SOC shipments by number of cores would be 10 to 15 percent octa, 25 to 30 percent quad and 50 to 55 percent dual. Single-cored SoCs would drop to less than 5 percent he said.

With the trend towards multi-cored SoCs at 64-bit rather than 32-bit and with LTE there is scope for increased average selling prices. MediaTek is also looking to sell its chips outside China to a greater extent. These are all factors that can help MediaTek results in the second half of 2013.

MediaTek is also planning to introduce a platform to address wearable equipment and the Internet of Things in the third quarter of 2014, according to a Digitimes report that referenced unnamed sources.

The platform is called Aster and will include ICs, software, firmware and reference designs. The Aster SoC will integrate a microcontroller core with Bluetooth transceiver, touchscreen controller memory and I/O interfaces and is designed to be compatible with MediaTek's smartphone and tablet chips, the report said. Aster-based products are expected to hit the market in the second half of 2014.

Related links and articles:

www.mediatek.com

News articles:

MediaTek to Integrate Wolfson Audio

Marvell Includes LTE in 64-bit Apps Processor

MediaTek Deploys Cortex-A7 in Octa Chip

ARM Respins Cortex-A15 for Mid-Tier Smartphones



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