MediaTek sees nearly 10% annual revenue growth despite likely Q2 setback

Taipei, April 30 (CNA) Taiwan-based IC designer MediaTek Inc. said Thursday its revenue in the second quarter of 2026 is expected to be flat or decline amid cautious market demand, but the company still expects its annual growth rate to reach nearly 10 percent.

At an online investor conference, MediaTek projected second-quarter revenue of between NT$140.2 billion (US$4.43 billion) and NT$149.2 billion, ranging from flat growth to a 6 percent decline from the first quarter, and a 1-7 percent drop from a year earlier.

The company reported first-quarter revenue of NT$149.15 billion, down 0.7 percent from the previous quarter due to weaker smartphone chip sales.

Gross margin in the first quarter rose 0.2 percentage points from the fourth quarter of 2025 to 46.3 percent, while net profit attributable to the parent company increased 5.36 percent to NT$24.15 billion, with earnings per share of NT$15.17, supported by a more favorable product mix.

CEO Rick Tsai (蔡力行) said customer demand remains cautious in the near term, while a shift in resources toward data center development has raised costs in the smartphone industry, leading to increased product pricing.

Global smartphone shipments are expected to decline by about 15 percent this year, he added.

Nevertheless, MediaTek said it expects a recovery in its mobile chip business in the second half of the year as flagship smartphones powered by the company's 2-nanometer chips are set to launch late in the third quarter.

Meanwhile, the company's smart device platform, which spans connectivity, computing and automotive applications, is expected to achieve double-digit growth this year, supported by market share gains and rising DRAM prices for some TV chips, he said. The forecast excludes contributions from application-specific integrated circuits (ASICs) for data centers.

Revenue from power management ICs is expected to remain largely flat in the second quarter.

Despite near-term headwinds, Tsai said the company aims to maintain full-year gross margin within the second-quarter guidance range of 44.5-47.5 percent through disciplined pricing strategies.