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MediaTek seeking to calm worries on chip demand through Q2

TAIPEI--Leading integrated circuit designer MediaTek Inc. (聯發科) forecast Wednesday that global demand for cellphone chips will likely remain stable through the second quarter, though chips for optical storage and personal computers are likely to continue to feel the pinch of slow season effects.

Cellphone chips, including those used in smartphones, account for more than 60 percent of MediaTek's total sales.

The IC designer made its prediction in response to market speculation that it could see consolidated sales for the second quarter fall from the first quarter.

Concerns over second quarter sales momentum left shares of MediaTek down 2.87 percent to NT$440 as of yesterday, with 9.35 million shares changing hands. Taiwan shares closed down 42.48 points, or 0.48 percent, at 8,689.46.

MediaTek said it will give sales guidance and a market outlook for the second quarter in an investor conference scheduled for April 30, when the IC designer will release its first quarter results.

In the first two months of this year, MediaTek recorded NT$28.58 billion in consolidated sales, up 96.47 percent after the company completed a merger deal with former smaller rival MStar Semiconductor Inc. (晨星半導體) on Feb. 1.

The merger has raised MediaTek's consolidated sales estimate for the first quarter to NT$41.4 billion-NT$44.6 billion from an earlier NT$35 billion-NT$39 billion.

The revised estimate is a 4-12 percent increase from a quarter earlier, while the previous estimate represented a 2-10 percent sequential decline.

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