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MediaTek Inc. says 2012 fourth-quarter revenue down 10%

TAIPEI, Taiwan -- Total 2012 fourth-quarter revenue for MediaTek Inc. (聯發科), a major Taiwanese handset chip designer, decreased around 10 percent, according to statistics released at its investors' conference, yesterday.

Compared with the third quarter of 2012, fourth-quarter net profit decreased around 9 percent to NT$4.88 billion, while revenue in the fourth quarter finished at NT$26.73 billion.

This result was worse than the company's third quarter forecast, which anticipated a decrease of around 2 to 5 percent.

The company's consolidated revenue for 2012 was NT$99.26 billion, MediaTek said. Year-on-year consolidated revenue grew 14.33 percent, it said.

Earnings Per Share (EPS) for the fourth quarter was NT$3.7, while the accumulated EPS for the whole year was NT$12.9. The net profit for all four quarters of 2012 was NT$15.68 billion.

Inventory issues were the main factor behind the profit decline, the firm said, with declining demand from the Chinese market also playing a part.

The company said in order to decrease its product inventory while reducing the negative effects of sales, it will reduce the price of some products by 10 percent. This may decrease gross growth in the first quarter of 2013, and the firm will only be able to achieve positive growth in the second quarter of 2013, said the company.

While noting that they have been enjoying growing market demand for their smartphones and the new 4G Long-term Evolution (LTE) service, the company said they have still faced strong pricing competition from the rapidly growing manufacturing sectors in China and Latin America.

The company said that to successfully reduce its inventory, it plans to cut prices for chip products by between 5 and 15 percent. The average price for a range of its chipsets, such as MT6515, MT6575 and MT6577, may drop 10 percent, said the company.

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