MediaTek, the fabless semiconductor chipmaker based out of Hsinchu, Taiwan, has released its financial statement for the month of November 2016. According to the announcement, the company, last month earned consolidated revenues of NT$23.52 billion ($739.9 million), which is the lowest it has been in seven months. However, calculated on a year-on-year basis, the revenue growth actually looks pretty healthy with a 12.2% increase over November 2015. That being the case, the company’s consolidated revenues for the first eleven months of this year now stands at NT$254.2 billion ($8.025 billion), which is a massive 30.5% jump from the same period last year. MediaTek, however, has cautioned investors that it is likely to underperform in the current quarter because of supply-side issues and slowing consumer demand in China.
With the foundries unable to come up with 28nm chips and consumer demand in its largest market softening significantly, the company earlier said that it expects to post fourth quarter revenues of between NT$66.6 billion ($2.1 billion) and NT$72.9 billion (2.3 billion), which would be a decline of between 7-15% on a sequential basis. That’s because the company had earned revenues of NT$78.4 billion ($2.48 billion) in the past quarter with a gross margin of 35.2%. However, even though its looks fairly healthy on paper, the overall margins were still down about 7.5% YoY. It remains to be seen how long it takes before supply constraints will ease at foundries like TSMC (Taiwan Semiconductor Manufacturing Company), and if MediaTek’s struggles will continue until then.
Back in August, however, MediaTek revised its guidance upwards, saying that it expects its consolidated revenues for 2016 to increase by 25% YoY. The company has also been putting more emphasis in other markets in the region because of the Chinese smartphone market hitting a saturation point. India, of course, is one such country where MediaTek has experienced significant growth recently, and the company recently said that it expects a larger share of its profits to come from the country going forward. With low-cost, high-performance chips like the Helio X35 said to be in the pipeline for 2017, the company will be hoping that the foundries will be able to sort out their problems sooner rather than later, so that it doesn’t have to lost any more business to rivals going forward.