MediaTek, which enjoyed stronger-than-expected revenue growth in the second quarter of 2016, will see its revenues grow at a slower pace in the second half of the year, according to industry sources.

MediaTek has announced pre-tax profits of NT$7.75 billion (US$245.2 million) for the second quarter of 2016, up 46.8% sequentially. Pre-tax EPS for the quarter came to NT$4.93.

MediaTek generated consolidated revenues of NT$72.53 billion in the second quarter, up 29.7% on quarter, which met the high-end of the company's guidance. The results were also a record high. The company posted operating profits of NT$7.07 billion in the second quarter, up 60.6% sequentially with operating margin rising 1.86pp on quarter to 9.74%.

Market watchers expect MediaTek to enjoy another quarter of record revenues in the third quarter.

Market watchers generally believe that MediaTek will post another double-digit revenue growth sequentially for the third quarter. However, with the chip firm's clients becoming less-aggressive about placing orders, MediaTek is likely to see its third-quarter revenues register a smaller-than-expected sequential increase, the sources indicated.

In addition, with Qualcomm and Spreadtrum developing counter-strategies to gain a competitive advantage, MediaTek will move to defend its market share in the second half of 2016, the sources indicated. Meanwhile, improving its gross margin will be the Taiwan company's focus, the sources said.

MediaTek is scheduled to hold an investors meeting on August 3.

By: DocMemory
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