Technology / Semiconductor / Internet Research

Nicolas Baratte

Equity Bottom-Up

<ul>
<li>Mediatek beats in 1Q, good guidance for 2Q, but close to Consensus. Several positives in 2025: flagship smartphone gains, smartphone AI upgrades, strong WiFi and Connectivity growth, progress in Auto.</li>
<li>How large is the “sizable revenue” opportunity of data center custom ASICs from 2026? Management sounds increasingly positive / confident. The stock valuations reflect this.</li>
<li>The stock trades at 18.5x 2025 EPS, 15.5x 2026 EPS, not extravagant but on the high-end. If you have the stock, keep it. If you don’t, TSMC looks more interesting.  </li>
</ul>


Mediatek beats in 1Q, good guidance for 2Q, but close to Consensus. Several positives in 2025: flagship smartphone gains, smartphone AI upgrades, strong WiFi and Connectivity growth, progress in Auto.
How large is the “sizable revenue” opportunity of data center custom ASICs from 2026? Management sounds increasingly positive / confident. The stock valuations reflect this.
The stock trades at 18.5x 2025 EPS, 15.5x 2026 EPS, not extravagant but on the high-end. If you have the stock, keep it. If you don’t, TSMC looks more interesting.  


Mediatek 1Q25 6% Beat, Growth Accelerating in 2Q, Large Revenue Opportunity for Data Center ASIC

Managing Director, Zero One, Zero One

Vincent Fernando, CFA

Managing Director, Zero One

Zero One

Founded in 2015, Zero One produces independent investment research and provides corporate finance advisory services with a focus on both listed and private technology companies. Founder Vincent Fernando has over 20 years of experience in US and Asia capital markets.

Independent Investment Research

<ul>
<li>
MediaTek beat 1Q25 EPS expectations as Smart Edge and mobile segments delivered strong sequential growth; flagship SoC traction supports improved ASP mix.</li>
<li>
AI remains central to strategy: NVIDIA partnership progressing -- NT$1bn AI ASIC revenue targeted for 2026.</li>
<li>
Tariff-Driven macro caution clouds 2H outlook, but we maintain Structural Long view -- AI, auto, and premium mobile SoCs drive long-term opportunity.</li>
</ul>



MediaTek beat 1Q25 EPS expectations as Smart Edge and mobile segments delivered strong sequential growth; flagship SoC traction supports improved ASP mix.

AI remains central to strategy: NVIDIA partnership progressing -- NT$1bn AI ASIC revenue targeted for 2026.

Tariff-Driven macro caution clouds 2H outlook, but we maintain Structural Long view -- AI, auto, and premium mobile SoCs drive long-term opportunity.


MediaTek 1Q25 Earnings: AI Momentum Drives Strength, But 2H Visibility Remains Murky Due to Tariffs

Taiwan Tech Focused Senior Analyst

Patrick Liao

<ul>
<li>2Q25 guidance is projected to be between NT$147.2bn and NT$159.4bn (midpoint-flat QoQ), with a gross margin expected to range between 45.5% and 48.5%, and operating expenses between 27% and 31%. </li>
<li>In 2Q25, MediaTek expects mobile to be flat to slightly down, continued QoQ growth in smart edge, and QoQ growth in power ICs. </li>
<li>Regarding flagship smartphone SoCs, MediaTek remains optimistic about gaining market share and expects the ASP (average selling price) of its next-generation flagship chips to continue rising.</li>
</ul>


2Q25 guidance is projected to be between NT$147.2bn and NT$159.4bn (midpoint-flat QoQ), with a gross margin expected to range between 45.5% and 48.5%, and operating expenses between 27% and 31%. 
In 2Q25, MediaTek expects mobile to be flat to slightly down, continued QoQ growth in smart edge, and QoQ growth in power ICs. 
Regarding flagship smartphone SoCs, MediaTek remains optimistic about gaining market share and expects the ASP (average selling price) of its next-generation flagship chips to continue rising.


MediaTek (2454.TT): Tariffs Are Highly Uncertain, but Client Purchasing Hasn’t Changed Much.

<ul>
<li>1Q15 Smartphone units up 1.5-3% YoY but given accelerated imports to US and Chinese consumer subsidies, end-demand was probably flat YoY. TSMC 1Q25 revenues suggest that Smartphone chips declined YoY.</li>
<li>We should expect a correction in 2H25 and overall flat 2025 YoY.</li>
<li>The only positive is that chips are getting bigger (AI cores) and more expensive (3nm) and hence positive to Mediatek and Qualcomm, but not to phone Brands Apple included.</li>
</ul>


1Q15 Smartphone units up 1.5-3% YoY but given accelerated imports to US and Chinese consumer subsidies, end-demand was probably flat YoY. TSMC 1Q25 revenues suggest that Smartphone chips declined YoY.
We should expect a correction in 2H25 and overall flat 2025 YoY.
The only positive is that chips are getting bigger (AI cores) and more expensive (3nm) and hence positive to Mediatek and Qualcomm, but not to phone Brands Apple included.


Smartphone Market Grew 2% in 1Q25 with 2 Positives Boosters: Apple Restocking in US, China Subsidies

<ul>
<li>The Stakes in the 6G Race: 100x Data Speeds &amp; AI-Driven Networks</li>
<li>Qualcom's Strategy vs. Mediatek's Gameplan to Win the 6G Battle -- Takeaways from MWC 2025 in Barcelona</li>
<li>Investment Takeaways: MediaTek vs. Qualcomm -- Maintain Structural Long for Mediatek but Qualcomm Could Offer Near-Term Relative Value Play</li>
</ul>


The Stakes in the 6G Race: 100x Data Speeds &amp; AI-Driven Networks
Qualcom's Strategy vs. Mediatek's Gameplan to Win the 6G Battle -- Takeaways from MWC 2025 in Barcelona
Investment Takeaways: MediaTek vs. Qualcomm -- Maintain Structural Long for Mediatek but Qualcomm Could Offer Near-Term Relative Value Play


MWC Barcelona Showcased The 6G Showdown: MediaTek Vs. Qualcomm in the Race for Wireless Supremacy

Taiwan

MediaTek Inc. is a fabless semiconductor company for wireless communications and digital multimedia solutions. The company provides SOC system solutions for wireless communications, high-definition TV, optical storage, DVD and Blu-ray products.

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Mediatek Inc (2454 TT)

Mediatek 1Q25 6% Beat, Growth Accelerating in 2Q, Large Revenue Opportunity for Data Center ASIC

Mediatek's strong performance in 1Q and positive outlook for 2Q, with potential growth in flagship smartphones, AI upgrades, and connectivity, but...

Nicolas Baratte

MediaTek 1Q25 Earnings: AI Momentum Drives Strength, But 2H Visibility Remains Murky Due to Tariffs

MediaTek surpasses 1Q25 EPS expectations with strong growth in Smart Edge and mobile segments. Tariff concerns impact 2H outlook, but long-term...

Vincent Fernando, CFA

MediaTek (2454.TT): Tariffs Are Highly Uncertain, but Client Purchasing Hasn’t Changed Much.

MediaTek projects steady revenue and margin for 2Q25, with flat mobile sales but growth in smart edge and power ICs, while remaining optimistic...

Patrick Liao

Smartphone Market Grew 2% in 1Q25 with 2 Positives Boosters: Apple Restocking in US, China Subsidies

1Q15 slight increase in smartphone units, but end-demand likely remained flat. Expect a correction in 2H25 with overall flat 2025 YoY. Positives...

Nicolas Baratte

MWC Barcelona Showcased The 6G Showdown: MediaTek Vs. Qualcomm in the Race for Wireless Supremacy

MWC 2025 in Barcelona earlier this week showed the race for 6G dominance heating up as Qualcomm and MediaTek strategize for faster data speeds and...

Vincent Fernando, CFA

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Market Cap (USDm)

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Mediatek 1Q25 6% Beat, Growth Accelerating in 2Q, Large Revenue Opportunity for Data Center ASIC

​Mediatek's strong performance in 1Q and positive outlook for 2Q, with potential growth in flagship smartphones, AI upgrades, and connectivity, but...

Nicolas Baratte

MediaTek 1Q25 Earnings: AI Momentum Drives Strength, But 2H Visibility Remains Murky Due to Tariffs

​MediaTek surpasses 1Q25 EPS expectations with strong growth in Smart Edge and mobile segments. Tariff concerns impact 2H outlook, but long-term...

Vincent Fernando, CFA

MediaTek (2454.TT): Tariffs Are Highly Uncertain, but Client Purchasing Hasn’t Changed Much.

​MediaTek projects steady revenue and margin for 2Q25, with flat mobile sales but growth in smart edge and power ICs, while remaining optimistic...

Patrick Liao

Smartphone Market Grew 2% in 1Q25 with 2 Positives Boosters: Apple Restocking in US, China Subsidies

​1Q15 slight increase in smartphone units, but end-demand likely remained flat. Expect a correction in 2H25 with overall flat 2025 YoY. Positives...

Nicolas Baratte

MWC Barcelona Showcased The 6G Showdown: MediaTek Vs. Qualcomm in the Race for Wireless Supremacy

​MWC 2025 in Barcelona earlier this week showed the race for 6G dominance heating up as Qualcomm and MediaTek strategize for faster data speeds and...

Vincent Fernando, CFA

Mediatek's strong performance in 1Q and positive outlook for 2Q, with potential growth in flagship smartphones, AI upgrades, and connectivity, but...

MediaTek surpasses 1Q25 EPS expectations with strong growth in Smart Edge and mobile segments. Tariff concerns impact 2H outlook, but long-term...

MediaTek projects steady revenue and margin for 2Q25, with flat mobile sales but growth in smart edge and power ICs, while remaining optimistic...

1Q15 slight increase in smartphone units, but end-demand likely remained flat. Expect a correction in 2H25 with overall flat 2025 YoY. Positives...

MWC 2025 in Barcelona earlier this week showed the race for 6G dominance heating up as Qualcomm and MediaTek strategize for faster data speeds and...