Credit Suisse expects MediaTek's revenue to decline by only 7% in the second quarter

Beijing April 19 news, Credit Suisse Securities today released the latest report, forecast MediaTek revenue growth of only 7% in the second quarter, the performance is lower than previous levels, but also lower than the original estimate of Credit Suisse's 13%, Credit Suisse believes that MediaTek will continue to maintain its aggressive pricing strategy in the second quarter to stabilize its market share ahead of rival Spreadtrum’s launch of new chips, and it is expected that its revenue performance will remain weak.

MediaTek started operating in the first quarter of this year and entered a weak situation. The progress of new chip shipments is not as smooth as originally expected. Credit Suisse believes that MediaTek's gross profit margin in the first quarter is expected to stabilize, but MediaTek is still taking a positive attitude toward chip prices in the second quarter. The gross profit margin will decline again from the first quarter, with an estimated 45%.

As for the progress of MediaTek’s high hopes for smart phone chips this year, Credit Suisse believes that due to the fact that the market has not reached a large number of growth periods, it will not be able to ship a lot this year. It is estimated that Mediatek’s smart phone chip shipments will reach approximately 12 million this year, It can be up to several times the rate of increase, and is expected to ship about 60 million.

However, Credit Suisse still lowered MediaTek’s operating forecast for the next two years, affected by the slowdown in 2.5G market growth, and the limited contribution of smartphones to revenue. It is expected that MediaTek’s earnings per share will fall below the average market expectation for the next two years.

MediaTek’s share price continued to decline today, and it once fell below half-cuts to stop at a new low for nearly two years.

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