On January 31, MediaTek, a major mobile phone chip manufacturer, held a legal conference and announced its fourth quarter and annual results for 2023. This is mainly due to the strong sales growth of the Dimensity series flagship chips represented by the Dimensity 9300.
In the fourth quarter, mobile phone revenue surged 53% quarter-on-quarter
MediaTek's revenue for the fourth quarter of 2023 was NT$1,2956.2 billion yuan, an increase of 177%, a year-on-year increase of 197%；Gross margin was 483%, an increase of 09 percentage points, the same as the same period in 2022;Net income attributable to shareholders of the parent company was NT$2571.3 billion yuan, an increase of 38 percent month-on-month5%, a year-on-year increase of 389%, and earnings per share were NT$1615 yuan, reaching a new high in the past five quarters.
MediaTek pointed out that benefiting from the growth of 5G and 4G demand, as well as the volume of the flagship chip Dimensity 9300, the revenue of the mobile phone business in the fourth quarter of last year rose by 53% quarter-on-quarter, accounting for 64% of the overall revenueThe smart device platform accounted for about 30% of the revenue in the fourth quarter of last year, and the performance fell by nearly 20% quarter-on-quarter, mainly because TV customers had established inventory in advance and reduced orders in the first half of last yearIn terms of power management ICs, the proportion of revenue in the fourth quarter of last year was 6%, and the revenue showed a slight increase of 1% quarter-on-quarter. Data center power management IC revenue grew strongly in the fourth quarter.
Affected by the decline in overall market demand, MediaTek's consolidated revenue for the full year of 2023 was NT$4,3344.6 billion yuan, down 21% year-on-year, ending the performance growth trend for four consecutive years, and the annual gross profit margin increased from 49 in 20224% also dropped to 478%。Net profit attributable to shareholders of the parent company was NT$7719.1 billion yuan, down 34 percent year-on-year9%, and earnings per share were NT$4851 yuan. R&D expenses for the full year amounted to NT$111.3 billion, down only slightly from NT$116.8 billion in 2022.
MediaTek CEO Cai Lixing said that this year's global smartphone market shipments will only grow by a low-single-digit percentage to a total of about 1.2 billion units, while the penetration rate of 5G mobile phones will increase from 57% to 59% last year to 61% to 63%. For MediaTek, 2024 will be a year of growth and the beginning of the next growth phase.
Last year, the revenue of Dimensity's flagship mobile phone chips soared by 70%, with revenue exceeding $1 billion
Looking ahead to the first quarter of 2024, MediaTek expects revenue growth to be strong compared to the same period last year, mainly reflecting a more normalized inventory status compared to the same period last year, with a slight decline compared to the previous quarter. Revenue is expected to be 1:31 in USD/TWD2 Revenue will be between NT$121.8 billion and NT$129.6 billion, which is roughly the same as the previous quarter to a decrease of about 6%, but will still increase by 27% to 35% from the same period last year. Gross margin is expected to be 47% plus or minus 15 percentage points, the full-year gross profit margin is expected to remain within the range of the gross profit margin target in the first quarter.
Cai Lixing pointed outLast year, MediaTek's flagship mobile phone chip revenue grew strongly by 70%, contributing more than $1 billion in revenue. The latest flagship chip, the Dimensity 9300, has received quite positive feedback from the market, and its market share will continue to increase. Flagship phones including vivo, OPPO and iQOO all use the Dimensity 9300 to provide generative AI functions on the mobile phone, and the generative AI will also be imported into the high-end chip Dimensity 8300.
Cai Lixing mentioned that MediaTek has observed that generative AI not only drives the demand for mobile phone upgrades, but also drives the growth of the overall flagship and high-end mobile phone market. The continuous upgrade of global 5G and the expansion of the market share of flagship mobile phone chips will be an important driving force for the mobile phone business this year. However, mobile phone revenue in the first quarter will show a slight quarterly decrease from the previous quarter after strong demand in the fourth quarter of last year.
It is worth mentioning that MediaTek also plans to introduce generative AI into tablets and other devices, and MediaTek's many tablet customers have used the Dimensity 9300 to build flagship tablets that support generative AI in the first quarter, and more models are expected to be introduced in the future.
In terms of other businesses, despite the weak overall consumer electronics demand in 2023, De's 5G baseband chips, automotive electronics and ASIC businesses continued to grow. MediaTek expects the overall market demand to improve moderately in 2024, and the growth in demand for wireless and wired networking and computing equipment upgrades will also be an important growth driver.
MediaTek announced the start of Wi-Fi 7 certification in the Wi-Fi Alliance, and then announced the first batch of certified Wi-Fi 7 solutions at this year's CES, and a number of customers have launched products using MediaTek Wi-Fi 7, which leads the industry to market position MediaTek continues to increase market share in high-end consumer routers, high-end laptops, broadband devices, etc.
Overall, in the first quarter of 2024, growth from TVs, tablets and broadband is expected to offset the seasonal decline in smartphones and other consumer electronics, and smart device platform revenue is expected to be slightly flat compared to the previous quarter. In terms of power management ICs, revenue is expected to decline from the prior quarter due to seasonality and the transition phase of some products. MediaTek said that in 2024, it will continue to expand in new areas such as automotive and data centers to drive business growth.
In addition, MediaTek also announced yesterday the implementation of a dual chief operating officer system. General Manager Chen Guanzhou will also serve as Chief Operating Officer with immediate effect, and Executive Vice President and Chief Financial Officer Gu Dawei will be added to the position of Co-Operating Officer.
It is understood that MediaTek implements a dual operating chief system, mainly to examine the growth of global operation scale and strengthen the structure of the management team, so as to more effectively achieve the group's medium and long-term strategic goals. In recent years, in addition to the original financial and global marketing work, Gu Dawei has assisted Cai Lixing and Chen Guanzhou to work for a period of time in the field of global automotive market development, production capacity and advanced process management.
Editor: Xinzhixun-Rogue Sword.