At a conference held on July 31, MediaTek announced the imminent availability of its latest flagship AI accelerator chips, the Dimensity 9400. MediaTek CEO Rick Tsai said the company is committed to becoming the “partner of choice” in edge AI. focusing on advanced technologies and 3nm process technology to optimize the power consumption and efficiency of its SoCs.
Image source: MediaTek
Tsai said MediaTek will unveil its flagship Dimensity 9400 series of chips in October, supporting most of the major language models in the market, and therefore he expects revenue to increase by more than 50% year-on-year. MediaTek also confirmed the development of ASICs with integrated artificial intelligence accelerators. The new ASICs are expected to begin generating revenue in the second half of next year.
According to MediaTek, the market capacity for generative AI devices is far from being exhausted, and the market itself is at an early stage of its development. The company plans to focus on developing internetworking technologies such as SerDes IP and Ethernet PHY.
Tsai noted that flagship smartphones with AI are showing a steady increase in average selling price (ASP), and in the Chinese market there is a gradual shift towards the most advanced models. Chinese brands are actively introducing AI into their devices, mainly through open-source models such as LLaMA 3.
Revenue in the second quarter of 2024 was $3.87 billion, for the third quarter MediaTek forecasts gross revenue in the range of $3.75 billion to $4 billion. Third quarter gross profit is forecast to decline to 45.5-48.5% from 48. 8%, down 3.6 percentage points quarter-on-quarter but up 1.3 percentage points year-on-year. Annual gross margins will be between 46% and 48%, and revenue growth from the launch of Dimensity 9400 will have little impact on financial results.
MediaTek has secured its 2025 3nm and 2nm semiconductor manufacturing needs with TSMC. TSMC’s price increases were offset by setting a gross margin target of 47% for new MediaTek products.
MediaTek is collaborating with Nvidia in the field of automotive electronics, the companies plan to release the first jointly developed chip in early 2025. MediaTek expects “significant progress in the automotive sector” in 2027-2028.
MediaTek expects a return to normal seasonal trends in the second half of the year, with the fourth quarter shipment outlook largely dependent on demand for consumer products.