MediaTek is expected to post more than 20% sequential revenue growth in the second quarter, with higher margins, driven by a pick-up in orders from its China-based handset clients, according to market watchers.

Sales of MediaTek's Helio P60 chips with built-in AI support and other new products will buoy further the company's sales performance in the second half of 2018, the watchers indicated.

Nevertheless, MediaTek is likely to be more cautious than market watchers about its outlook for the second quarter. The company may provide a growth estimate of 15-25% for the quarter, the watchers said.

The transition from old to new mobile SoCs, as well as seasonal factors, dragged down MediaTek's overall chip shipments in the first quarter, the watchers noted. However, shipments are set to register substantial growth in the second quarter, driven mainly by robust demand for the company's AI-capable smartphone chip, the watchers said.

MediaTek saw its March revenues return to over NT$20 billion (US$680.8 million). Revenues came to NT$49.65 billion for the first quarter of 2018, down 17.8% sequentially but meeting the company's guidance.

MediaTek is scheduled to hold its quarterly investors meeting on April 27.

MediaTek CEO Rick Tsai reiterated previously MediaTek's mobile chip focus for 2018 on its Helio P series designed for mid-range and higher mid-range devices. MediaTek will also put increased focus on non-mobile SoCs mainly those for IoT and automotive electronics applications, which will help the company improve further its gross margin and buoy its revenue and profit performance, Tsai said.