China's brand-name handset vendors, including Lenovo, ZTE and TCL, have ordered more MT6573 3.75G smartphone chips from MediaTek, according to industry sources. To meet the continued rising demand, the fabless IC firm has asked for additional foundry capacity equivalent to 6,000-8,000 12-inch wafers from United Microelectronics Corporation (UMC), the sources indicated.
Backend service providers including Advanced Semiconductor Engineering (ASE), Siliconware Precision Industries (SPIL), King Yuan Electronics (KYEC) and Sigurd Microelectronics are also pinpointed by the sources as beneficiaries of the increased orders.
MediaTek released additional orders to UMC as well as Taiwan Semiconductor Manufacturing Company (TSMC) for foundry services in August – equivalent to a combined 25,000 12-inch wafers – to satisfy brisk demand for its MT6573 solution, which is gaining acceptance from the company's principal customers in China, the sources revealed.
MediaTek is expected to see monthly shipments of its MT6573 chipset solutions to reach 1-1.5 million units in October and November, and continue expanding to 3.5-4 million in December, the sources estimated. The growing shipments will boost the company's sales in the fourth quarter of 2011, the sources said.
In addition, acknowledging the MT6573's popularity, Huawei Technologies reportedly is asking MediaTek to accelerate development of the chip's successor, the sources said. Dubbed the MT6575, the next-generation single-chip solution could start shipping as early as the first quarter of 2012, the sources indicated.
MediaTek shares closed up 2% at NT$336 (US$11.10) on the Taiwan Stock Exchange on October 13. The price scored the highest in eight trading days.
In other news, ASE, SPIL, KYEC and Sigurd are likely to see their revenues for the fourth quarter of 2011 stay flat sequentially, the best-case scenario amid a global economic downturn, according to the sources. Orders from MediaTek as well as the depreciation of the NT dollar are seen as the major contributing factors.