MediaTek Q3 net income rises 10.8% as first AI accelerator heads for $2.5 billion in Q4 revenue

Taiwan's largest chip designer, MediaTek, reported third-quarter results on October 30: revenue of NT$168.1 billion (about $5.16 billion), up 18.3% from a year earlier, and net income of NT$28.2 billion, up 10.8%. Chief Executive Rick Tsai told the earnings call that demand growth for AI will continue 'for sure', although the rate may vary.

First AI accelerator shipping; second targeted for 2028 volume production

Tsai said demand for the company's first AI accelerator remains strong, with initial shipments starting last month and expected to generate $2.5 billion of revenue in the fourth quarter. High-volume production of its second AI accelerator project is on track for the first quarter of 2028. MediaTek has been reducing its reliance on smartphones and aims to become a significant supplier of custom AI chips to major cloud providers.

Nvidia's $3.5 billion investment; TSMC remains a key partner

MediaTek said in August it issued a record $3.9 billion in overseas convertible bonds, of which Nvidia invested $3.5 billion. MediaTek, a customer of the world's largest contract chipmaker TSMC, is the second-most valuable company on the Taiwan stock exchange, with a market capitalisation of about $200 billion. Its shares closed down 3.2% on Friday ahead of the results.

What comes next

Investors will now watch whether the first AI accelerator delivers its expected fourth-quarter revenue, and whether the second product reaches volume production on schedule in the first quarter of 2028, which will set the pace of MediaTek's shift from smartphone chips toward AI infrastructure.