Revenue & profit dollars beat, but bulls/bears fight over GM
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The strong revenue and profit dollars in 1H16 is a positive, but offset by disappointing guidance for 2Q16F GM. Granted, the lower than expected GM in 2Q16F is mainly due to an unfavorable product-mix, as low-end phones are growing fast. All in all, while bulls and bears will continue to debate over GM outlook in 2H16F and 2017F, we still believe that its product portfolio’s enhancement is moving in the right direction. 1Q16 revenue/GM were in line with guidance. One bright spot is improvement in op profit, as OPM rose nearly 200 bps to 8%, but was somehow offset by higher tax. EPS was NT$2.8, flat QoQ.
Mediatek is engaged in the research, development, manufacture and sales of multi-media integrated circuit ("IC"), IC for computer peripherals, IC for advanced consumer electronics, IC for other special applications and decoders of optical storage; software application design, testing, maintenance and technical consultation services for IC; the import and export of products related to IC. Co.'s product items include optical storage chipset; CD-ROM chipset and single chip, DVD-ROM chipset and single chip, CD-R/RW chipset, combi chipset; and advanced digital consumer chipset DVD-Player chipset (RF chip, servo controller chip and highly integrated chip).
Yuanta is a Taiwan-headquartered brokerage with a growing presence in Asia, especially across Greater China. Our team of 140+ provides cutting-edge analysis on key sectors, spread across offices in Taiwan, Hong Kong, Shanghai (A-Share), Seoul and Jakarta. With an ever-expanding coverage universe of 400+ companies, we provide in depth analysis with unique local color to investors. Consistently being voted the Best Investment Consulting Firm in Taiwan in the AsiaMoney broker poll is evidence of our strength. We target providing an extensive range of research, from small, to mid-sized, to large cap. We bring you the big, well-covered names, as well as going off the beaten track to research the less-familiar companies.
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