MediaTek (2454) Q2 2026 earnings summary

Executive summary

• Second quarter revenue reached TWD 152.2 billion (NT$152,183 million), up 2% sequentially and 1.2% year-over-year, exceeding guidance due to Smart Edge platform momentum and product launches.

• Net income was TWD 24.6 billion (NT$24,605 million), up 0.9% sequentially but down 12.3% year-over-year; EPS was TWD 15.28, up from last quarter but down from a year ago.

• Data center business is scaling rapidly, with first AI accelerator ASIC production set for Q4 and revenue expected to exceed $2 billion in 2026; market share target for data center raised to 15%-20% for 2027.

• Consolidated financial statements for H1 2026 reviewed with no material misstatements; company operates as a single segment focused on IC design for multimedia and mobile chips.

Financial highlights

• Gross margin was 46.2%, near guidance midpoint, down 0.1 ppt sequentially and 2.9 ppt year-over-year; operating income was TWD 22.9 billion, nearly flat sequentially but down 22.2% year-over-year.

• Net profit margin was 16.2%, down 0.1 ppt sequentially and 2.5 ppt year-over-year; non-TIFRS net income was NT$25,305 million, margin 16.6%.

• H1 2026 net sales were NT$301,333 million, down 0.8% year-over-year; net income for H1 2026 was NT$48,981 million, down 16.9% year-over-year.

• Basic EPS for H1 2026 was NT$30.44, down from NT$35.92 in H1 2025.

Outlook and guidance

• Q3 revenue expected between TWD 152.2 billion and TWD 159.8 billion, flat to up 5% sequentially, and up 7%-12% year-over-year; gross margin forecasted at 46% ±1.5 ppt.

• Full-year revenue target at high end of guidance, aiming for high single-digit % growth in USD; gross margin for the year expected within current quarter guidance range.

• Management highlighted risks from competitive pricing, supply-demand shifts, regulatory changes, and global economic conditions.

• The company expects to complete service contracts within 1-2 years, with NT$13,804 million in unsatisfied performance obligations as of June 30, 2026.