Chinese handset chipmaker Spreadtrum Communications Inc (展訊) yesterday said its revenue would grow more than 20 percent annually to US$1.45 billion this year.
“We had a record-high revenue in the second quarter by growing 13 percent quarter-on-quarter and 16 percent year-on-year,” chairman and chief executive officer Leo Li (李力游) said at the annual Global Semiconductor Alliance (GSA) forum in Hsinchu.
Amid weakening demand for mobile phones, Hsinchu-based Media-Tek Inc (聯發科) saw revenue drop 1 percent annually in the second quarter, while US-based Qualcomm Inc reported a 15 percent decline in its sales for that period.
“We believe we will achieve our projection of over 20 percent growth this year,” Li said.
TSINGHUA CONNECTION
Spreadtrum, which is owned by China’s Tsinghua Unigroup Inc (清華紫光), reported revenue of US$1.16 billion last year.
About 90 percent of its revenue came from overseas customers, Li said.
The company has been growing its business along with its major customer, China Mobile Ltd (中國移動), and is looking to expand its business to the US, Latin America, Southeast Asian and India, Li said.
Spreadtrum is catching up with rivals in terms of product shipment and technological advancement, he said.
It shipped 450 million handset chips last year, taking 22 percent of the global market, and the figures are expected to rise to about 500 million units this year, Li said.
MediaTek shipped 650 million chips last year.
In terms of the strength of its technology portfolio, Spreadtrum plans to ship its first 16-nanometer chip in the second quarter of next year at the earliest, Li said.
That will be one quarter faster than MediaTek as Spreadtrum has skipped 20nm technology.
CATCHING UP
Spreadtrum has lagged rivals by a decade in 2G wireless technology, but reduced the gap by five years in developing 3G and by 2 years in 4G, Li said.
However, it will compete head-to-head in the 5G technology in 2020, he said.
Spreadtrum has so far hired 4,000 engineers, far fewer then MediaTek’s 15,000 engineers and Qualcomm’s 32,000, Li said.
The company could have a better net profit margin than its bigger rivals because it has lower operating expenses, even though Spreadtrum’s gross margin stood at 35 percent last quarter, compared with the 40 percent to 50 percent of its rivals, he said.
Li declined to answer reporters’ questions on whether the company would merge with MediaTek after Tsinghua Unigroup chairman Zhao Weiguo (趙偉國) expressed a keen interest last week in such a deal.
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