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MediaTek Strengthens Premium Push With Gen AI Capabilities

  • The Dimensity 9300 is integrated with the 7th-gen APU 790 processor, which supports a broad generative AI ecosystem and models including Meta Llama 2, Baidu ERNIE 3.5 SE and Baichuan 2.
  • It can run with 13 billion parameters, which are scalable up to 33 billion, on-device at a processing speed of up to 20 tokens per second.
  • The Dimensity 9300 will debut with the vivo X100 smartphone in mid-November

MediaTek recently launched its third-generation premium chipset Dimensity 9300. The company has emerged as a strong competitor in the premium smartphone chipset market after launching the Dimensity 9000 in Q1 2022. Currently, MediaTek leads the low-mid segment and drives significant volumes both for 4G and 5G in this tier.
Adopting a non-traditional CPU core design, the Dimensity 9300 focuses on raw performance. It has four large cores (Cortex-X4) and four performance cores (Cortex-A720 cores), thus enabling it to excel in raw computing power and advanced AI capabilities.

Mediatek Dimensity 9300 Features

Dimensity 9300 key specifications

Like the last two generations, the Dimensity 9300 SoC is built on a TSMC 4nm process node. It is more efficient and performs better than the Dimensity 9200. There is a 40% improvement in the multi-core performance and a 15% improvement in the single-core performance. The Dimensity 9300 combines an octa-core CPU with the company’s second-generation hardware raytracing engine, enabling smartphones to achieve console-level global illumination effects at a smooth 60 FPS. Besides, the chipset supports seamless multitasking, allowing users to simultaneously play games and stream videos or watch a video while gaming.

  • Four ARM Cortex-X4 CPU. Prime core clocked at up to 3.25GHz
  • Four ARM Cortex-A720 CPU clocked at up to 2.0GHz

Mediatek Dimensity 9300 CPU Architecture

7th-gen APU 790 processor

The chip is equipped with MediaTek’s next-generation APU 790 processor, which reduces power consumption by 45% while improving performance. Its processing speed is eight times that of the APU 690. It also offers significant improvements in generative AI performance and energy efficiency for edge computing. The APU 790 is specifically designed for generative AI tasks, marking a substantial upgrade over its predecessor. It accelerates processing through the Transformer model and supports image generation within one second using Stable Diffusion. The APU 790 also supports large language models with up to 33 billion parameters. MediaTek has also implemented mixed-precision INT4 quantization technology and NeuroPilot memory hardware compression to optimize memory usage for large AI models.

Mediatek Dimensity 9300 APU

The Dimensity 9300 has a strong AI generative ecosystem, which supports language models like Llama 2, Baichuan 2 and Baidu AI LLM. It helps developers to efficiently deploy multi-modal generative AI applications for users.

Immortalis-G720 GPU

With the integration of ARM’s latest GPU, the Immortalis-G720, the Dimensity 9300 offers almost a 46% boost in GPU performance and 40% power reduction compared to the Dimensity 9200.

Mediatek Dimensity 9300 GPU

The Dimensity 9300 chipset supports the new Ultra HDR format in Android 14, improving mobile photography with vibrant images and compatible JPEG files. It also offers ambient light adaptive HDR recovery technology for enhanced photography. It supports 100% pixel-level autofocus, dual lossless zoom and 3-microphone HDR audio recording.

The chipset’s display system is equipped with the MiraVision Picture Quality (PQ) engine which dynamically adjusts the contrast, sharpness and color of primary objects, resulting in lifelike video experiences similar to high-end TVs. It uses on-device AI to detect primary objects and background images in real time.

Enhanced connectivity

The Dimensity 9300 offers Wi-Fi 7 speeds up to 6.5 Gbps and improved long-range connectivity with Xtra Range 2.0 Technology. It also enhances smartphone tethering speeds by up to three times using Multi-Link Hotspot technology. The Dimensity 9300 also supports up to three Bluetooth antennas and features dual Bluetooth flash connection technology for an ultra-low latency Bluetooth audio experience.

DRAM support and security

The Dimensity 9300 is the first SoC that supports the LPDDR5T up to 9600 Mbps. Also, it integrates two SUPs, one for boot security and one for computing security.

Dimensity 9300 vs Snapdragon 8 Gen 3

In terms of specifications, the Dimensity 9300 uses all big core architecture 4 prime cores (Cortex-X4) and 4 big cores (Cortex-A720), whereas the Snapdragon 8 Gen 3 uses one prime (Cortex-X4), five big (Cortex-A720) and two small cores (Cortex-A520). MediaTek with its all-big core design is addressing generative AI and gaming applications. On paper, the Dimensity 9300’s AI performance is competitive. The Dimensity 9300 supports large language models that can run with 13 billion parameters, whereas the Snapdragon 8 Gen 3 can run with 10 billion parameters on-device.

The fact that MediaTek now offers performance and efficiency gains that are comparable to Qualcomm’s latest-generation flagship offerings, shows MediaTek wants to directly compete with Qualcomm in the premium segment. Overall, this is going to be a win-win for the industry, as it will raise the bar and, in turn, benefit the end users.

A table showing the differences between Mediatek Dimensity 9300 and Qualcomm Snapdragon 8 Gen 3

Expected timeline

The vivo X100 will be the first smartphone to carry the Dimensity 9300 chipset. It will be available in the market by the end of 2023. We expect that the Dimensity 9300 will have better adoption among Chinese OEMs compared to the Dimensity 9200. China will be the first target market for smartphones with the Dimensity 9300, followed by India, SEA and Europe.

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MediaTek Weather’s Macroeconomic Headwinds With 9% YoY Revenue Growth

MediaTek‘s revenues fell 8.7% sequentially but increased 8.5% YoY to NT$142.1 billion. On a USD basis, revenues were comparatively flat due to FX weakness. Global macro headwinds, inventory correction, slow China market and weak consumer demand led to the revenue decline and weak outlook. Declining 8% QoQ, the smartphone segment contributed to 55%  (NT$ 78.2 in Q3 2022) of MediaTek’s total revenue in Q3 2022. Smartphone segment demand was affected by customers’ inventory adjustments, especially in the 5G mid-range SoCs. Demand for LTE SoCs was strong in QoQ terms.

MediaTek Earning 2022 Q3

 

  • The company has expanded its portfolio for the flagship and mid-range segments by launching Dimensity 9000+ and Dimensity 1050, respectively. The newly launched premium SoC has been adopted by top-end gaming smartphones. Also, MediaTek will launch a next-generation flagship SoC in Q4 2022. This will add to its premium segment revenue.
  • The Smart Edge segment, which contributed 38% to the company’s revenue in the third quarter, declined 9% QoQ as telecommunication operators cut back on orders, negatively impacting the company’s Wi-Fi and wired businesses. Also, the consumer market weakness affected the tablet, Chromebook and monitor businesses.
  • The power IC segment, which accounted for 7% of MediaTek’s revenue in Q3 2022, declined 17% QoQ due to weak demand for power ICs in consumer devices such as smartphones and PCs. But demand for power ICs for automotive and industrial applications remained robust in Q3 2022.
  • MediaTek guided Q4 2022 revenues in the range of NT$108 billion to NT$119.4 billion ($3.4 billion to $3.8 billion), a decline of 16%-24% QoQ and a decline of 7%-16% YoY. The gross margin is expected to be around 48.5% and the operating expense ratio is expected to be 31%. LTE SoCs will decline more severely than 5G SOCs in Q4 2022. Wi-Fi, broadband and routers will also be impacted as some of the Wi-Fi operators will slow down their fourth-quarter buy-in. The company also projected a sequential increase in revenues in Q1 2023.
  • The inventory level came down in Q3 2022 compared to the previous quarter. For both 4G and 5G, SoC inventory will come down in Q4 2022. Inventory corrections will be normalized in H1 2023.
  • According to Counterpoint Research’s Smartphone AP/SoC Shipment Tracker, MediaTek dominated the smartphone AP/SoC market in Q3 2022 with a share of 36.5%, followed by Qualcomm. MediaTek shipments have declined due to order cuts from major Chinese OEMs. MediaTek’s relatively greater dependence on the mid-end and low-end smartphone segments, which are likely to be more affected by the current macroeconomic situation as well as excess channel inventory, will lead to a weaker fourth quarter.

Overall, weak market outlook for Q4 2022 from MediaTek echoes increasingly cautious views from the foundry and IC packaging makers, which are seeing a slowdown in smartphone IC orders in early 2023. We expect 2023 to be challenging with inventory correction going on till H1 2023 and coming down to a normal level (80-90 days) by the end of 2023. The demand outlook for 2023 also looks challenging after inventory corrections due to macroeconomic uncertainty and weak China market. From the technology migration point of view, 5G SoCs are going to be a growth opportunity for the company. MediaTek will focus on maintaining gross margin, following price discipline at a time of uncertainty in the global semiconductor industry.

Entry Into Flagship Segment, 5G AP/SOCs Lead to Strong Growth for MediaTek in Q1 2022

  • MediaTek recorded an impressive set of numbers for Q1 2022 with revenues growing 32% YoY and 10.2% QoQ to reach $4.8 billion. The company’s mobile phone segment achieved a revenue of $2.7 billion, growing 29% YoY. According to Counterpoint Research’s Smartphone, AP/SOC Shipment Tracker, the addition of the Dimensity 9000 to the premium segment has added meaningfully to the overall revenues that have also been driven by 5G AP/SOCs in the mid-tier segment. LTE AP/SOCs are still attracting high demand and will be in tight supply throughout 2022. Based on our data, LTE AP/SOCs contributed to one-third of the total AP shipments in Q1 2022.
Counterpoint Research MediaTek revenue by segment
MediaTek Revenue by segment
  • The smart edge segment contributed 39% to MediaTek’s Q1 2022 revenues. This segment is mainly driven by the Wi-Fi 6/6E migration and higher-end solutions for smart TVs and tablets. Technology migration trends in smart edge platforms have led to a higher blended ASP in this segment.
  • The power IC segment accounted for 8% of the total revenues, growing 52% YoY and 21% QoQ. A large part of the PMIC segment’s revenue is coming from displays and smartphones. Automotive and industrial applications contribute to 10% of the PMIC revenue and will drive growth for this segment in 2022.
  • MediaTek guided revenues to be in the range of $5-$5.3 billion in Q2 2022, up 3~10% QoQ and 17~25% YoY. The mobile phone segment will show the strongest growth due to the shifting of demand from LTE to 5G AP/SOCs. As the China market is slowing, the revenue growth will come from other regions like India and Europe. Also, the Dimensity 9000 and 8000 series will continue to add to the revenues in Q2 2022. However, due to the slowdown in China and deteriorating macroeconomic conditions, we have reduced our H2 2022 forecast for the Dimensity 9000.
  • Revenues from Wi-Fi 6, 5G SIM modem, 5G tablet, 10G-PON and 4K smart TV are also expected to grow strongly in H2 2022. Also, MediaTek’s mmWave SOC is on schedule to ship in the second half of 2022. It will pave the way for MediaTek’s further expansion in the global market.
  • According to Counterpoint Research’s Smartphone AP/SOC Shipment Tracker, MediaTek will continue to lead the smartphone AP SOC market with a volume share of 41% in Q2 2022, followed by Qualcomm with 27%. The company’s strategy of 5G, Wi-Fi 6, focused product migration, geographic expansion with global customers, and penetration into high-end and flagship segments will allow MediaTek to retain and even improve its strong market position.
  • China slowdown, COVID-19 lockdowns and macroeconomic conditions will affect the global smartphone market. MediaTek guides flat growth for the smartphone market in 2022 and 5G penetration (660-680 million units) reaching 50%. Further, 5G penetration is expected to reach 70% in the next two years.
  • Smartphone OEMs like OPPO, vivo and Xiaomi currently have inventories with distributors and also for components like AP/SOCs, PMICs and DDICs. This has led to a drop in AP/SOC orders for MediaTek for H2 2022. But MediaTek is keeping a high inventory reserve this quarter to sustain its OEM and ODM partners during the worsening COVID-19 situation. MediaTek normally runs with around 90 days of inventory. But it has now raised this to around 100 days to manage potential supply constraints.
  • MediaTek sought to reassure investors that it would not follow a low pricing strategy to counter slowing demand. Instead, it will invest in future growth. Its pricing strategy will also leverage its high capacity and will manage profitability by maintaining similar pricing as the previous quarter. We expect overall 5G AP/SOC ASPs to be flat compared to last year. If the competition reduces the prices, it will be challenging for MediaTek to maintain growth in H2 2022. Due to the strong demand for LTE AP/SOCs, the ASPs will not decline this year. Overall, 5G AP/SOCs will have a premium pricing over LTE. The company is now focusing on developing 5G AP/SOCs for low-end phones priced less than $150. We believe this will happen two years down the line. However, based on our estimates, LTE is going to dominate the less than $100 smartphones, driven by regions like LATAM, Africa and APAC.
  • Presently, MediaTek is not a big player in the PC business, having only a few Chromebook-type devices in the market. The company played down its expectations for substantial growth in the PC sector while confirming that it was interested in the potential of the Arm-based PC market.
  • Smartphones still contribute 53% of the revenues for MediaTek. For longer-term growth, MediaTek has to reduce dependence on smartphones and expand into areas like the smart edge, automotive, connected PCs and AR/VR.

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Qualcomm Gains Share in Smartphone AP/SoC Shipments in Q4 2021; MediaTek Continues to Lead

  • Qualcomm’s share reached 30% driven by the premium tier.
  • UNISOC had a strong Q4 with its share reaching 11%.
  • Qualcomm led the 5G baseband market with a 76% share.

Seoul, Taipei, Beijing, New Delhi, London, Boston, Toronto, Hong Kong – February 24, 2022

The global smartphone AP (Application Processor)/SoC (System on Chip) chipset shipments grew 5% YoY in Q4 2021, according to the latest research from Counterpoint’s Foundry and AP/SoC service. 5G smartphone SoC shipments were almost half of the total SoC shipments.

Research Director Dale Gai said, “MediaTek led the smartphone SoC market with a share of 33%. Its smartphone SoC volumes declined this quarter due to the high shipments in the first half and inventory corrections from Chinese smartphone OEMs. Many customers had built chipset inventories to manage uncertainties in the supply situation.”

On the growth outlook, Gai added, “We expect revenues to grow in Q1 2022 driven by the flagship chipset (Dimensity 9000) for smartphones. Higher 5G penetration will offset the lower seasonal demand. The increase in chipset prices after TSMC’s wafer price hike is reflected from Q4 2021 onwards. 5G migration in regions like APAC, MEA and LATAM and continued LTE demand will help MediaTek have a strong 2022.”

Global Smartphone AP/SoC Shipment Market Share (%), Q4 2020 vs Q4 2021

Source: Counterpoint Research Quarterly AP/SoC/Baseband Shipments Tracker, February 2022

Commenting on Qualcomm’s performance, Senior Analyst Parv Sharma said, “Qualcomm recorded a very strong quarter, growing 18% QoQ and 33% YoY despite component shortages and foundry capacity not being able to keep up with demand. Qualcomm was able to prioritize high-end Snapdragon sales, which come with higher profitability and less impact from shortages than mid-end and low-end mobile handsets. The company was also able to increase supplies from its major foundry partners by dual-sourcing key products. It captured a 76% share in the 5G baseband shipments driven by Apple’s iPhone 13 and 12 series and premium Android portfolio.”

Commenting on the growth opportunities, Sharma added, “Qualcomm’s Snapdragon 8 Gen 1 flagship mobile platform will start shipping from Q1 2022. The performance in Q1 2022 will be driven by design wins in the Samsung Galaxy S22 series and launches in the Chinese New Year. Overall, the next inflexion in growth will be in H2 2022 with the launch of 5G handsets by major OEMs. The share of revenues from Android is also growing as more OEMs are adopting Qualcomm’s modem-to-antenna RFFE solution across tiers.”

Global 5G Smartphone Baseband Shipment Market Share (%), Q4 2020 vs Q4 2021

Source: Counterpoint Research Quarterly AP/SoC/Baseband Shipments Tracker, February 2022

Summary:

MediaTek led the smartphone SoC market in Q4 2021 with a 33% share. Shipments declined due to inventory correction as many customers had built inventories due to supply chain constraints.

Qualcomm grew 18% sequentially due to the premium segment and dual-sourcing from foundries. It dominated the 5G baseband modem shipments with a 76% share, driven by basebands for Apple and premium Android.

Apple maintained its third position in the smartphone SoC market in Q4 2021 with a 21% share. The iPhone 13 launch and festive season drove the shipments.

UNISOC continued with shipment growth this year and reached an 11% share in Q4 2021. On an annual basis, its SoC shipments more than doubled in 2021. It has expanded its customer base, securing design wins with HONOR, realme, Motorola, ZTE, Transsion and Samsung.

Samsung Exynos slipped to the fifth position with a 4% share as Samsung is in the middle of rejigging its smartphone portfolio strategy of in-sourcing as well as outsourcing to Chinese ODMs. As a result, the share of MediaTek and Qualcomm has been growing across Samsung’s smartphone portfolio, from the mid-range 4G and 5G models manufactured by ODMs to the flagship ones.

HiSilicon was unable to manufacture Kirin chipsets due to the US trade ban against Huawei. The accumulated inventory of Kirin SoCs is on the verge of being exhausted. As a result, Huawei is launching its latest series with Qualcomm SoCs but is limited to 4G capabilities.

For our comprehensive research on foundries to chipsets to devices, feel free to get in touch with us at the contacts given below.

Background:

Counterpoint Technology Market Research is a global research firm specializing in products in the TMT (technology, media and telecom) industry. It services major technology and financial firms with a mix of monthly reports, customized projects and detailed analyses of the mobile and technology markets. Its key analysts are seasoned experts in the high-tech industry.

Analyst Contacts:

Dale Gai
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Parv Sharma

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Foundry Strategy & Chipsets Supply Shaping Smartphone SoC Competitive Dynamics in 2021

Seoul, Taipei, Beijing, London, Boston, Toronto, New Delhi, Hong Kong – May 3, 2021

  • MediaTek to lead global smartphone SoC market with 37% share whereas Qualcomm will lead the global 5G smartphone SoC market with 30% share.
  • The leading-edge nodes (7nm, 6nm and 5n) will account for almost half of the smartphone shipment volume during 2021.
  • 5G AP/SoC chipset volumes will more than double annually in 2021.

The competitive dynamics in the smartphone AP/SoC market is changing fast for the fabless SoC vendors such as Qualcomm, MediaTek, Apple and others. The market outlook for these vendors is being shaped by not only the breadth and depth of the capabilities or tiering of the chipset portfolio but also by the choice, the share of the capacities across different edge-nodes at the foundries. Global smartphone AP (Application Processor)/SoC (System on Chip) chipset shipments will grow 3% YoY in 2021, factoring in the impact of supply constraint, rapid growth of 5G smartphones and related competitive dynamics according to the latest research from Counterpoint’s Foundry & Application Processor (AP/SoC) research.

Commenting on the research, Research Director Dale Gai said, “When we break down our forecast with respect to the current demand-supply dynamics, MediaTek is likely to continue its Q4 2020 momentum into 2021 and likely to capture 37% unit share of all the smartphone AP/SoC shipped for the full the year. This 20% potential annual uptick in demand is a function of competitive 5G portfolio powering sub-$150 5G smartphones manufactured at TSMC without any supply constraint and growing share in 4G segment. Further, MediaTek in the first half of 2021 will benefit from Qualcomm’s current supply constraints around RFICs (radio-frequency integrated circuits) from Samsung’s Austin fab, Power management ICs (PMIC), and relatively lower 5nm production yields.”

Exhibit 1: Global Smartphone AP/SoC Market Share (%) Outlook

Counterpoint Research: Global smartphone chipset share Mediatek leads in 2021 with 32% share
Global smartphone chipset share

Source: Counterpoint Research – Foundry & SoC Outlook, Apr 2021

Mr Gai, added, “However, we believe Qualcomm to bounce back strongly in H2 2021, firstly by securing greater capacity at TSMC to boost its 5G-centric tiered Snapdragon portfolio. Secondly, taking key steps to improve the supply of PMICs and RFICs should alleviate the supply constraints in coming months. This will allow Qualcomm to maintain its leadership in 5G SoC market and overall market share of 31% still growing annually.”

Highlighting the importance of leading-edge nodes and securing capacities for the same, Mr Gai noted, “The leading-edge nodes, including 7nm, 6nm and 5nm, will account for almost half of the smartphone shipment volume in 2021. These leading nodes are mainly for 5G smartphone models, as advanced nodes (e.g., 11/12/14nm at TSMC and Samsung) will serve the mainstream 4G LTE chipsets in 2021.”

Exhibit 2: Global 5G Smartphone AP/SoC Market Share (%) Outlook

5G smartphone Chipset SoC share
5G smartphone chipset forecast

Source: Counterpoint Research – Foundry & AP/SoC Outlook, Apr 2021

Commenting on the growth of 5G smartphone chipsets, Research Analyst Parv Sharma highlighted, “We estimate Qualcomm to increase its 5G SoC market share to grow to 30% mark in 2021, with 5G solutions across the tiers, from Snapdragon 8-series down to 4-series. If you include 5G baseband shipments to Apple, the overall 5G chipset market share jumps to 59% level. In an ideal scenario, Qualcomm’s market share in 5G segment would have been even higher if it did not face the unfortunate supply constraints in the first half of 2021. As Qualcomm turns to place more wafer orders on TSMC’s 6nm/5nm from Q2 2021, following the below-expectation wafer output of the Snapdragon 888 in the beginning of the year, we expect it to resume its 5G SoC shipment growth from H2 2021.”

Mr. Sharma further adds, “MediaTek leveraging TSMC and its affordable 5G portfolio is well-positioned to almost double its market share in 5G smartphone SoC/AP segment. Together, MediaTek and Qualcomm occupy nearly two-thirds of the 5G smartphone SoC market demand, but the gap between the two has narrowed. Having said that, the foundry capacity will continue to remain tight till early 2022, before the next wave of CAPEX realizes at the leading nodes.”

For our comprehensive research on foundry to chipsets to devices, feel free to contact us at the contacts below.

Background:

Counterpoint Technology Market Research is a global research firm specializing in products in the TMT (technology, media and telecom) industry. It services major technology and financial firms with a mix of monthly reports, customized projects and detailed analyses of the mobile and technology markets. Its key analysts are seasoned experts in the high-tech industry.

Analyst Contacts:

Dale Gai

 

Parv Sharma

 

 

Follow Counterpoint Research
press(at)counterpointresearch.com

 

 

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