Less than a day, MediaTek twice responded to news about selling chips to ZTE.
At 1:12 a.m. on April 28th, Beijing time, MediaTek stated on the official Weibo that there were related cases in which ZF dispatched ZTE. According to the requirements of relevant agencies of Taiwan's economic authorities, MediaTek is actively preparing related documents. The license for export of ZTE's goods is expected to continue smoothly after obtaining the export license for goods as soon as possible.
MediaTek is a global leader in IC design and provides integrated multi-field system wafer integration solutions. On April 27th, the Internet circulated that 'Taifa Chief Executive Cai Lixing claimed that Taiwan's relevant departments requested MediaTek to stop selling chips to ZTE'.
After that, MediaTek responded to the “Daily Economic News” that at the legal briefing on the afternoon of the 27th, some people talked about the embargo imposed by the US government on ZTE. Cai Lixing said that the relevant departments in Taiwan did not request that MediaTek not be able to supply ZTE. In general, if there is a supply requirement for ZTE, MediaTek will first apply to the relevant departments in Taiwan. At present, MediaTek has not issued a statement that it cannot supply ZTE.
On the evening of April 27, Taiwan’s regional economic authorities issued a message on the official website, which mentioned that: The department has included ZTE in the strategic export control of high-tech goods in the Taiwan region. All exports from Taiwan to ZTE must be advanced. After obtaining the export license for strategic high-tech goods, we will send the shipment to the relevant authorities for export. The review of the relevant application, if it does not involve nuclear energy, biological, chemical and other military weapons development, the 'trade bureau' and other issuing units will be 3~ 5 working days to issue the certificate. If there is doubt, the relevant unit will be invited to review and issue the certificate within 10~15 working days.
Also on April 27, MediaTek released its first-quarter financial report for 2018, with revenue of 49.64 billion Taiwan dollars (approximately 10.645 billion yuan), a year-on-year decrease of 17.8%. Gross profit margin was 38.4%. The growth rate was 1 percentage point. The operating profit was NT$1.99 billion (approximately RMB 414 million), an increase of 49.5% from the previous quarter. The net profit was NT$2.66 billion (approximately RMB 570 million).
On the subsequent conference call, MediaTek CEO Cai Lixing said that the Taiwan authorities currently do not allow MediaTek to provide any smart phone components to ZTE, saying that the matter has limited financial impact on the company. Looking at the business of ZTE and MediaTek, ZTE is mainly MediaTek uses MediaTek on mid-range models. If MediaTek can no longer provide chips for ZTE, its market share in mainland China will become even lower, and it will most likely be eliminated by the Chinese market in the future.