MediaTek directing its focus into automobiles, AI

Taiwan's chip design company MediaTek is focusing more resources on chips for cars and AI computing as its smartphone sees a lacklustre performance and inflation & macroeconomic uncertainty dent demand for consumer electronics.

"We are definitely moving our resources very, very rapidly towards the automotive and computing areas, because those areas will provide our growth in the next three to five years," MediaTek Chief Executive Rick Tsai told an earnings call. "In this very demanding environment, we are not reducing people. We're not increasing either. The critical thing is to allocate those precious resources. We are confident that we will be able to provide the capability to our customers," he said.

MediaTek is investing heavily in AI because the new areas the company is focusing on are all related to computing and will provide the company growth in the next three to five years.

While smartphone demand has remained lacklustre in the first quarter, the company expects signs of recovery later this year.

"Demand for certain consumer electronics such as smartphones is weaker than we expected," Tsai said. "As customers remain cautious about future demand, we expect our mobile revenue to be flattish in the second quarter and to improve in the second half."