American semiconductor maker Qualcomm is taking market share from its competitor MediaTek in China, according to a recent analysis conducted by DigiTimes Research, as reported by The Motley Fool. The San Diego-based company managed to increase its share of the smartphone application processor (AP) market in the Far Eastern country to over 30 percent during the first quarter of the year following a prolonged period of struggling and is seemingly in the right position to take more market share from its Taiwanese competitor in the coming months, industry analysts believe. While MediaTek still holds just under 40 percent of the market, that percentage is currently declining, and most indicators suggest that this trend will continue in the immediate future, the report explains.
Industry sources told DigiTimes that MediaTek shipped less than 100 million of phone chips during the first quarter of the year and the Hsinchu, Taiwan-based company isn't expected to significantly improve upon that number during the current quarter as its shipments are estimated to be in the range of 110 million and 120 million. The second half of 2017 is poised to be even more uncertain for MediaTek and it's becoming increasingly unlikely that the chipmaker will be able to surpass its 2016 shipment numbers that reached 480 million units, industry watchers believe.
According to the latest report, local original equipment manufacturers (OEMs) like Vivo and OPPO are one of the main reasons why Qualcomm is currently winning market share in China at the expense of MediaTek seeing how those two phone vendors accounted for the majority of the 28 million units of the Snapdragon 835 that Qualcomm shipped in the Far Easter country during the first quarter of 2017. The company's latest flagship system-on-chip (SoC) and its first chipset manufactured using the 10nm process is expected to perform even better in China in the following period and help the company expand its presence in the country in a significant manner after only shipping eight million chips in China in Q4 2016, analysts say. While it remains to be seen whether MediaTek manages to bounce back and stop losing market share in the country to Qualcomm, it seems that the smartphone AP industry in China is set to become even more competitive in the coming months.