MediaTek has approved a $5 billion discretionary financing framework to support its expansion into custom AI data centre chips. The board approved the plan on July 31. It gives the company room to raise capital as customer demand and production needs increase.
The move comes as MediaTek seeks more revenue outside smartphones. Its mobile chip sales fell 20% from a year earlier during the June quarter. Higher component costs and weaker handset demand also placed pressure on the wider business.
Chief executive Rick Tsai said the framework provides financial flexibility for long-term growth and large data centre opportunities. “This flexible framework provides us with the optionality, when needed, to agilely support our long-term growth.” Tsai made the comment during the earnings call.
The approval does not require MediaTek to use the full amount immediately. Instead, the company can arrange financing when it needs funds for chip development and manufacturing capacity. The money may also support advanced packaging, memory supplies and production work linked to customer orders.
MediaTek has expanded its data centre work through custom chip design and high-speed connectivity products. In June, the company said its services cover advanced chip processes, packaging, memory, interconnects and rack-level integration. These areas form part of its custom silicon offer for cloud companies building AI infrastructure.
MediaTek raised its estimate for the 2027 custom AI chip market to $80 billion. Its earlier forecast placed the market between $70 billion and $80 billion. The company also increased its target share to 15% to 20%, from 10% to 15%.
Three months earlier, MediaTek had already doubled its 2026 AI accelerator revenue target to $2 billion. Customer programmes were moving closer to commercial production during that period.
The chip designer now expects its data centre AI business to generate more than $2 billion in 2026. Its first custom AI chip will enter production in the fourth quarter. MediaTek expects a second product to reach volume production in 2028.
Custom chips allow cloud companies to build processors for specific AI workloads instead of relying only on standard products. MediaTek supplies design services and supporting technology. Customers then set performance, power and system requirements for their data centres.
Meanwhile, MediaTek reported quarterly revenue of NT$152.18 billion, or about $4.71 billion. Revenue rose 1.2% from the same period last year. However, net income fell 12.3% to NT$24.6 billion as mobile conditions and product costs weighed on earnings.
Tsai said MediaTek still expects global smartphone shipments to decline about 15% in units this year. Industry estimates showed an 11% shipment drop during the second quarter. That marked the weakest June quarter since 2013. Memory shortages also raised handset prices and reduced demand.
MediaTek has started raising prices across parts of its product range to reflect higher supply-chain costs. Tsai said the company was taking pricing action so product prices could reflect rising costs. Even so, lower mobile chip volumes remain a challenge while smartphone makers manage weaker sales.
Investors reacted strongly before the earnings release. MediaTek shares closed 9.9% higher on Friday and had gained 148.6% during 2026. Taiwan’s benchmark index rose 48.9% over the same period. The company’s market value reached about $176 billion, making it Taiwan’s second-largest listed company.