MediaTek Cuts Employee Bonuses Amidst Chipset Market Downturn

Taiwanese fabless semiconductor manufacturer MediaTek has reduced employee bonuses for the second half of 2025 by 15.7% compared to the first half, signaling concerns about a potential decline in chipset shipments. The move impacts approximately 12,000 employees and reflects broader challenges within the semiconductor industry, particularly related to DRAM and NAND supply shortages.

Bonus Reduction Details

The total bonus allocation for H2 2025 amounts to NT$11.4 billion (approximately $363 million USD), with each eligible employee receiving an average of NT$950,000 (roughly $30,247.74 USD). While MediaTek distributes bonuses twice annually, the amount varies based on department, job level, and individual performance evaluations.

Impact of Component Shortages

The reduction in bonuses coincides with ongoing shortages of RAM and storage components, which are limiting shipment growth across the semiconductor sector. These shortages are creating cost pressures throughout the supply chain and impacting the financial performance of chipset manufacturers.

Smartphone Chipset Dependence

MediaTek’s revenue is heavily reliant on smartphone chipsets, with this segment accounting for 59% of total revenue in Q4 2025. This dependence makes the company particularly vulnerable to fluctuations in the smartphone market and disruptions in component supply.

Future Outlook

Despite the current challenges, industry projections suggest MediaTek will remain a leading supplier in 2026, supported by demand for its Dimensity series chipsets. However, the company’s leadership in shipment volume does not insulate it from the effects of constrained DRAM and NAND supply. MediaTek is also preparing to introduce its Dimensity 9600, expected to be manufactured on a 2nm process node.

Google TPU Orders and TSMC Collaboration

In related news, MediaTek has reportedly secured orders for Google’s v7e and v8e Tensor Processing Units (TPUs) and has requested a seven-fold increase in CoWoS (Chip-on-Wafer-on-Substrate) wafers from TSMC to support this project. This indicates a strategic diversification effort beyond smartphone chipsets.