MediaTek is expected to post revenue growth of slower-than-expected 10-15% sequentially in the second quarter of 2017, according to market observers, which estimated previously a robust 20% increase.

MediaTek will likely give a less-optimistic outlook about its performance in the second quarter, said the observers, adding that the company will be striving to defend its smartphone-chip market share in 2017 given that some of its customers have shifted orders away.

Particularly in the mid- to high-end market segments, MediaTek has failed to obtain new chip orders from China-based smartphone vendors, the sources indicated.

MediaTek remains relatively competitive in the entry-level and mid-range segments, but rivals' aggressive price cutting is hurting its profitability, the sources identified.

MediaTek has reported first-quarter revenues fell 18.3% sequentially to NT$56.08 billion (US$1.9 billion).

MediaTek is scheduled to hold its quarterly investors meeting on April 28 to discuss its performance in the first quarter, and provide a business outlook.

MediaTek vice chairman Ching-jiang Hsieh said in January the company will continue to improve its product mix with new and cost-optimized solutions ready for mass shipments in the second half of 2017. The company is striving to improve its gross margin for all of 2017.

MediaTek posted record revenues of NT$275.5 billion for 2016, but the year saw a record-low gross margin at 35.6%.