MediaTek will likely report a substantial decrease sequentially in December revenues, due to a cutback in orders from handset vendors, according to industry sources.

MediaTek's December sales are also being affected by delayed deliveries at the request of its handset customers, said the sources.

Revenue outlook of other Taiwan-based IC design house for December is also less optimistic, as end-market device companies particularly smartphone firms decelerate their pace of orders to control year-end inventory, the sources indicated.

Chip orders from smartphone companies are expected to pick up prior to the 2016 Lunar New Year holiday season, but only slightly, the sources noted. A substantial pick-up in orders should take place after the Lunar New Year as the supply chain is gearing up for new smartphone models slated for launch in the second quarter, the sources said.