As artificial intelligence adoption accelerates worldwide, pressure is building across global technology supply chains, pushing up costs for chipmakers and their customers.
Taiwan’s leading chip design company MediaTek said on Wednesday that rising demand for AI applications is stretching supply chains and increasing costs. The company added that it will adjust its pricing to reflect these pressures. Taiwanese technology firms, including MediaTek and TSMC, the world’s largest contract chipmaker, have reported strong business growth driven by the AI boom.
Speaking during a quarterly earnings conference call, MediaTek Chief Executive Rick Tsai said he remains confident about the company’s outlook but warned that supply constraints are emerging.
“With AI serving as a catalyst for industry expansion and driving the surge in demand, the global supply chain is facing challenges in fully meeting the increasing needs in 2026, resulting in higher costs across the supply chain,” Tsai said. “We will also adjust our pricings to reflect the rising supply chain costs and allocate our supply across products based on the overall profitability,” he added, without giving further details.
Tsai also repeated comments from the company’s previous earnings call in October, stating that MediaTek expects to generate revenue of billions of dollars from its AI accelerator ASIC chips by 2027.
He said the total addressable market for data centre ASIC chips is now estimated at $50 billion to $70 billion, which is $20 billion higher than earlier projections.
MediaTek has partnered with Nvidia to co-design the GB10 Grace Blackwell Superchip, which is used in Nvidia’s DGX Spark, a personal AI supercomputer that went on sale last year. Tsai, who attended Nvidia CEO Jensen Huang’s dinner with Taiwanese suppliers in Taipei on Saturday, said MediaTek has seen “very positive feedback” for DGX Spark and expects revenue growth to accelerate into 2026.
On Wednesday, MediaTek reported fourth-quarter revenue of T$150.2 billion, or $4.76 billion, up 8.8% from a year earlier. Net income fell 3.6% to T$23.1 billion.
MediaTek shares are up 26% so far this year, outperforming the benchmark index’s gain of 11.5%. The stock closed 0.3% higher on Wednesday ahead of the earnings announcement.
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