The AI expansion has pushed forth the business of AI software, but there’s a simultaneous AI chip boom at our doorsteps as well. The MediaTek AI chip has brusquely pushed competitors aside and seen a 40 percent upsurge in the MediaTek stock price. While the semiconductor industry overall has been seeing growth in the valuation of its many firms, the Taiwanese tech company has been doing particularly well for itself recently. The MediaTek Dimensity 9300 chip has been hailed as the future of smartphone technology with many pairing it off against the previous industry leader Qualcomm. Let’s investigate the MediaTek AI chip boom.

Capitalizing on the AI Chip Boom, MediaTek Stocks See an Upward Surge

Image of the newly released Vivo X100

What’s Causing the AI Chip Boom?

MediaTek market share has been on the rise through its five-month rally that does not appear intent on slowing down anytime soon. The 2 percent growth of the Philadelphia Stock Exchange Semiconductor Index and the 7 percent rise for Qualcomm reported by Fortune would have been noteworthy in itself but MediaTek’s 40 percent stock increase has outdone the industry overall. 

Generative AI capacities have been the focus of the tech industry overall this year and updates from OpenAI, Microsoft, Google, Twitter/X, etc. have all revolved around their own AI offering to the industry. Samsng’s foray into the playing field with its Gauss AI and it’s clear that the smartphone AI revolution has also begun. But advances like this are only possible with chips and processors that can handle the processing needs of these AI advancements and that’s where the AI chip boom emerges victorious. 

The Qualcomm Snapdragon chipsets have long dominated the semiconductor industry with large props given to Samsung’s Exynos trying to make a mark. Despite  Qualcomm’s dominance, the China-based MediaTek Dimensity chip has grown significantly and with its four Cortex-X4 in the Dimensity 9300, it could easily hold the title of the most powerful mobile chip available right now.

MediaTek Dimensity 9300—It’s Coming in Hot

According to the website, the MediaTek Dimensity 9300 chip, is the world’s first flagship smartphone chip that features all big cores of the latest Arm Cortex-X4 and Cortex-A720 processors. It includes four Cortex-X4 performance cores with a speed of up to 3.25GHz and four Cortex-A720 efficiency cores with a speed of up to 2.0GHz. This should result in a 15 percent improvement in single-core performance and 40 percent improvement in multi-core performance. It features 18 megabytes of Level 3 cache along with a Single-Level Cell cache cache which is 29 percent larger than the previous generation.

The MediaTek valuation has skyrocketed largely thanks to this MediaTek Dimensity chip that is designed to support the “edge artificial intelligence” design that most smartphones are currently chasing in order to bring AI locally to their devices. This service is designed to help computations take place closer to the “edge” where the data is collected rather than rerouting it to centralized cloud computing centers which can delay the processing. This will not only allow for faster results but also ensure that devices do not have to rely on the internet for a large portion of their AI processing requirements

MediaTek Stock Summary

According to Bloomberg, MediaTek’s stock is currently trading at around 17 times the estimated earnings for the future, which is consistent with its average over the past five years. As a company, MediaTek is the second-largest listed company in Taiwan, with a market capitalization exceeding $47 billion, following Taiwan Semiconductor Manufacturing Co Ltd. A report by GIzmo China indicates that the Taiwanese company has committed to its presence in the UK by announcing a $12.5 million investment initiative in UK-based startups as well. The MediaTek stock rally perfectly lines up with the growth of the Chinese smartphone industry which reported a growth of 11 percent in October.

The Chinese phone Vivo X100 has already been launched with the MediaTek Dimensity 9300 chip but the device doesn’t seem to have gained as much traction as the AI chip boom would suggest. Reviews from platforms like GSMArena have already found limitations to the cooling capacity of the device when put under pressure, which will likely remain an issue for upcoming phones as well.

If smartphones truly become this capable, most tasks will be easily completed via these handheld devices at lightning-fast speeds. This is why the Dimensity 9300 has the power to become the most powerful mobile chip, with Qualcomm’s  Snapdragon 8 Gen 3 being its closest competitor. There will undoubtedly be challenges to the smooth integration of this technology into smartphones, and issues like overheating are something that companies will have to tackle before fully bringing efficient AI devices to the market.