MediaTek: The Rival That Wins on PriceThin moat
Qualcomm (QCOM) — moat facet
MediaTek competes by redefining what counts as premium, in the market that is 46% of Qualcomm's revenue.
MediaTek is the reason Qualcomm's addressable market is smaller than the smartphone market.
The competition is not really over the premium tier, where Snapdragon has held. It is over what counts as premium. MediaTek's Dimensity line has moved up from the entry segment through the mid-range and into the lower flagship tier, and each step converts a socket Qualcomm used to win into one it either loses or defends on price.
The exposure is geographically precise. China including Hong Kong was $20.3 billion — 46% of Qualcomm's fiscal 2025 revenue by customer headquarters, and the Chinese handset makers are the buyers most willing to trade a specification for a price.1 The same customers who have doubled Qualcomm's China share in two years are the ones MediaTek is designed to take.
What blunts it is the licence. When a handset maker switches from Snapdragon to Dimensity, Qualcomm loses the chip revenue and keeps the royalty, because QTL is paid on the handset regardless of whose silicon is inside.2 The relationship goes from a high-revenue one to a very high-margin small one.
That cushion is real and it is a quarter of the profit at most.3
Watch Qualcomm's China revenue share. It rose from 37% to 46% in two years; the direction it goes next tells you whether the premium defence is holding.
MediaTek's advance into the lower premium tier continues, and Qualcomm's exposure to the most price-sensitive buyers rose from 37% to 46% of revenue in two years.
Up from 37% in fiscal 2023, by customer headquarters. This is where MediaTek competes hardest and where the buyers are most willing to trade specification for price. When a customer switches chips Qualcomm keeps the royalty and loses the margin, which softens the loss without replacing it.
Source: Qualcomm Form 10-K, FY2025 ↗- ReportedChina including Hong Kong was $20.3 billion — 46% of Qualcomm's fiscal 2025 revenue by customer headquarters, and the Chinese handset makers are the buyers most willing to trade a specification for a price.Qualcomm Incorporated, Form 10-K for the fiscal year ended 28 September 2025 (SEC, CIK 804328) — Item 1, Business, and the revenue-concentration and geographic disclosures. Qualcomm operates through QCT (semiconductors) and QTL (licensing), with QSI making strategic investments. QTL grants licences to portions of a patent portfolio including rights essential to and/or useful in the manufacture and sale of certain wireless products. In fiscal 2025 revenues from Apple, Samsung and Xiaomi each comprised 10% or more of consolidated revenues. Revenues by country, reported by customer or licensee headquarters: China including Hong Kong $20,340M (46%), United States $10,515M (24%), South Korea $9,542M (21%), other foreign $3,887M (9%), total $44,284M; the equivalent 2023 figures were $13,386M (37%), $10,503M (29%), $8,075M (23%) and $3,856M (11%). Approximately 52,000 full-time, part-time and temporary workers at 28 September 2025, in over 200 locations in 38 countries, with a voluntary turnover rate around 6%. Named registry and semiconductor competitors and the risk factors relating to customer vertical integration are set out in the same Item. — FY2025 · publ. 2025-11-05 · source ↗
- ReportedWhen a handset maker switches from Snapdragon to Dimensity, Qualcomm loses the chip revenue and keeps the royalty, because QTL is paid on the handset regardless of whose silicon is inside.Qualcomm Incorporated, Form 10-K FY2025 — Item 7, Management's Discussion and Analysis, and the reportable-segment note. QCT revenues $38,367M (2024 $33,196M, 2023 $30,382M) with EBT of $11,670M ($9,527M, $7,924M) at 30% of revenues (29%, 26%); QCT revenue streams handsets $27,793M ($24,863M, $22,570M), automotive $3,957M ($2,910M, $1,872M) and IoT $6,617M ($5,423M, $5,940M). QTL revenues $5,582M ($5,572M, $5,306M) against total costs and expenses of $1,539M ($1,545M, $1,678M), for EBT of $4,043M ($4,027M, $3,628M) — 72% of revenues in each of the three years. Reportable-segment revenues $43,949M, $38,786M and $35,716M against consolidated revenues of $44,284M, $38,962M and $35,820M. During the second quarter of fiscal 2025 Qualcomm executed final agreements for new long-term licensing arrangements. — FY2025 · publ. 2025-11-05 · source ↗
- ReportedThat cushion is real and it is a quarter of the profit at most.Qualcomm Incorporated, Form 10-K FY2025 — Item 7, Management's Discussion and Analysis, and the reportable-segment note. QCT revenues $38,367M (2024 $33,196M, 2023 $30,382M) with EBT of $11,670M ($9,527M, $7,924M) at 30% of revenues (29%, 26%); QCT revenue streams handsets $27,793M ($24,863M, $22,570M), automotive $3,957M ($2,910M, $1,872M) and IoT $6,617M ($5,423M, $5,940M). QTL revenues $5,582M ($5,572M, $5,306M) against total costs and expenses of $1,539M ($1,545M, $1,678M), for EBT of $4,043M ($4,027M, $3,628M) — 72% of revenues in each of the three years. Reportable-segment revenues $43,949M, $38,786M and $35,716M against consolidated revenues of $44,284M, $38,962M and $35,820M. During the second quarter of fiscal 2025 Qualcomm executed final agreements for new long-term licensing arrangements. — FY2025 · publ. 2025-11-05 · source ↗