Artificial intelligence has sparked major shifts across the global semiconductor landscape, but few companies have felt the impact as directly — or as dramatically — as MediaTek. Once best known for powering mid-range smartphones, the Taiwanese chipmaker is now riding a wave of excitement tied to Google’s newest AI advancements. The result? MediaTek just recorded its best trading week since 2002, a milestone that reflects not only investor optimism but also the company’s evolving strategic role in AI hardware design.
As big tech firms race to secure faster, more efficient AI chips, MediaTek’s partnership with Google has become a powerful catalyst. With growing speculation that Google’s tensor processing units (TPUs) could challenge Nvidia’s long-dominant GPU technology, the market is suddenly reevaluating MediaTek’s long-term potential — not as a phone-chip vendor, but as a key participant in next-generation AI infrastructure.
Below, we break down why MediaTek soared this week, what analysts forecast for its future, and how Google’s AI progress is shifting the competitive dynamics across the chip industry.
MediaTek’s Stock Posts a Historic 22% Weekly Rally
MediaTek shares rose for five consecutive sessions, bringing the weekly gain to 22% — the company’s strongest performance in more than 20 years. The enthusiasm was triggered by multiple AI-related developments:
- Google’s launch of its most advanced Gemini AI model
- Reports that MediaTek is co-designing new TPU hardware with Google
- Renewed investor confidence in AI-focused semiconductor companies
Despite being down 1% for the year prior to the rally, the stock’s rebound reflects the growing belief that MediaTek is positioned for massive AI-driven growth heading into 2026–2028.
Google Partnership Could Transform MediaTek’s Business
MediaTek has traditionally built its business around smartphone chipsets, battling aggressive competition from Qualcomm and Chinese suppliers. But the partnership with Google represents something entirely different: an entry point into high-value AI accelerator chip design.
Google’s TPUs — specialized AI chips optimized for inference and training — are increasingly seen as the closest alternative to Nvidia GPUs. The fact that MediaTek is reportedly collaborating on future TPU design could:
- Sharpen Google’s competitive edge against Nvidia
- Provide MediaTek with a multi-billion-dollar new revenue stream
- Diversify its portfolio away from volatile smartphone demand
As AI usage shifts from model training to large-scale inference, demand for application-specific integrated circuits (ASICs) like TPUs is expected to surge.
Smartphone Weakness, China Slowdown Still a Challenge
MediaTek’s legacy smartphone business continues to face headwinds:
- Soft demand in China
- Margin pressure due to rising development costs
- Saturation in global smartphone markets
Morgan Stanley analysts Charlie Chan and Daniel Yen noted that conditions in China will remain difficult into 2026, but emphasized that the TPU opportunity provides meaningful long-term upside. They upgraded MediaTek from equal-weight to overweight, signaling renewed optimism.
Analyst Forecasts: TPU Revenue Could Hit $4 Billion
UBS research shows just how powerful the AI pivot could be for MediaTek. Analysts led by Sunny Lin revised their long-term projections significantly:
- 2027 TPU revenue estimate raised from $1.8B to $4B
- TPUs could account for 20% of MediaTek’s operating profit by 2028
These projections depend heavily on the execution of Google’s roadmap and MediaTek’s ability to scale advanced ASIC production — but the upside is substantial.
Meta’s Interest Adds Fuel to the Fire
Adding even more momentum to MediaTek’s breakout week, news surfaced that Meta Platforms Inc. is exploring the use of Google TPUs in its next generation of AI data centers, planned for 2027.
UBS believes MediaTek could earn additional upside through:
- Supplemental TPU contracts
- ASIC development projects tied to Meta’s long-term AI infrastructure
- New diversification away from consumer electronics
If Meta adopts TPU technology, it would represent one of the most significant validations of Google’s AI hardware strategy to date — and by extension, MediaTek’s role in that ecosystem.
Market Sentiment: Broadly Bullish Across Wall Street
Analysts remain overwhelmingly optimistic:
- 23 Buy ratings
- 10 Hold ratings
- 0 Sell ratings
Consensus price targets predict an additional 9% upside over the next year, though some analysts hint that forecast revisions may climb higher if TPU adoption accelerates.
The Bigger Picture: Is Nvidia’s Dominance at Risk?
While Nvidia remains the industry’s gold standard for AI chips, major shifts are underway:
1. AI workloads are evolving
Training large models requires GPUs, but inference at scale often favors ASICs like Google’s TPUs.
2. The market wants more suppliers
The AI chip market is experiencing shortages, delays, and increasing dependencies on Nvidia — something cloud giants want to diversify.
3. Google’s ecosystem is rapidly advancing
The Gemini AI model, broader TPU deployments, and new partnerships are increasing confidence in Google’s hardware strategy.
Macquarie analysts commented this week:
“We lean more toward MediaTek and Google partners over the Nvidia supply chain.”
Their view: AI is entering a long-term infrastructure buildout, not a speculative bubble. That means companies tied to foundational AI hardware — not just GPUs, but also ASICs — could benefit for years to come.
MediaTek is Transforming From Smartphone Supplier to AI Powerhouse
The surge in MediaTek’s stock is more than a temporary reaction to headlines — it’s a reflection of how dramatically the company’s future is changing. As AI becomes deeply embedded in global computing infrastructure, chipmakers capable of building specialized, scalable solutions stand to benefit the most.
MediaTek’s partnership with Google places it at the center of this transformation. While smartphone softness and China challenges may persist in the near term, the long-term shift toward AI-centric semiconductor growth provides a compelling new narrative.
If Google TPUs gain broader adoption — especially with Meta exploring the technology — MediaTek could evolve from a mid-tier phone chip supplier into a major player in next-generation AI computing. For investors seeking exposure to the next wave of AI hardware, MediaTek may be one of the most overlooked opportunities in today’s market.