As its smartphone clients face a supply glut, and inflation and macroeconomic uncertainty dent demand for consumer electronics, Taiwan's top chip design company MediaTek is focusing more resources on chips for cars and AI computing.

"We are definitely moving our resources very, very rapidly towards the automotive and computing areas, because those areas will provide our growth in the next three to five years," MediaTek Inc Chief Executive Rick Tsai said during an earnings call.

"We are not reducing people in this extremely demanding environment." We're not growing either. "The most important thing is to allocate those precious resources," he explained.

Tsai stated that everyone, including MediaTek, was rushing to claim that they could support generative AI, such as ChatGPT.

"We're confident that we will be able to provide the capability to our customers," Tsai said.

Tsai stated that MediaTek is heavily investing in AI because the new areas of focus for the company are all related to computing. AI chips, for example, are required for the development of self-driving cars.

While smartphone demand remained subdued in the first quarter, the company anticipates signs of improvement later this year.

"Demand for certain consumer electronics, such as smartphones, is weaker than expected," Tsai explained. "As customers remain cautious about future demand, we anticipate flattish mobile revenue in the second quarter and an increase in the second half."