Global chip shortage: Tech sector struggles front and center in company filings

In recent months, a global chip shortage has reverberated across industries ranging from consumer electronics to automobiles as manufacturers vie for a slice of the silicon pie. A dearth of chips and related disruptions have led to empty store shelves, production bottlenecks and headaches for shoppers. On Friday, consulting company, GlobalData, published a release about the chip shortage with a focus on the tech sector’s struggles.

Global chip shortage: Tech sector disruptions

Citing the company’s analytics platform data, GlobalData said “discussions around shortage and related keywords” increased 74% from the fourth quarter of 2020 to the first quarter of 2021 and about 17% of these discussed “impacts on production and capacity.”

“The current scenario looks concerning for tech manufacturers, as mentions around new product and shipment delays rose by around 23% in Q1 2021. Additionally, 3% of the overall shortage mentions in Q1 2021 highlights that the adverse impacts are likely to last until 2022 or early 2023 due to the huge boom in demand,” said Rinaldo Pereira, senior business fundamentals analyst at GlobalData in a release.

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Foundries are raking in big bucks and record revenue amid the chip shortages, but the timeline for a market normalization remains unclear. At the same time, nations around the globe are taking measures to help shore up access to semiconductor chips. For example, as our sister site ZDNet previously reported, the U.S. Senate recently approved a $52 billion bill to increase the U.S. chip supply.

“There is a sudden spike in semiconductor-related shortage mentions in Q1 2021 as companies remain concerned about long-lasting pandemic-led supply chain disruptions, which also seems to have been spurred on by the US Government’s sanctions on China,” Pereira said.

Discussing 2021 tech sector filings, Pereira said about one-third of the “sentences with shortage and related keywords were negative.” Pereira added that the “negativity suggests that manufacturers are unable to keep up with the widening supply-demand gap.”

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“Looking on the bright side, discussions around production capacities in filings of component manufacturers were also up in Q1 2021. Companies including Intel and Taiwan Semiconductor Manufacturing Company (TSMC) have committed to capacity expansions to address the long-term demand,” Pereira said.

Global chip shortage: Products impacted

Computer chips are integral to a number of modern products; after all, even refrigerators have brains in the 21st century. Earlier this year, Ford announced that it was decreasing F-150 production due to chip constraints and General Motors has also limited vehicle production, but the silicon logjam is holding up more than cars.

The global chip shortage has made it difficult for gamers to get their hands on the latest consoles even months after the initial product release. As we’ve previously reported, the PS5 restock issues and chip shortage could spur a retro gaming renaissance of sorts.

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