Global chip shortage has hit smartphone makers

According to online sources, the global shortage of semiconductor products has started to negatively impact the smartphone industry. Deliveries are slowing and buyers are seeing significant price increases for the first time in years. Some manufacturers have had to cut production and delay the launch of new devices.

For most of the year, smartphone makers have avoided issues faced by automotive, IT, and consumer electronics companies due to the chip shortage. This is because the big smartphone makers usually buy components six months in advance; but now the time has come when these stocks are coming to an end.

For Samsung, the world’s largest smartphone maker, the chip shortage caused shipments to drop 20% from the previous quarter, the source said. Google has announced that the new Pixel 5a 5G smartphones will only be available in the US and Japanese markets; while previous Pixel models were available in more countries. Chinese Xiaomi has increased the price of the Redmi Note 10 sold in India; approximately 8% compared to the price when the device was launched. In April, Xiaomi introduced the Mi 11 Ultra smartphone in India; but sales were delayed and the smartphone was only released this month.

the source notes that semiconductor shortage issues are unevenly distributed across the smartphone industry. According to analysts, Apple; which represents about one sixth of the 1.3 billion smartphones sold each year; has managed to avoid problems through its influence in supply chains. The same goes for many high-end Samsung smartphones. However, over 80% of the smartphone industry remains stuck with chip shortages.

Global chip shortage has hit smartphone makers

According to Counterpoint Research, global smartphone shipments in the first three months of 2021 were up 20% from the same period in 2020 and by 4% during the first quarter of 2019. The industry appears to have aimed for a year successful ; as the release of the coronavirus vaccine has begun and people feel the impending end of a period of restrictions; started spending money again. During the period from April to July of last year, smartphone shipments fell as much as possible; mainly due to the fact that severe restrictive measures have been introduced in many countries due to the pandemic.

Counterpoint estimates that second quarter global smartphone shipments will decrease by 10% from the first quarter. Despite this, they expect smartphone shipments in the third and fourth quarters to be more stable than during the same periods in 2019 and 2020. Counterpoint analysts estimate that smartphone makers will launch 771 million devices. on the market in the second half of this year; up 1.3% from 761 million devices shipped in the second half of last year. The increase in component prices due to the lack of chips is currently being offset by manufacturers by rising device prices. According to the researchers, the average wholesale price of smartphones around the world rose 5% in the second quarter.

We can see the lack of supply in the smartphone segment in the quarterly financial statements of Taiwan Semiconductor Manufacturing Co., the world’s largest contract chip maker. TSMC’s total sales were up 20% year-over-year, but the company’s smartphone chip revenue was down 3%.

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