07 Feb 2023 -

Chip market: Cyclicality is back, says Gartner


Technology research firm, Gartner, recently published a Q&A with its VP Analyst, Gaurav Gupta, on the current semiconductor market dynamics and the impact of chip inventory on the electronics manufacturing industry.

The big question was, “Is there still a chip shortage?” His answer: yes, and no.

Gupta states that while the overall index is no longer in a shortage zone, inventory imbalances do still exist — some remain scarce, while others are now in surplus.

For example, the memory market will see oversupply for most of 2023 due to weak end-equipment demand, despite the slowdown in production by vendors. On the other hand, optoelectronic chips continue to see inventory depletion as OEMs’ panic-buy from LED vendors amidst ongoing COVID-19 uncertainties in China. 

What’s his view on revenue forecasts for the industry? “OEMs remain aggressive with inventory management, significantly reducing shelf inventory and increasing cautiousness with forward orders. Production forecasts have been reduced for various electronic equipment types, which is affecting chip unit shipments and pricing. Fluctuating chip prices have been the key influencing factor driving short-term changes to semiconductor revenue forecasts,” said Gupta.

To avoid electronics supply-chain disruptions, you may also wish to consult an expert in electronics component supply. With more than three decades of supply-chain expertise, Astute Electronics is ideally placed to work with you on your daily component requirements.

For more help with looking at supply chain options, contact Astute Electronics

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