Samsung Electronics announced it is struggling with the insufficient stock of a “serious imbalance” in semiconductors globally. The Company becomes the largest tech giant to announce the concerns about chip shortages spreading beyond the electronics industry.
Widely known as one of the world’s largest makers of chips and consumer electronics, Samsung expects the chip shortage to pose a problem to its business next quarter. As stated by the co-Chief Executive Officer Koh Dong-jin during an annual shareholders meeting in Seoul, the company is also considering skipping the introduction of a new Note, it’s one of the best-selling models.
In recent weeks, the successful and powerful leaders from Continental AG to Renesas Electronics and Innolux thanked to COVID-era as demand for everything from cars to Video consoles and mobile devices have increased. Samsung, the world’s largest smartphone maker is now working with overseas partners to resolve the imbalance in supply and demand of chips in the IT sector globally.
In this critical situation, Samsung’s business leaders are meeting partners overseas to solve all issues related to the business and even it is hard to say the shortage issue has been solved 100 percent. The Company’s shares were largely unchanged in Seoul. Samsung and Taiwan Semiconductor Manufacturing Co. make every global effort to plug a shortfall in supply of chips, the building blocks of all consumer gadgets.
Because of poor inventory planning, carmakers are expected to miss out on $61 billion (approximately Rs. 4,42,740 crore) of sales in the same year. Honda Motor has temporarily suspended some production at a majority of US and Canada plants to resolve the crisis issue.
Semiconductors are now near the top of official agendas but some analysts say shortages could get mostly sorted out in coming months. The main concern is related to tight supply in certain segments, the building capacity of semi-conductors and increasing prices in the broader consumer electronics industry.
Recently, the assembler of most of the world’s iPhone models joined a meeting for resolving imbalances in demand and supply. According to Hon Hai Chairman Young Liu in Taipei, there is a shortage but the impact for most of the customers is not that big. Certain customers have better than expected orders where there is no big surge on orders.
Intensifying issue, Samsung’s own creation got sideswiped a month ago. Its fab in Austin, Texas – which makes chips both for inside and outside utilization – was sidelined in February by statewide blackouts and hasn’t continued full creation. The subsequent shortage underway of Qualcomm 5G radio recurrence chips could decrease worldwide cell phone yield by 5% in the subsequent quarter, research firm Trendforce gauges. Be that as it may, the blackout there is probably going to influence Samsung’s mid-level telephones and PCs more than its top-of-the-range models or worker chips, said Greg Roh, a senior VP at HMC Securities.
Koh mentioned Samsung may decide not to introduce its Galaxy Note during 2021’s second half as the Note series is positioned as a high-end model in the business portfolio. Now, the Note model has been planned to be released next year.