The supply-chain crunch of the past year quickly became so bad that some firms even bought other companies’ appliances to strip them for the specialised semiconductor components they contained. It was a situation the industry had not experienced in a quarter of a century.
The years of sluggish economic growth since the 2008 crisis lured many into the false sense of security that the chipmaking sector could pretty much make whatever customers wanted. But, on the way out of the sudden Covid-lockdown slump, buyers were surprised that the industry was not in a position to fill gaps in their inventories. For long-term observers of the market, the supply crunch was not unprecedented but the resumption of normal behaviour.
“Semiconductors was, is and will be a cyclical industry. At the same time, the industry is kind of bad at predicting things,” Charles Shi, senior analyst at financier Needham & Company, explained at the Design Automation Conference in July...