Intel CEO expects chip shortage to last until at least 2024

Intel CEO Pat Gelsinger in an interview said that he expects the semiconductor industry to suffer supply shortages until 2024. Gelsinger explained that the issue may drag on due to a lack of key manufacturing components.

“In the supply chain, lockdowns in Shanghai and the war in Ukraine have demonstrated more than ever that the world needs more resilient and more geographically balanced semiconductor manufacturing,” he said.

The chip shortage cost the US economy $240 billion last year.

“We expect the industry will continue to see challenges until at least 2024 in areas like foundry capacity and tool availability,” Gelsinger told the analysts.

The chip-maker registered record quarterly revenue at $18.4 billion in the first quarter, slightly exceeding its guidance. Its net income skyrocketed by 141 per cent to $8 billion.

Gelsinger said that the company continues to see some softening in low-end consumer PCs, and some inventory adjustments.

“But overall, the demand signals from customers continue to be robust in areas like enterprise, cloud, AI, graphics, and networking. Semiconductors are the fuel of innovation and transformation across a wide range of industries,” he explained.

Intel recently announced a series of investments in the US and Europe.

“These investments position Intel to meet the future growth and represent a significant step toward our moonshot goal of having half the world’s semiconductor manufacturing located in the US and Europe,” said the chip-maker.

According to Counterpoint research, Global semiconductor chip shortages are likely to continue easing during the second half of 2022 as demand-supply gaps decrease across most components.

These shortages have plagued many industries for the past two years and vendors across the supply chain have spent much effort dealing with uncertainties. Since late 2021, demand-supply gaps have been shrinking, signaling an approaching end to supply tightness across the broader ecosystem.

Inventory levels of 5G-related chipsets including mainstream application processors, power amplifiers and RF transceivers have increased significantly in 2022 Q1, easing the shortage for smartphone components rapidly. Though some exceptions still exist, like older-generation 4G processors as well as power management ICs.

(With inputs from IANS)

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