TSMC, Nvidia, and Intel Say That the Global Chip Shortage Will Continue till 2023: Report

Apr. 24, 2021

The Chip Shortage

Now, if you are unaware of what I am talking about, let me give you a quick brief. As more and more things have started becoming, what we call “smart”, the demand for system-on-chips has been exceeding the supplies from manufacturers. Due to this, many of the companies are not able to purchase as many silicon chips as they need because of low supply. It is affecting the smartphone industry too as Samsung, followingearlier reports, has already announced thatit will not launch the Galaxy Note series this year.

So, as per reports, in a recent call with industry analysts, the Taiwanese Semiconductor Manufacturing Co (TSMC), which is the world’s largest chip manufacturing company, stated that the severity of the current chip shortage will likely reduce in the coming days. However, the overall shortage of silicon chipsets will continue this year and may even extend to the next.

The company reportedly said that it is operating at“over 100 percent utilization”to meet the current chipset demands. Moreover, citing the current situation, TSMC also stated that it will invest around $30 billion for expansion as its gross margin dropped to 49.5 percent as compared to 51.5 percent, which the company expected to achieve this year. In addition, the Taiwanese chip giant also stated that it expects revenue to grow 20 percent over last year.

Nvidia, which is one of the clients of TSMC, also commented on the situation by stating the“overall demand remains very strong and continues to exceed supply while our channel inventories remain quite lean”. Furthermore, the company added that it expects this disbalance between the demand and supply of SoCs to continue throughout this year.

Intel CEO Pat Gelsinger alsospokeabout the topic withThe Washinton Postand gave similar responses. As per Gelsinger,“it just takes a couple of years to build capacity,”and due to this, creating enough supply takes a bit of time. So, speaking about the chip shortage, Gelsinger said,“I think this is a couple of years until you are totally able to address it.”

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