Industries affected by a semiconductor shortage, from automakers to consumer electronics, might need to wait a little longer for components, as delays in filling orders continue to worsen.
Chip lead times, the gap between ordering a semiconductor and taking delivery, last month increased by seven days to 18 weeks from April, an indication that chipmakers’ struggles to keep up with demand are worsening, Susquehanna Financial Group said a report.
That gap, the longest wait time since the firm began tracking the data in 2017, is more than four weeks longer than the previous peak in 2018.
Photo: Bloomberg
Power management chips, semiconductors that regulate the flow of electricity in everything from industrial machinery to smartphones, are a primary reason for the overall increase.
Lead times for those chips hit 25.6 weeks, nearly two weeks longer than in April.
Still, the crunch is widespread.
“The broad-based nature of the shortages is highlighted by the data, as most key product categories (power management, discretes, analogs, passives) have seen LT [lead time] expansion,” Susquehanna analyst Chris Rolland wrote.
Investors watch lead times looking for clues about how demand is trending, but also as a sign that chip users might be panicking and ordering too much, which would mean the industry is headed for a glut.
That point has passed, Rolland said, adding that his concern is that there is not enough demand for the end devices that rely on the electronic components to support current ordering levels.
While overall lead times stretched for firms such as Broadcom Inc, NXP Semiconductors NV, STMicroelectronics NV and Texas Instruments Inc, some areas are beginning to catch up with demand.
Lead times for microcontrollers, small processors that direct functions in everything from vehicles to washing machines, decreased by more than one week, Rolland said.
Lead times for analog chips, devices that convert real-world phenomena such as touch and sound into electronic signals, increased, but at a slower pace than previously, Susquehanna data showed.
Optoelectronic components, including chips that help convert solar energy into electricity in solar panels, are increasingly difficult to find, the report said.
While most of the firms listed as struggling to keep up with orders count automakers as major customers, other areas have felt the pinch, too, with many electronics makers, including the biggest companies such as Apple Inc, unable to meet all of the demand for their products.
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