back to article Party on Semiconductor Street as worldwide 2021 revenues top record half a trillion dollars

Semiconductor giants enjoyed soaring revenues in 2021 as global sales topped the half-trillion-dollar mark for the first time against a backdrop of squeezed supply chains. Preliminary numbers by tech analyst Gartner put revenues at $583.5bn for 2021, a jump of 25.1 per cent on the previous year with demand and raw material …

  1. Jellied Eel Silver badge

    Chips with everything

    Thing that struck me from that survey is the sheer number of ICs being produced. So well over 1bn a day. Which I guess shouldn't suprise me with the number of things being made. Fun times for makers of things though.

    1. ShadowSystems

      Re: Chips with everything

      Thank you for pointing that fact out.

      There is the ability to crank out over a *BILLION* chips *PER DAY* and yet we're supposed to believe that supply can't meet demand. Which leads to higher prices, which leads to over *Half A Trillion* in profits.

      I'll vote with my wallet, & it's staying shut until the shortage is over...

      1. Jellied Eel Silver badge

        Re: Chips with everything

        As I understand it, the shortages are for certain chips due to demand for SOCs, GPUs, memory etc. A friend said it was for stuff going into ICE and competition for other entertainment systems. Plus various ECU & automotive 'brain' units, which has competition from industrial automation. And then demand from everyone for Ethernet & wireless components.

        And then there's all the fabless IC designers who designed for clients, but didn't book fab plants to produce the chips. Apparently it can also be common for fab plants to bump one client if a higher paying one comes along.

        1. Pascal Monett Silver badge

          Re: bump one client if a higher paying one comes along

          I wonder how much longer that is going to continue. After all, it's not exactly very customer-friendly, right ? With all the new fabs that are either in construction or planned in the next few years, some fab plants might soon find that a number of their customers have gone off to other fabs who actually respect their contracts.

          Maybe.

          1. Jellied Eel Silver badge

            Re: bump one client if a higher paying one comes along

            Well, interesting times ahead.

            I think in a large part, it's Western business philosophy & JIT. But that's a broad problem. I remember a sales person once getting all excited about a massive opportunity with AOL. Which presumably meant they'd slept through their induction. Where the CEO had standing orders that anyone dealing with AOL would be fired. Basically they were notorious in the industry for screwing suppliers. So things like a 2 supplier policy so one's played off against the other etc. But blacklists exist, and some 'business partners' find they can't get quotes, or only for standard services on standard terms.

            Telcomms is by no means unique, ie supermarkets vs suppliers. Or even our current energy 'crisis'. GazProm wanted long term contracts, buyers didn't want to commit, demand exceeds supply and prices rise. As I understand it, tech companies like Apple are also practitioners of adversarial supply chain management. So they shouldn't be entirely suprised if/when their partners flee an abusive relationship.

  2. Sirius Lee

    Surely executives at chip manufacturers are realizing if they make and ship less of their product ensure a continuing 'shortage' they can increase revenue and profit. Given this background, why would any rationale executive ever make sure there is enough supply to meet demand. These economics would require that if demand drops so there is an over supply the manufacturer should destroy the excess product so the 'shortage' is maintained.

    1. Doctor Syntax Silver badge

      Let's do a thought experiment.

      The industry is working along those lines. You're a decision maker at a vendor. You realise that there's a whole lot of potential new customers out there that your company can supply by not artificially restricting output. What do you do?

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