The global semiconductor shortage that has already roiled the automotive sector is now being broadly felt, with companies in the tech and telecom sectors reducing their guidance to investors into 2022.
“Given the supply chain issues we face, we anticipate slightly negative player margins for Q2 and the likelihood of increasing negative player margins in the second half of 2021, given the anticipated component cost increases,” Roku CFO Steve Louden told investors last week during his company’s Q1 earnings call.
Roku reported a 22% year over year increase in hardware revenue in Q1, to $107.7 million.
CommScope, meanwhile, doesn’t expect a “fully normalized silicon supply environment” to return until early 2022. The company’s Home Networks unit ended the first quarter with more than $1 billion in backlog orders, which is more than twice its 2020 average. Sales for Home Networks, which makes pay TV set-top boxes and broadband gateways, fell 19% to $489 million in Q1, due in part to the supply chain-driven backlog.
“In terms of supply chain shortages, the main one that we're experiencing is in the Home business with our silicon products,” said CommScope President and CEO Charles Treadway, also in a Q1 call last week.
“We're not immune to the global supply chain constraints,” added Patrick Harshman, CEO of Harmonic, another key tech vendor to the telecom and video industries. “We're seeing shortages of several key components and related significantly higher costs impacting most significantly our DAA and shelf hardware products.”
Harmonic still saw quarterly revenue tick up over 42% to $111.6 million.
Global semiconductor supply has failed to keep up with the demand, as all kinds of sectors now include ever greater amounts of silicon in their products.
Last month, chipmakers including Intel, Nvidia and Taiwan’s TSMC warned their investors that semiconductor shortages could last until next year.
And sectors like automotive have already felt the pinch. U.S. automakers General Motors and Ford said in February that the semiconductor scarcity could cut into their full-2021 earnings by as much as $2 billion and $2.5 billion, respectively.
It should be noted that the impact of this chip shortage is somewhat uneven and not universally felt right now. Take for example Los Angeles-based Xperi—the tech company servicing sectors like automotive entertainment, and which recently paid $3 billion to acquire TiVo, reported minimal supply chain effects last week during its Q1 call.
“While it will trim the overall growth number by a few percentage points, we have yet to see, at least from people we are doing more business with, an indication that it's going to materially impact our business beyond what we've already factored in and thought about in our respective guidance range,” said Xperi CEO Jon Kirchner.
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