Santa Clara, California, USA - March 29, 2018: Entrance of The Intel Museum in Silicon Valley. Intel is an American multinational corporation and technology company.
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Intel CEO predicts the chip shortage will extend to 2024

According to Intel boss Pat Gelsinger, the global chip shortage is here to stay till 2024. However, his own company is well-taken care of.

As tech companies continue to groan under the burden caused by the ongoing chip shortage, Intel CEO Pat Gelsinger has some bad news; we just have to cope with it till 2024. This was six months after he predicted the shortage would last till next year.

Speaking to CNBC, Gelsinger said, “[W]e believe the overall semiconductor shortage will now drift into 2024, from our earlier estimates in 2023, just because the shortages have now hit equipment and some of those factory ramps will be more challenged.”

The chip shortage has not affected every company the same way. This is because some types of chips are more available than others. Also, some companies have been able to manage the crisis better. For example, Tesla was able to rewrite its software to work with a different kind of chip which, apparently, was not as scarce.

However, even Tesla had to ship its cars without some ports. Other carmakers also had to pause production or remove some features.

Gelsinger observed that Intel’s own chips had not fared badly. He revealed their own foundries have been close to meeting customers’ demand during the company’s Q1 2022 earnings call.

By saying the shortage would persist till 2024, Gelsinger was referring to the industry’s capacity to meet demand based on the combination of new lines and existing ones. He elaborated, “We expect the industry will continue to see challenges until at least 2024 in areas like foundry capacity and tool availability as an IDM.”

The industry most hit by the shortage is gaming and computer manufacturing, with consoles being the worst hit. However, reports suggest things are beginning to get better. But chips for networking products are still affected. Gelsinger even mentioned Ethernet as a challenging ecosystem supply constraint that has seriously affected PC shipments.

However, when explaining Intel’s Client Computing revenue is down, the CEO gave another reason. The segment is responsible for consumer processors and the like. Intel said the drop was caused by Apple shifting to its own CPU and modem in its products. The company also blamed “OEM inventory burn” and “lower consumer and educational demand.” The last reason is basically about Chromebooks seeing decreasing demand.

Intel has been making massive investments in new production facilities despite the chip shortage. It is constructing new fabs in Ohio, Arizona, and Germany. However, going by the timeline presented by Gelsinger for the shortage to go away, none of the fabs will be ready in time.

Written by HackerVibes

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