Apple prevails as chip supply woes hit smartphone biz

These workers are not making semiconductors

Blood on the smartphone tracks as Counterpoint Research warns semiconductor shortages are beating up shipments – with Apple least affected as it continues to shift tens of millions of iPhone 13 models.

What Counterpoint says about smartphone sales

Counterpoint originally predicted a 9% annual growth in smartphone shipments to 1.45 billion units across 2021, but now anticipates “just” 6% growth (1.41b units) as semiconductor shortages bite.

The analysts claim smartphone vendors placed large component orders from the end of last year, which protected them against shortages at first this year.

Since then, smartphone OEMs and vendors are reporting they only received 80% (and now just 70%) of key components they had requested during Q2 2021. That situation appears to be getting worse.  Counterpoint Research believes 90% of the industry is affected. This will impact the second half forecast for 2021.

Apple seems to be the least affected

Tom Kang, Research Director at Counterpoint Research says in a press release:

“The semiconductor shortage seems to affect all brands in the ecosystems. Samsung, Oppo, Xiaomi have all been affected and we are lowering our forecasts. But Apple seems to be the most resilient and least affected by the AP shortage situation”.

I imagine this is because Apple has its own unique AP provided by TSMC; though recent claims around a delay to a move to new 3nm process technology may hint at similar challenges.

The industry across the year has been characterized by stockpiling essential components such as application processors, camera sensors, printed circuit boards and more.

Semiconductor shortages are rife despite factories running at full capacity for several quarters. Stockpiles are running low. Compounding this are low yields at some processor manufacturers, which is impacting upstream companies such as Mediatek or Qualcomm, the report states. And this further impacts smartphone makers reliant on components from them.

Infographic: Q2 2021 | #Semiconductors: https://t.co/q7uvBq4Gfl

Global #Smartphone AP Market Share by shipments, Q2 2021:
✓@MediaTek maintains lead at 43%
✓@Qualcomm rises to 24% on high-mid end #5G
✓@Apple gets 3rd with #iPhone12 momentum#smartphones #technews #technology pic.twitter.com/gs43PbzEyd

— Counterpoint (@CounterPointTR) September 29, 2021

What next?

The devil’s in the detail, I suppose. My take is that the scarcity of components will have an additional effect on new product release plans. That’s going to mean a different release cycle for devices at least into 2022.

While Apple isn’t apparently affected, we have seen some anticipated products fail to appear, which suggests the company is simply managing that impact.

This problem that may not be over by Christmas, and in conjunction with all the other clustered challenges we now face on a local, national, and international basis, we sure don’t seem to be in Kansas anymore.

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