id=”article-body” class=”row” section=”article-body”>
And it’s not just cars. There also are , and people have been camping out — during a pandemic — to buy Nvidia’s graphics processors. Even Qualcomm, the world’s biggest mobile chipmaker, can’t get enough processors to meet the demands of its handset customers.
It’s this situation — more than competition or a lukewarm consumer reception to 5G — that worries Qualcomm’s incoming CEO, Cristiano Amon. The 50-year-old Brazilian has been at Qualcomm since 1995 and became president in 2018. He’ll become only the fourth CEO in the 36-year-old company’s history when he takes over the helm from Steve Mollenkopf in June. With that role will come pressure to not only keep Qualcomm as the leader in mobile chips, but also expand the company into new markets with its 5G connectivity.
Amon described it as a “V-shaped recovery:” a huge dropoff in purchases, followed by a rapid return of demand. But component manufacturers couldn’t keep up with the surge. Automakers’ just-in-time manufacturing strategy, which has long benefited them, backfired. When the pandemic hit, they canceled orders, only to find the supply wasn’t available when demand returned.
“As more and more devices have gotten digital over the years — cars are the best example — the amount of semiconductor demand has grown to the point that people are battling over capacity that’s available,” Technalysis Research analyst Bob O’Donnell said.
At the same time, Huawei’s decline in the phone market has impacted the technology industry. Last summer, for a quarter, the first time in nearly a decade that Apple or Samsung hadn’t held the title. But US sanctions against Huawei are hurting its ability to sell devices, opening an opportunity for other Android handset makers to woo its customers. That creates even more demand for processors from companies like Qualcomm, but the supply chain wasn’t prepared for it, Amon said.
“So you add all of this together, we have an incredible crisis in the supply chain,” Amon said. The shortage is “impacting everything, and of course [is] impacting phones.”
Here’s what else Amon said in the interview.