Embedded Tech Specialist Advantech Warns Component Shortage Will Slow Growth

COVID-related silicon supply chain issues have impacted core information technology products, according to Taiwanese industrial tech specialist Advantech.

Speaking at an investor’s meeting yesterday, the company's president of Embedded and IoT products Miller Chang described positive sales growth in Q4 2020 and Q1 2021 with Q1 2021 book-to-bill ratio ( incoming orders vs. outgoing orders) at 1.52 and annual booking Q1 growth rate expected to reach 50 per cent.

“However,” stated Chang, “due to component shortages and long lead times, an estimated 5-10 per cent impact in the second quarter Y2020 is expected.”

The company has scrambled to implement measures that deal with the supply shortage amid high demands. Advantech procurement is asking suppliers to set aside parts for them for the next 12 months.

Advantech's woes means it joins the automotive sector in blaming revenue decreases on the chip shortage.

The Taiwanese company's products include an product mix includes industrial PCs, embedded computers, servers, motherboards, cloud equipment and edge platforms. Its clients include big name like IBM, Amazon and Cisco.

Which brings the component crunch a little closer to home for Reg readers.

Advantech’s supply issues are not surprising as the world faces an unfortunate combination of a chip shortage and high PC manufacturing demand that has places like Taiwan trucking in water just to prevent a pause in semiconductor manufacturing.

Advantech customers can expect a price increase of 5 per cent from April to reflect the supply problems and to discourage hoarding and overbooking. ®