Shortages of chips and components used in industrial PCs (IPC) have eased, which will boost IPC shipments in the third quarter of 2022, according to industry sources.
IPC players expect positive growth in the third quarter, driven by steady demand and steady pull-in momentum.
IPC companies have been actively digesting on-hand orders, which drove August revenues and reserved sufficient growth momentum for the third quarter.
According to market watchers, if the supply of network IC key components continues to recover, production lines will rush to ship goods in hopes of quickly shipping out previously deferred orders, which will drive revenue growth compared with 2021.
IPC players noted that demand for traditional applications such as food and beverage, gambling, energy, transportation, industrial automation, and network security remains stable. Demand is also being driven by the popularization and development of artificial intelligence (AI) in agriculture, medicine, and finance. Related-product demand is expected to further drive future growth momentum.
The popularization of cloud and remote applications has also increased network-security-related demand, according to IPC companies.
Sources noted that the industry will continue to improve production efficiency through automation, and companies will continue to develop automated, smart equipment. As such, despite current interest rate hikes, inflation woes, and geopolitical instability, related market demand has yet to be significantly affected.
While most shortages have already been relieved and companies have adjusted inventory levels, sources pointed out that some components and materials are expected to remain short through fourth-quarter 2022 or first-quarter 2023.
However, companies also emphasized that these components are available, they are just not in full supply. They added that prices on the spot market are also not as exaggerated as before. Companies are currently working hard to quickly ship out previously-held orders that have accumulated.
The situation regarding "long orders" within the industry has also changed, according to sources.
IPC companies noted that customers previously were placing long orders due to shortages, hoping they could obtain more materials by placing long orders and were not necessarily a reflection of actual demand. Now that the shortages have eased, there is no longer a need to place long orders to stockpile materials. Although long orders are shrinking, overall, it is healthier for development.
