Major tech giants are vulnerable to Intel’s chip production issues

Major tech giants are vulnerable to Intel’s chip production issues

The rising demand and shortfall of supply has caused a major disruption in the functioning of the technical community and is hurting the tech giants such as HP, Microsoft, and Apple. Intel’s CPU shortage started last year and the bottleneck is still prevailing with no major commitments to when the 14 nm chips will be available. According to the reports, Intel has invested around $1 billion into its 14nm chip production site and claims that the issue will be resolved very soon. If sources are to be believed, Intel’s exclusive deal to Apple initiated the problem where Intel is trying to pitch its 14nm chip in the production of iPhone modems.

The problem is promised to be resolved in mid-2019 but DigiTimes claims that the chip shortages can worsen in the second quarter leading to a higher gap in the demand-supply scenario. As the market is evolving with Chromebooks and other low-end PCs, Intel requires managing their production lines to meet the deficit and surpass demand.

The problem for HP and Microsoft

Apart from Apple, HP and Microsoft are also facing the major issues with this problem and both of them have been leading the PC market. Around two-thirds of the revenue for both companies comes from PC sales. Although the desktop shipment has dropped to 8%, the requirement for an Intel chip is still high. So, the ecosystem is right now unbalanced for these three tech giants and the spokesperson from each of these companies have said that they expect the shortages to overcome soon enough for full-fledged production of their smart devices in near future. However, Apple might have to make peace with Qualcomm after they broke off the ally over the escalation of legal disputes.

So, Intel’s chip shortage has hit the tech market hard and the shock waves will continue to plunge the economy till the shortages are met. The stat shows that this shortage will not hold lasting damage to the stated companies but can throttle their term growth for a short period of time.