Broadcom is one of the world’s top suppliers of the semiconductor chips that form the brains of everything from smartphones to cars to gaming consoles. It currently has a backlog of orders stretching at least eight months long.
Broadcom’s inventory woes are the latest sign of a broader chip shortage snarling supply chains across the globe. Pandemic-fueled chaos in the supply chain for semiconductor materials created an initial backlog in the middle of 2020. Then, stronger-than-expected demand for cars, combined with a seasonal spike in smartphone sales, drove demand much higher than supply.
On a March 4 earnings call, Broadcom CEO Tan Hock Eng said semiconductor backlogs have increased “quite significantly” over the course of the first quarter of the year. “We have customers [who] are willing to book out for delivery of those products, out through the rest of 2021,” he said.
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