Speaking upon the release of Intel’s Q2 earnings, Pat Gelsinger said it would take ‘another one or two years’ for supply to catch up with demand.
Intel CEO Pat Gelsinger has said that the global semiconductor shortage could last into 2023, as the company posted quarterly earnings that slightly exceeded expectations.
Addressing shareholders on the release of the Q2 financials, Gelsinger said that while he expected the extent of the shortage to “bottom out” in the second half of 2021, “it will take another one to two years before the industry is able to completely catch up with demand”. In April, Gelsinger had said the shortage could last “a couple of years”.
Nonetheless, the company had a solid second quarter. For the three months to June, Intel returned adjusted earnings-per-share (EPS) of $1.28, a 12pc increase year-on-year and exceeding Wall Street predictions of $1.06. Adjusted revenue reached $18.5bn, a 2pc increase compared to the same period last year.
The chipmaker’s client computing group, which makes chips for PCs, saw revenue climb 6pc compared with last year, while revenue in its internet-of-things group jumped 47pc. Mobileye, the company’s self-driving car subsidiary, saw revenue shoot up by 124pc, but its division that makes computer memory fell by 34pc and its data centre group was down by 9pc.
The numbers prompted the company to boost its overall 2021 forecasts. It is now expecting to take in an adjusted $73.5bn in revenue this year, with EPS of $4.80.
Of the company’s performance, Gelsinger said: “Together, we will continue to sharpen our focus on execution, accelerate innovation and unleash the talent inside Intel. While there is more work ahead, we are moving at a torrid pace, and I look forward to providing several updates in the coming months.”
The worldwide chip shortage has been a matter of concern to everyone from industry players to political leaders. It comes at a time when Intel is struggling to meet its own targets for the release of new technologies, and the company has in the past year begun outsourcing more of its production.
Intel is, however, undertaking a number of moves to deal with an adapting marketplace. Earlier this month, industry veteran Shlomit Weiss returned to Intel to lead its consumer chip development team, after a four year absence. The chipmaker is also completing a large investment in its Irish facility and negotiating with the EU over bringing a $20bn new factory to Europe.
“With major fab construction projects underway in Oregon, Arizona, Ireland and Israel, we are investing for the future,” Gelsinger added on the earnings call.
“But we are also taking action today to find innovative ways to help mitigate industry constraints.”