Global Chip Sales Down on Thai Floods, Eurozone Crisis

Pulkit Chandna

Flood waters may have receded in Thailand, but the hard drive industry is still reeling under the effects of the disaster. The impact hasn’t been restricted to the hard drive industry alone, though. The ensuing hard drive shortage has lead to serious supply chain disruptions in the PC industry, impacting everyone from PC vendors to chip makers.

According to the Semiconductor Industry Association (SIA), global chip sales during the month of November 2011 fell 2.4 percent from the month before to end up at $25.1 billion. The trade group attributes this to “supply chain disruptions resulting from the floods in Thailand” and the ongoing financial crisis in Europe. However, it believes that the impact of the floods won’t last for too long and expects OEMs to recover production losses over the next few months.

This report comes a few weeks after Intel cut down its revenue guidance for the fourth quarter by as much as $1 billion. The world’s largest chip manufacturer had also blamed ongoing hard disk drive supply shortages for its decision to lower guidance.

“Supply chain disruptions resulting from the floods in Thailand have impacted semiconductor sales in the near term, however OEM’s are expected to recover production losses over the course of the next few months,” said Brian Toohey, president, Semiconductor Industry Association. “November sales were additionally affected by the continuing European financial crisis which is having a broad impact on other economies and global demand.”

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