Chips Supply/Demand ‘Balance’ to Return by Late 2021: On CEO
“Steep acceleration” in demand for chips in “end markets” across the board in hampering On Semiconductor’s ability “to supply certain products, especially those manufactured by our foundry partners, and in certain pockets, products manufactured internally,” said CEO Hassane El-Khoury on…
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a Q1 call Monday. “We’re working diligently with our manufacturing partners to assure timely supply of our products to our customers.” It took steps “to ensure continued supply to our strategic customers by building inventory on our balance sheet and reducing inventory in the distribution channel,” he said. “By having better control over inventory, we are able to quickly respond to the needs of our strategic customers.” El-Khoury expects the higher “velocity” of increased demand will begin to “subside” in 2021's second half, “but will remain at a very healthy level,” he said. “We expect supply and demand to get back in balance when demand stabilizes later this year.” He conceded Q1 revenue of $1.48 billion “could have been higher if we didn’t have constraints in a perfect world.”