The COVID-19 dent in the European semiconductor distribution market seems to be over. While Q1 was still negative, Q2/CY21 more than compensated for it and ended up with 25.2% growth to over EUR 2.3 Billion combined distribution revenue of all DMASS members (semi only).
Georg Steinberger, chairman of DMASS: “As indicated a few months ago, the dominating questions this summer are: where to source components to avoid production stops at customers and how long will the shortage last? In both cases the answers are pretty much open. Predictions on the shortage longevity range from anywhere between right after this summer to way beyond the summer of 2022. The unknown in that case is not production, as new capacities will not come online any time soon, but the more than fuzzy demand from the customer side. 2021 is probably safe from a sales perspective and will end up between 15 and 20%, but beyond that…”
At a country or region level, the overall situation is extremely positive, with double-digit growth almost across the board, but the variations are quite significant. While Northern and Eastern Europe, the UK, Iberia, Benelux, Italy, Turkey and some smaller countries (a.k.a. Rest of Europe) grew between 28% and 77%, Germany ended up with 15.1% growth, France with 19.8%, Israel with 14.7% and Russia with 7.7%. Germany ended with +15.1% to EUR 614 Million, Italy with +30.4% to EUR 212 Million, the UK with 37.3% to EUR 167 Million, France with 19.8% to EUR 149 Million, Eastern Europe with 44.1% to EUR 403 Million and Nordic with 28.4% to EUR 180 Million.
Georg Steinberger: “What is interesting to note is that especially France and Germany as the major EU countries have difficulties in keeping up with the average growth rate. What is also quite amazing is the fact that the UK does not seem to struggle at all with any Brexit ramifications, at least not in the components business. Not that I want to indicate anything here.”
At a product group level, the development in Q2 has been almost entirely positive. If any areas seem to “struggle”, it would be Analog, MOS Micro, Programmable Logic and Other Logic. In descending order, Discretes grew by 58% to EUR 139 Million, Memories by 49% to EUR 214 Million, Power by 41.6% to EUR 282 Million, Sensors by 37.9% to EUR 66 Million, Opto by 33.2% to EUR 222 Million, Analog by 22.9% to EUR 663 Million and MOS Micro by 19.9% to EUR 463 Million. Programmable Logic on the other hand declined by 11.8% to EUR 114 Million and Other Logic by 4% to EUR 109 Million.
Georg Steinberger: “What we are seeing at the product level is most probably an effect of the shortage that seems to have had a bigger impact on the major product groups of Analog and MOS Micro. The same might be true for Other Logic. Beyond that, it is really dependent on the mix of manufacturers and their specific delivery situation in the various product areas.”
“While 2021 looks like being pretty much in the bag, the jury is still out on how long the shortage may last. The much bigger game going on here is the perception that semiconductors are the ‘new Oil’ and governments need to get involved to secure access to leading-edge technology, which, if it happens, will have long-term effects on the entire semiconductor food chain and pricing. Government intervention always has a price tag that customers have to pay at the end.”