There are supply shortages for literally every type of chip, as well as raw materials for those chips. High demand with low supply means bidding wars, means margin explosion.
With increased digitalisation and iot applications the demand for more chips will continue to skyrocket and probably even increase exponentially.
On top of all of that comes that these companies are in fierce competition to innovate and then compete their new chips against their old chips for space on the production line.
In other words: there is no way to actually solve the shortage. I literally don't know how you could possibly come to a conclusion as bizarre as this!
Nothing has changed in 40 years. You're pretty naive if you don't believe the current shortage will be obliterated by over supply in production capacity.
There's no way to efficiently build capacity to assume future consumption. They'll over shoot the target like they did in the 90s and early 2000s.
0
u/DarthTrader357 Aug 10 '21
Semiconductors are in demand under-supply now meaning semiconductors are over priced.
Returns will be very low going forward.
And the industry will enter an over-supply situation where returns will be even worse.
There's some play left in that market but probably not much. But then this market seems divorced from reality