The ongoing shortage of notebook-use chips, panels and other components is expected to improve substantially in the fourth quarter of 2021, according to Digitimes Research.

Supplies of panel modules, ICs and CPUs are still over 10% short of demand at the moment and may expand to over 20% later in the third quarter for some specific panels and ICs, as brand vendors build up their notebook inventory for year-end holiday shopping, and component supply is unlikely to see major improvements.

But notebook demand is expected to drop significantly in the fourth quarter; the pandemic will gradually come under control; and additional production capacity for ICs will become available. Component shortages are expected to improve dramatically then.

Pull-ins of 11.6-inch panels have started decelerating recently, since most brand vendors have already prepared sufficient inventory of the panels, while shipments of Chromebooks, which are key adopters of such panels, to the education segment will begin to slip after hitting the peak in the second quarter.

However, vendors' shipments will turn to traditional consumer and enterprise notebooks due to seasonality, and keep overall demand for notebook panels in high gear, especially that for 14- and 15.6-inch panels.

Timing controller (Tcon) and panel driver ICs are chips that have the most serious shortages for panels.

Tcon ICs' supply, which is over 20% short of demand currently, is expected to grow tighter later in the third quarter, as their suppliers have shifted some of their Tcon IC capacity to produce other products, and power outage at some wafer fabs in the second quarter also undermined some of the supply.

The driver IC shortage will begin to ease in the third quarter as Taiwan- and China-based wafer foundries' new large-size display drive IC (LDDI) capacity has started entering volume production since the second quarter.

Notebook demand is expected to slow down in the fourth quarter, with North America and Europe, the keenest in procuring notebooks, to begin lifting lockdowns and students there returning to school. Wafer foundries' new capacity coming online at their 8- and 12-inch facilities is also expected to help narrow the supply gap.

By: DocMemory
Copyright © 2023 CST, Inc. All Rights Reserved