Juniper Research: Coronavirus to Cause $42 Billion Revenue Gap in Global Consumer Device Shipments over the Next 9 Months
26 März 2020 - 8:00AM
Business Wire
Supply Chains to Continue Suffering Severe
Disruption
New analysis from Juniper Research found that Coronavirus
could cause around a $42 billion revenue gap over the next 9 months
for smart device vendors. The analysis examined a number of key
device verticals including smartphones, tablets, consumer robotics,
smart speakers and smart wearables. Three impact scenarios, low,
medium and high, illustrate a range of possible outcomes.
For further information, please watch our video
discussion on the topic and download our free whitepaper:
Coronavirus: The Impact on Consumer Device Supply
Chains.
Production Shortfall of 80 Million Devices
In our high impact scenario, the research forecast a reduction
in output of over 80 million devices over the next 9 months. Delays
to the delivery of components, such as batteries, processors, and
displays, will each have the potential to disrupt production rates
from device vendors. These, including Apple, Samsung,
Amazon, Xiaomi and Huawei, must all ensure
that any gaps in their supply chains are closed in order to meet
the demand for their devices.
The advisory note forecasts that smartphones will comprise the
majority of this device shortfall over the next 9 months,
accounting for over 85% of missed shipments. It anticipated that
the virus may also cause longer term issues, including the
development of new devices. Additionally, it noted that the
financial uncertainty from the impact of the virus means that
demand will be lower, leaving device vendors unable to completely
recover lost device sales.
Vendors Must Adapt ‘Resilient’ Strategies
The research urged device vendors to diversify their component
supplier bases, arguing that doing so will enable them to ensure
that future gaps in the supply chain are filled.
Just-in-time manufacturing has been a weak link in the
resilience of device vendor supply chains. This kind of
manufacturing involves organising supply chains to timed deliveries
of components immediately prior to the device manufacturing stage.
Whilst holding stock can be expensive, Juniper Research believes
that vendors must now consider building inventories of ‘strategic’
components.
Juniper Research provides research and analytical services to
the global hi-tech communications sector; providing consultancy,
analyst reports and industry commentary.
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Sam Smith, Press Relations T: +44(0)1256 830002 E:
sam.smith@juniperresearch.com