Here's some bad news: Cisco CEO Chuck Robbins told Yahoo Finance Live today that he thinks it could take "a couple years" for the ongoing chip shortage to finally end.
Here's some worse news: Intel CEO Pat Gelsinger agreed with Robbins. "We can't build fabs overnight," he told Yahoo, "it takes a couple of years to get built up."
This isn't the first we've heard about the shortage lasting more than a few quarters. AMD CEO Lisa Su issued a similar warning in January when she said the company simply couldn't keep pace with the higher-than-expected demand for its products.
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Analysts also predicted in February that the chip shortage would continue for at least a year because, by their estimates, demand outpaces supply by about 30%. That's a significant gap that would take fabs several quarters—at least—to close.
Asus and MSI also said earlier this month that supplies of Nvidia GPUs, including some that power the best graphics cards, fell even further in the first quarter of 2021. MSI chairman Joseph Hsu told investors that he expected graphics cards prices to rise throughout the year because of that shortage.
Many forward-looking statements have been fairly hopeful for 2022, however, as fabs make significant investments to increase production capacity. But that doesn't mean the problem will be solved; it simply means it won't be as bad as it is now.
"I think we see a few quarters of real stress in the supply chain, and we think that it will be more predictable. It may not be where we want it to be, but it will be more predictable," Robbins told Yahoo, adding "We just got to fight our way through it."
It's kinda like turning a doorknob that shocks you when you touch it. The first time is the worst because it comes as such a surprise, but eventually you can start to plan around it. Maybe you wear rubber gloves; maybe you just steel yourself for the pain.
Put another way: If you're aware, you can prepare, and now companies are very aware that the chip shortage isn't going to end when the calendars turn over. It seems that Cisco at least has embraced this reality; others will likely follow suit.
