Realtek Chip Shortage Is More Bad News for PC, Components Market

It seems that Realtek has joined the long list of supply chain bottlenecks. DigiTimes today reported that the company is struggling to meet demand for the various chips manufacturers use in their notebooks, automobiles and other kinds of devices.

In the story, DigiTimes remarked that Realtek has extended their delivery lead times to 32 weeks as the capacity of the foundries is currently tight and there are shortfalls in the supply of the necessary raw materials.

Those chips are found in a wide variety of products. The audio+LAN chips are used in notebooks, for example, and the xDSL chips are being used in "smart city projects" by Samsung. But the shortage of networking equipment might be most worrisome.

Realtek is reportedly falling short of demand for wired networking (Ethernet chips and switches) and wireless communication chips such as Bluetooth. There are alternative solutions, of course, but Realtek is said to supply 70% of the audio+LAN chips used in the global notebook market. Manufacturers can't just find alternative suppliers for all those notebooks—especially during a global chip shortage.

All of this means that Realtek's problems are in many ways the rest of the world's problems. DigiTimes said the company's supply issues have caused production delays for notebook makers, the automotive industry and other sectors.

DigiTimes reports that Dell, HP, and other notebook manufacturers have raised concerns with Realtek, exerting pressure to ship more chips to meet the demand. But with supply issues extending even to Apple, the world's most valuable company, the relaying of concerns seems unlikely to solve the issue.

Those companies will just have to wait for Realtek's chips. Many will also be looking for improved supplies of other chips, display panels, display drivers, and many other components besides. Just don't expect those shortages to be addressed overnight.