Report: Coronavirus Causing Struggles for Laptops, Semiconductors, Upcoming iPhone

(Image credit: Shutterstock)

According to DigiTimes research shared today, integrated circuit (IC) design companies in both China and Taiwan will see a major negative impact on their revenues in Q1 2020 with foundries expected to suffer in Q2, all due to coronavirus. According to the report, the outbreak will causes issues for the semiconductor, laptop, smartphone and display panel and markets in H1.

Laptops Expected to Suffer the Most

As much as 90% of notebook manufacturing happens in China, DigiTimes said, noting that the sector has been hit in terms of both component supply and consumer demand. According to DigiTimes, Taiwanese ODMs, such as Compal Electronics, Quanta Computer and Wistron, have resumed operations at their plants in Chongqing, Kunshan and Shanghai, China but only at 20% capacity. 

The plants are expected to increase capacity utilizations starting February 24, when a 14-day quarantine at their component suppliers will end. But the ODMs will reportedly still need to recruit new people because the rates of returning employees are quite low and more people are looking to work in service instead of manufacturing. 

Semiconductors

According to the report, the highly automated foundry plants in China will only be minimally affected by the outbreak in Q1, as they were already expecting a lower run due to Lunar New Year. 

However, their revenues will start to weaken in Q2 as lower consumer demand and delays in product launches are expected to slow inventory depletion for semiconductor companies. Furthermore, shipments of 5G chips will probably not see a significant increase until Q4, DigiTimes predicted. 

New iPhone at Risk

Four of the largest Chinese smartphone makers, Huawei, Oppo, Vivo and Xiaomi, are expected to lose 15.2% of their quarterly shipments total, which will fall to 84 million units. Some smartphone parts suppliers are expected to operate at only 50% capacity utilization until the middle of March, according to DigiTimes’ research.

Foxconn is also suffering from "uncertainties in employee returns" to its China-based plants, and this is expected to decrease "shipments of a new entry-level iPhone model by 10% in the spring and affect scheduled normal shipments of new iPhones in the autumn," the publication said. 

DigiTimes said Apple rival Samsung should be more immune to the outbreak due to heavier manufacturing in Vietnam and India.

Even LCDs Are Affected

Three of the major Chinese LCD panel makers, BOE Technology, Tianma Microelectronics and China Star Optoelectronics Technology (CSOT), are all based in Wuhan, the center of the 2019-nCov outbreak. CSOT has been impacted the most by the outbreak, reportedly operating at only 30% capacity as many workers were put in quarantine or sent home.

CEC Panda LCD Technology's Nanjing plant, BOE Technology's plants in Chongqing and Hefei, as well as Century Technology's plant in Shenzhen will be closed until February 17, so their shipments are expected to be at least somewhat affected by the outbreak.

Meanwhile, Chinese AMOLED display panel makers, such as EverDisplay Optronics, Visionox and Royole, will not be as impacted because they mostly import their components, DigiTimes said. 

Lucian Armasu
Lucian Armasu is a Contributing Writer for Tom's Hardware US. He covers software news and the issues surrounding privacy and security.
  • velocityg4
    While the coronavirus is the focal point. It isn't the coronavirus causing the downturn in production. It is the government response to the coronavirus.
    Reply
  • nofanneeded
    velocityg4 said:
    While the coronavirus is the focal point. It isn't the coronavirus causing the downturn in production. It is the government response to the coronavirus.


    China is doing very well to fight the virus , you just wait and hope this virus was spread by nature and not by some criminal covert mission to cripple china Economy and force companies to move out of Chia like Trumps dreams. if China prves this was man made , and the virus was planted , then ww3 is soon to happen.
    Reply
  • gg83
    nofanneeded said:
    China is doing very well to fight the virus , you just wait and hope this virus was spread by nature and not by some criminal covert mission to cripple china Economy and force companies to move out of Chia like Trumps dreams. if China prves this was man made , and the virus was planted , then ww3 is soon to happen.
    Lol. I read the virus came from a small mammal with "scale" like skin.
    Reply
  • S.I.R.O.
    gg83 said:
    Lol. I read the virus came from a small mammal with "scale" like skin.
    Armadillo?
    Reply
  • bit_user
    nofanneeded said:
    you just wait and hope this virus was spread by nature and not by some criminal covert mission to cripple china Economy and force companies to move out of Chia like Trumps dreams. if China prves this was man made , and the virus was planted , then ww3 is soon to happen.
    Why would you spread this nonsense?

    The proposition is absurd. Nobody would use such a virus as an economic (or any other kind of) weapon, given the potential for it to spread world-wide. And you're right that if a group or nation did so intentionally, then the consequences would be severe. That's all the more reason why it's so ridiculous.

    If you look at the most rational explanation, this virus is basically a variant of the SARS virus. It's not at all surprising that there would be such viruses in the wild. If China would clean up its meat markets and ban trade in meat of wild animals, then this outbreak likely wouldn't have happened.

    Please don't use these forums to spread conspiracy theories. It does nobody any good.
    Reply
  • Giroro
    A clean room in a semiconductor plant is maybe the safest place in the world you could be in the event of a viral outbreak.
    Reply
  • bit_user
    Giroro said:
    A clean room in a semiconductor plant is maybe the safest place in the world you could be in the event of a viral outbreak.
    Until you have to eat, drink, or go to the bathroom. D'oh!

    Or, maybe there's someone else in there that has the virus.

    Clean rooms are positively-pressurized. Quarantine rooms are negatively-pressurized (with the exhaust presumably being filtered/heated/etc.)
    Reply
  • Giroro
    bit_user said:
    Until you have to eat, drink, or go to the bathroom. D'oh!

    Or, maybe there's someone else in there that has the virus.

    Clean rooms are positively-pressurized. Quarantine rooms are negatively-pressurized (with the exhaust presumably being filtered/heated/etc.)

    Positive pressure is a good thing If you are trying to keep a virus out. Quarantine rooms are negatively pressurized to keep the virus IN.

    I mean, I would say that a submarine might be the safest place, but we've all seen how fast sickness spreads on other kinds of ship. ;p
    Reply
  • bit_user
    Giroro said:
    Positive pressure is a good thing If you are trying to keep a virus out. Quarantine rooms are negatively pressurized to keep the virus IN.
    Yeah, I get that. My point was in relation to someone else being in there with the virus. If negatively pressurized, you might be slightly better off, as the virus will be more likely to get exhausted out and the air you breathe is more likely to be fresh. Of course, negative pressure won't help if they're standing right next to you, or if you happen to be between them and the exhaust vent.
    Reply
  • nofanneeded
    bit_user said:
    Why would you spread this nonsense?

    The proposition is absurd. Nobody would use such a virus as an economic (or any other kind of) weapon, given the potential for it to spread world-wide. And you're right that if a group or nation did so intentionally, then the consequences would be severe. That's all the more reason why it's so ridiculous.

    If you look at the most rational explanation, this virus is basically a variant of the SARS virus. It's not at all surprising that there would be such viruses in the wild. If China would clean up its meat markets and ban trade in meat of wild animals, then this outbreak likely wouldn't have happened.

    Please don't use these forums to spread conspiracy theories. It does nobody any good.

    When you have the vaccine , it is safe and profitable as well . not only you can cure your people , you can sell the vaccine 10 folds and profit from it from your enemy and make them beg for it and beg for an economical deal.

    "we are smarter we made a vaccine , we will not give it to you unless you pay such and such and sign such and such trade deal withus"

    "it will take us a year to make it" yea RIGHT

    and for the country that used Agent Orange in vietnam , I believe they are capable of anything.
    Reply