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Reports: Coronavirus Sending Rippling Damage Throughout Tech Industry

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With a handful of RAM factories located in China, DigiTimes reported today that under 30% of factory employees have returned to work amid the coronavirus outbreak. DigiTimes reported today that fewer than 30% of factory employees have returned to work, citing unnamed "sources in the memory industry."

The publication also cited anonymous sources "from the upstream supply chain" and claimed that some factories, namely ODM plants based in Kunshan, China and owned by Taiwan-based companies, have only seen about 1,000 out of 9,000 employees return to work.

Sources in the RAM supply chain reportedly believe that materials inventories could "fail to support their output after mid to late February."

Before the outbreak, low RAM prices were driven by huge inventories and typical market fluctuation. At the beginning of this year, there were predictions that DRAM and NAND prices would rise as much as 40% throughout 2020. But with the coronavirus outbreak impacting the tech industry and the world, the future is uncertain.

Meanwhile, it's already been reported that consumer demand in China for graphics cards and motherboards has already dropped

Unnamed Digitimes sources also claimed Acer and Asus, which have large customer bases in China, are experiencing large setbacks, with Acer's January revenue stream down by 41.8% and Asus' stream down by 29.1%. These drops were attributed to a combination of the labor shortages in local factories, reduced supplies from their supply chain and reduced demand from local markets. 

If the reports are true, it could mean that coronavirus will play a significant role in how various tech markets perform this year. 

"Since Asustek has a large portion of motherboard, graphics card and gaming notebook shipments to China, the Taiwan-based brand's profitability in the first quarter is expected to slump dramatically," DigiTimes said. 

"Since labor and components shortages are unlikely to be fully resolved before mid-March, the two Taiwan-based brands' operations in the second quarter may remain weak."

Niels Broekhuijsen is a Contributing Writer for Tom's Hardware US. He reviews cases, water cooling and pc builds.