Taiwan-based IC distributors including Answer Technology (ANStek), GMI Technology, WPG and WT Microelectronics have all seen a strong pull-in of orders for Wi-Fi and other networking chips with order visibility extending through the first quarter of 2022, according to industry sources.

The supply of networking chips, including those offered by Taiwan-based IC design houses such as MediaTek and Realtek Semiconductor, has been lagging demand with the supply shortfall set to persist throughout the second half of 2021, said the sources.

In particular, the supply of 802.11ac (Wi-Fi 5) chips is extremely tight, the sources indicated. The supply of 802.11ax (Wi-Fi 6) chips is less tight, but demand is expected to rise in 2022 for notebook and router applications, the sources said.

The tight supply of networking ICs resulting in the chip price growth also buoyed related IC distributors' sales performance thus far this year. GMI, for example, has disclosed its cumulative 2021 revenue through July surged 44.2% on year to NT$10.53 billion (US$375.8 million).

On the other hand, Taiwan-based IC distributors have seen customers defer their purchases of Wi-Fi FEM (front end modules) due to the ongoing shortage of 802.11ac and other Wi-Fi chips, according to the sources. Besides, demand for consumer ICs such as TWS earbud chips has been disappointing thus far in the third quarter, but may pick up in the fourth, the sources said.

In addition, Taiwan-based GaAs foundries have seen more of their networking IC clients focus more on Wi-Fi 6 products, the sources indicated. Demand for Wi-Fi 6/6E chips is poised to grow robustly in 2022, the sources believe.

By DIGITIMES