Chip crisis: Christmas shoppers face disappointment, Arm boss warns

Simon Segars, chief executive of chip firm Arm, said the mismatch between supply and demand is “the most extreme” he has ever seen.

The “unprecedented” crisis won’t be completely fixed by Christmas 2022, he predicted.

In some cases, the wait for chips was taking 60 weeks, he said.

With just over 50 shopping days until Christmas, the clock is ticking.

“If you haven’t bought all your devices yet, you might be disappointed,” he warned delegates at the Web Summit event in the Portuguese capital, Lisbon.

“It has never been like this before.”

Arm chips power many of the world’s smartphones. The British firm was acquired by Nvidia in September, but the $40bn (£29bn) deal is now the subject of a European Commission competition investigation, with regulators concerned that Nvidia could use the move to restrict access to Arm’s technology.

‘Complicated and expensive’
Mr Segars explained that the chip shortage was caused by a range of factors, including unprecedented demand for devices during the pandemic – as everyone rushed to find ways to communicate with their loved ones during lockdowns, and home-school their children.

This was coupled with a sudden surge in demand for cars, and geo-political tensions between Asia and the West, he added.

Commentators have also pointed to the rollout of 5G, the stockpiling of chips because of US sanctions on Huawei and the small number of manufacturing plants, as factors in the crisis.

The Arm boss said the industry was spending $2bn (£1.5bn) a week to add capacity but warned that “just building factories” was not enough.

The “complicated and expensive” process needed better collaboration across the entire supply chain, he said.