Strong demand and allocation continue to drive European semiconductor distribution in 1Q22
DMASS reports Q1 growth of 43.5% in semiconductors and 35.7% in interconnect, passive and electromechanical components. Shortages continue, but order situation becomes lighter. Impact from the War is limited but poses a risk for near-term future.
On the back of a strong 2021, a huge order book and ongoing shortages in key components, European components distribution again reported significant growth in its first calendar year quarter. According to DMASS Ltd., semiconductor sales, as reported by members, grew by 43.5% to a new record EUR 3.13 billion. IP&E (Interconnect, Passive and Electromechanical) components grew by an equally impressive 35.7% to EUR 1.62 billion. In total, the market grew by 40.8% to EUR 4.75 billion.
“A combined growth of 40% across all components is outstanding, but at the same time a clear sign of unprecedented times. The challenges of a post-CoVID recovery are now accompanied by the uncertainties of the Russian war against Ukraine and its ramifications for the entire planet. The human catastrophe of this war dwarfs every other concern, may it be unclear market expectations or supply chain disruptions. We hope that a just peace will be achieved soon,” says Hermann Reiter, chairman of DMASS in a press release.
From a regional view, DMASS reported a similar picture on semiconductor growth as in the last quarter, a huge spread and an astounding strength of the major countries. Germany, for example, grew by 45.4% to 867 Million Euro, Italy by 45.6% to EUR 310 million, the UK by 47.8% to EUR 213 million, France by a staggering 54.8% to EUR 210 million, Eastern Europe instead “only” by 34.5% to EUR 540 million and the Nordic countries by 46% to EUR 240 million.
At product and product group level, the situation was a bit more diverse. While Memories and Other Logic (ASSPs etc.) grew significantly over-proportionally and MOS Micro slightly faster than average, most other product groups grew below average, although still in the 20s and 30s. Analog, for example, grew by 42% to 886 Million Euro, MOS Micro by 44.8% to EUR 621 million, Power by 36.5% to EUR 375 million, Memories by 71.8% to EUR 328 million, Opto by 26.1% to EUR 260 million, Other Logic by 64.7% to EUR 172 million, overtaking Programmable Logic (33.5% to EUR 165 million). Finally Discretes went up 41.9% to EUR 188 million and Sensors (incl. Actuators) by 34.9% to EUR 88 million.
Interconnect, Passive and Electromechanical Components
Interconnect, Passive and Electromechanical (IP&E) components again showed parallels to semis, but total sales “only” grew in the 30s. Last quarter’s EUR 1.62 billion of total sales split as follows: Germany grew by 39.5% to EUR 418 million, Italy by 40.5% to EUR 191 million, the UK by 31.4% to EUR 147 million, France by 31.9% to EUR 143 million and Eastern Europe by 30.5% to EUR 207 million. On the product side, Passives grew by 36.4% to EUR 670 million, Electromechanical products (including connectors) by 34.6% to EUR 852 million and Power Supplies by 40.4% to EUR 93 million.
“We can certainly be very satisfied with the financial results in the first quarter, although some of the growth is exchange rate as well as price-driven. However, we are definitely not happy with the continuing difficult supply situation, where we cannot serve customers in the way we want. While we all hope that the situation gets better towards the end of the summer, the current uncertainties make any prediction impossible. The terrible war continues, economic growth expectations have been cut across the board, supply chains are disrupted by lockdowns in Asia, inflation is rising, energy supply is becoming unaffordable and customer confidence is sinking. We can only hope that this is all 2022 has in store for us. In the long run, we are convinced that technology will still make a huge difference to the world and distribution will be the way to go,” says Chairman Hermann Reiter.