Daily Management Review

Increased Demand From Chips, Laptops And Network Goods As Employees Work Form Home


Increased Demand From Chips, Laptops And Network Goods As Employees Work Form Home
There is a surge for laptops and network peripherals as well as components because of more and more employees staying back home and working from home in order to slow down the spread of the coronavirus pandemic. This has inevitably also increased demand for supply china products such as chips.   
Anticipating a drop in consumer demand and economic slump because of the virus pandemic, many companies have refrained from issuing earnings forecasts. However the global shift to work from home culture is indicating an increase in demand for electronics retailers and chipmakers.
Globally, employees of governments and companies have been advised to stay safe indoors and work from home over the past month. Over almost the same time, there was a 20 per cent increase in semiconductor exports as reported from South Korea which is the home country of the largest memory chip maker of the world, Samsung Electronics Co Ltd.
While internal travel have been banned in Italy, which has reported 5,467 deaths because of the virus pandemic, stay at home orders have been issued for one in three Americans, which points to the reasons for increased demand.
More than 300,000 people have so far been infected with Covid-19 disease - cased by the novel coronavirus, while more than 15,000 people have died globally.  
"With more people working and learning from home during the outbreak, there has been rising demand for internet services ... meaning data centers need bigger pipes to carry the traffic," said analyst Park Sung-soon at Cape Investment & Securities.
Cloud computing has boosted sales of server chips, "while an increase in telecommuting in the United States and China has also been a main driver of huge server demand," a South Korean trade ministry official was quoted in the media as saying.
There has been an increase in demand in laptops partly because of companies encouraging teleworking, said Japanese laptop maker Dynabook. On the other hand, its rival NEC Corp said that it has responded to demand with telework-friendly features such as more powerful embedded speakers.
According to the Australian electronics retailer JB Hifi Ltd, in recent weeks, there was a demand "acceleration" from both commercial and retail customers for "essential products they need to respond to and prepare" for the virus like devices that can allow for remote working as well as home appliances.
Analysts said that the highest growth in demand for chip came from China because of the quick response to the measures of the Chinese government to contain the spread of the virus by Chinese companies like Alibaba Group Holding Ltd , Tencent Holdings Ltd and Baidu Inc.
"Cloud companies opened their platforms, allowing new and existing customers to use more resources for free to help maintain operations," said analyst Yih Khai Wong at Canalys.
"This set the precedent for technology companies around the world that offer cloud-based services in their response to helping organizations affected by coronavirus."