KUCHING: The Coronavirus Disease 2019 (Covid-19) is affecting China and is fast spreading across Asia, Europe, and US.

In addition to the human cost of life, the impact of the spread of the virus on the global economy is only beginning to be appreciated and has deep implications for the world’s technology supply chain.

A new International Data Corporation (IDC) report, ‘Impact of Covid-19 on the Worldwide Semiconductor Market Forecast’, provides IDC’s view on the impact the Covid-19 virus will have on the semiconductor market.

The report provides a framework to evaluate the market impact through four scenarios that assess the range of possible outcomes.

Each scenario is based on varying assumptions and severity of the impact to business for technology suppliers.

For each scenario, a range of critical factors are assessed with a resulting updated forecast, presented with leading indicators to help clients navigate this emergency.

“The emergence of Covid-19 has brought with it travel bans and quarantines; massive slowing of the supply chain; uncertainty in the stock market; falling business confidence, and growing panic among the population,” said IDC Semiconductors and Enabling Technologies programme vice president Mario Morales.

“Despite the growing uncertainty and panic, technology suppliers must continue to focus on their long-term investments, maintain engagement with partners and prospects, and look to specific markets for stability.

“Emerging technologies like 5G, the Internet of Things, high-performance computing, and intelligent edge will be fundamental to an overall recovery by the technology sector.”

At this time, IDC believed the most likely outcome for this event would be a year-over-year (y-o-y) revenue growth rate of minus six per cent for the worldwide semiconductor market in 2020.

“We give this scenario a 54 per cent probability. Under this scenario, the supply chain will start to recover, and quarantines and travel bans will ease, over the summer.

“For the worldwide semiconductor market, the impact will be US$25.8 billion. While the impact of the virus will be felt through the bulk of the year, the accumulated knowledge about the virus, public health initiatives, and other efforts will to some degree mitigate harm done by Covid-19.

“In the short term there will be lower demand for systems and some impact to component availability, but as recovery sets in, growth will return to the market,” it said.



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