Sure, the digitization of the economy was happening anyway entering 2020, but the COVID-19 pandemic has greatly accelerated it. Coming out of the pandemic, consumers and enterprises will now expect more automated, AI-driven, and faster applications. That’s causing a big rise in the use of semiconductors, both on the leading edge, for things like 5G and AI, and on the trailing edge, for applications like automotive and industrial sensors.
Yet after two years of trade war and COVID supply cutbacks, the semiconductor industry is in severe shortage. Auto semiconductor shortages have reportedly led to $61 billion in lost sales to automotive companies, according to Bloomberg. Meanwhile, the CEO of diverse chipmaker Microchip (NASDAQ: MCHP) said on the company’s recent conference call that shortages are broad-based, and could last through 2021 and into 2022.
If that’s true, the following three under-the-radar semiconductor equipment companies could benefit handsomely, making them well worth our time and attention.