Bank of America warns: smartphone inventory pressure will intensify

CTOnews.com, November 28, according to Taiwan's Economic Daily, the latest report from BofA Securities warns that the pressure on smartphone inventory is increasing. Inventory days are expected to peak from the first quarter to the second quarter of next year, reaching 3.2 months, and may continue into the third quarter, maintaining the level of 3.1 months.

This also means that the relevant supply chain will still be difficult to get rid of the operating pressure in the first half of next year. In addition, the iPhone supply chain faces limited impact because inventory levels are lower than those in the non-Apple camp.

Taiwan media pointed out that although the market generally believed that the smartphone industry had passed the worst after a three-year downward cycle, BofA remained conservative about the industry's outlook.

CTOnews.com learned that BofA analysts said the reason the inventory took longer than the market expected was due to the active expansion of smartphone production between 2020 and the first quarter of 2022.

Among them, shipments increased by 15% in 2021 compared with the same period last year. Inventory days in the technology supply chain showed signs of declining month-on-month in the third quarter of this year, but still higher than in the same period from 2019 to 2021 and above the median of the past five years. BofA believes brands and the supply chain will continue to adopt a conservative operating strategy.