Big Tech made more money than ever despite chip shortage

Updated on Feb 01, 2022 03:04 PM IST

Major technology companies ended the last year on a high – the highlights being Apple recording its best ever quarter and Tesla almost delivering the promised 1 million vehicles for the year

Apple reported that Q1 2022 (this is for the December 2021 quarter) was the biggest quarter for the company in terms of revenue. (File/REUTERS)
Apple reported that Q1 2022 (this is for the December 2021 quarter) was the biggest quarter for the company in terms of revenue. (File/REUTERS)

The depressive sentiment driven by chip shortage and supply chain constraints hasn’t really held back Apple, Microsoft, Samsung, Intel and Tesla from clocking record numbers for the quarter. These companies ended the year on a high – the highlights being Apple recording its best ever quarter and Tesla almost delivering the promised 1 million vehicles for the year.

Apple reported that Q1 2022 (this is for the December 2021 quarter) was the biggest quarter for the company in terms of revenue. That’s $123.9 billion in revenue and $34.6 billion profit. Incidentally, this was the first full quarter for the Apple iPhone 13 series on the shelves, and the iPhone business raked in $71.63 billion, that is up 9 percent over the same quarter in 2020.

The iPad line-up was hit more than others by supply chain issues even as the Macs (up 25% year-over-year or YOY), services (up 24%) and wearables (up 13%) more than made up.

Samsung reported KRW 76.57 trillion (around $63.6 billion) in revenue and KRW 13.87 trillion (around $11.5 billion) profit for the three-month period, a revenue record for the Korean tech giant, in any quarter. In fact, the KRW 279.6 trillion (around $232.4 billion) revenue for the year was also a record.

Samsung’s 24% YOY revenue uptick has come on the back of robust sales for premium smartphones, TVs and appliances. These numbers come ahead of the expected launch of the Samsung Galaxy S22 flagship phone series this month.

Microsoft’s Q2 2022 results indicate Windows, Surface computing devices, Xbox gaming consoles, Office and cloud services have all recorded revenue spikes. Windows revenue from OEMs (the Windows 11 licenses for new PCs) was up 25% – Gartner indicates that 340 million PCs were shipped in 2021, while IDC indicates 348.8 million units were shipped.

Even though Microsoft was tempering expectations for the Surface line-up, the revenue increased 8% over the same quarter the year before. Xbox consoles, worst hit by the chip shortage, still recorded 4% higher revenue.

Intel has reported its highest quarterly and annual revenue, despite being hit significantly by the chip shortage for large parts of 2021. The quarterly revenue is $19.5 billion while Intel ends the year with $74.7 billion in revenue. That said, profits were down – 21% ($4.6 billion) and 5% ($19.9 billion) quarterly and yearly.

Intel has launched the 12th generation Intel Core processors for PCs and announced an investment of more than $20 billion in two new chip factories in the US. The increased demand for Intel’s Internet of Things Group (IOTG) and Mobileye (car tech) businesses should provide a platform once the supply chain strain eases.

Tesla’s Q4 earnings mean that it is the second successive year of the auto company remaining in the black. Tesla ended the quarter with a $2.3 billion profit, which is significantly higher than $270 million from the same quarter in 2020. The annual profit of $5.5 billion (this is up from $721 million in 2020) comes from the $17.7 billion clocked in revenue.

Tesla says they manufactured 305,840 vehicles in the quarter, which is 70% more than the same period the year before. Tesla promised 1 million vehicle deliveries in 2021 – fell just short with 936,172 vehicles delivered to buyers.

Netflix remains the outlier in this. The streaming giant added 8.28 million paid subscribers globally in Q4, but that’s just not fast enough. This number is shy of the 8.5 million subscribers Netflix added in the same period a year before. The outlook isn’t very bright either.

They are forecasting 2.5 million new subscribers in the first three months of 2022, which will be far lesser than the 3.98 million Netflix added as paid subscribers in the first three months of 2021. Competition from Apple TV+, Disney+, Hulu, HBO Max and newer services like Peacock, are hurting.

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  • ABOUT THE AUTHOR

    Vishal Mathur is Technology Editor for Hindustan Times. When not making sense of technology, he often searches for an elusive analog space in a digital world.

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