Extreme Networks, Cisco and Apple warn of supply chain issues

Extreme Networks sees order book soar, posts stellar third-quarter financial results (US$285.5 million, up 13% year-on-year) but worries about delivery times due to semiconductor supply chain issues.

“Price increases have allowed us to offset rising supply chain costs”said Remi Thomas, chief financial officer of Extreme, during a conference call with analysts.

Cisco – which reports an order book of nearly $14 billion last quarter – also warns of supply chain issues. The company points out that these cause the market to rise ‘gray’ and counterfeit computer equipment.

The gray market, that is, products sold without brand authorization by unauthorized resellers, is not a new phenomenon. However, as the Covid-19 pandemic has dramatically lengthened lead times, some customers and distribution partners are venturing outside of authorized channels to get their hands on new products faster.

The Network Solution Provider’s Legal Department advises that products purchased outside of Cisco’s authorized channels will not carry a valid license or warranty. This material also runs the risk of being modified in such a way as to make it more vulnerable to security breaches.

Cisco estimates $1.2 billion a year in losses from side-selling counterfeit or shoddy hardware on the gray market.

Finally, the giant Apple also announces that supply chain problems could have an impact – which it estimated at around $8 billion – after announcing a record second quarter of $97.3 billion, an increase 9% compared to the previous year.

In detail, the Cupertino company announced revenue of $50.57 billion for the iPhone, representing a growth of 5% year-on-year, revenue of $10.44 billion for Mac, iPad revenue of $7.65 billion, down 7% year-on-year, Apple Watch revenue of $8.81 billion, and services revenue of $19.82 billion, versus $19.78 billion expected.

Analysts say the supply chain repercussions of production shutdowns related to Covid-19 in China and the invasion of Ukraine may not be felt until later in the year.

According to Apple CEO Tim Cook, “For the future, there are two constraints: Covid and silicon shortages. For us, these constraints are mainly around the Shanghai corridor… almost all affected factories have now restarted. We are encouraged that the number of Covid cases in Shanghai has decreased over the past few days. »

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