Technology companies are increasingly discussing about China in 2022 (as on 09 October) with mentions increasing by 38% year-on-year (YoY). However, the sentiment declined by 8% over 2021, reveals the Company Filing Analytics platform of GlobalData, a leading data analytics company.

Ekta Chourasia, Business Fundamentals Analyst at GlobalData, comments: “COVID-19 induced lockdowns, especially in China in the first half of 2022, had caused component shortages, supply chain problems, delayed shipping times and logistic challenges. While many companies reported decline in their sales volume, some other reported increased labor costs. In addition, the persistent power shortage in China also impacted the companies’ operations.”

Electronic company Daktronics discussed part shortages and a challenging labor environment due to prolonged lockdowns. TransAct Technologies mentioned delayed product shipments from its contract manufacturers located in China due to supply chain disruptions. Nocopi Technologies mentioned higher shipping costs due to COVID-19 at major ports in China. Stronghold Digital Mining, Corning and TTM Technologies discussed power shortage in China impacting their operations and revenues.

While Duolingo mentioned significant expenses to operate its businesses in China due to regulatory uncertainty and geopolitical tensions, Apple and Broadcom reported decline in their net sales in China. nLIGHT, a semiconductor manufacturer, indicated lower sales from microfabrication customers in China impacting its revenue.

Companies such as Ajia Innogroup Holdings highlighted loss in investments in China due to the imposition of restrictions on capital repatriation and foreign investments. ADTRAN Holdings and Alpha and Omega Semiconductor mentioned negative impact on their gross profits, gross margins, and business operations due to changes in trade policy, including the imposition of additional tariff, particularly by China.

Chourasia concludes: “In response to the additional tariff imposition, trade restrictions, increased taxation, and other issues like power shortage and geopolitical tensions, several technology companies like KULR Technology, Key Tronic and Sonos are looking to shift their production base away from China to countries like Vietnam and other Asian and European countries.”