Dicker Data takes revenue hit amid global chip shortages

Dicker Data has revealed its financials have started to be impacted by the global chip shortages, reporting a hit to its revenues.

For the quarter ended March 2021, the distributor reported revenue of $447.7 million, a 3.5 percent decrease from the same period in 2020. Net profit after tax was $19.4 million, up 5.7 percent year over year.

Dicker Data said revenue was impacted by the global computer chip shortage as vendor partners’ ability to supply sufficient stock to meet local market demand was affected.

As a result, gross profit margin increased from 9.7 percent to 10 percent during the period, helping fuel the profit growth.

In an update to the ASX, the company said it expects the global chip shortage to “continue for the foreseeable future” and manufacturers are currently working at a global level to manage the inventory available.

“Larger markets, such as the US and Europe, are experiencing higher allocations than many countries across the APAC region. Each vendor is executing a slightly different strategy, and Dicker Data is extremely well placed to capitalise on the opportunities this unique market dynamic is creating,” the announcement read.

“As an authorised distributor of a diversified range of technology brands for devices, servers, storage and networking solutions, Dicker Data is leveraging its supply chain to meet the current and growing market demand.”

Dicker Data added that it is also experiencing strong demand with a backlog of orders to fulfil and as supply improves, and expects to meet the demand in the coming quarters.

“There continues to be significant opportunities for the technology sector with digital transformation accelerating, businesses becoming digital natives and the evolving hybrid and modern workforce becoming dependent on smarter, faster and collaborative technology solutions,” the announcement read.

Looking ahead, Dicker said it would continue to evolve and differentiate its offerings, including cybersecurity which it expects to continue to be a key focus for all sectors in 2021.

“We experienced an unprecedented spike in demand for devices throughout 2020 and expect this to continue in 2021,” the announcement read.

“We are anticipating a high level of growth in the adoption of automation, machine learning and data capture and analysis tools as businesses and governments prioritise efficiency and productivity within their operations.”