MSI will be increasing its graphics card prices to make up for the worsening state of the supply chain. This was revealed by the company chairman, Joseph Hsu. Although Micro-Star International’s YoY revenue grew by 30-50% in 2020, the company reported weaker-than-expected profits, amid worsening graphics card shortages. MSI’s profits rose by 42% YoY to reach an impressive $276.97 million by the end of 2020, but it was still a notch below the forecast.
The DIY market is still responsible for the majority of MSI’s revenue with the motherboard and graphics card businesses bringing in around 53% of the company’s overall revenue. The OEM business comprising of notebooks, desktops, and monitors comes in second, contributing a bit over 40% to the consolidated yearly revenue for 2020. This year is expected to bring in record profits for most semiconductor companies, and the same goes for MSI.
The motherboard, graphics card, and gaming laptop markets are expected to show strong demand for the entire year even as supply remains relatively poor. MSI is once again expecting double-digit growth for the financial year 2021, with consolidated revenues for Feb already reported to be the highest ever for the month at NT$13.26 billion (63% up YoY).
Hsu blamed the delay in shipments, and the spike in transport costs, and marketing expenses as the primary reasons for the lower-than-forecasted Q4 revenue. Although the transportation and shipment routines are expected to return to normal by the end of the second quarter of the year, the company will be hiking its graphics card prices to maintain its margins.
The other day, at its investor conference, ASUS had something similar to say, although there was no mention of a price hike in graphics card prices. All in all, it looks like the graphics card shortages and the accompanying price hikes will continue for most of the year, with a rebate expected by the holiday season.