Supply Chain Outlook: Persistent Constraints Replace Broad Shortages

NewPower Worldwide’s Chief Trading Officer, Matthew Fonstein, was recently featured in Electronics Sourcing, where he shared his perspective on how the electronic supply chain is expected to evolve over the next 12 months and what that means for purchasing departments.

The next 12 months will be extremely challenging for purchasing departments. The global semiconductor supply chain remains in a state of constraint, particularly across memory and ICs, where demand shows no sign of slowing. The AI boom is a major driver, but it is not the only one. Capacity limitations, allocation pressure and uneven recovery across suppliers continue to distort availability and pricing.

As the market evolves, it is becoming less about broad shortages and more about persistent, category-specific constraints. Purchasing teams are facing pricing increases of 25 to 100 percent or more quarter-over-quarter, while simultaneously being told that only 40 to 50 percent of forecasted demand will be met. This is impacting virtually every industry, and the situation continues to worsen, not improve.

Some major OEMs delayed purchasing memory last year, anticipating pricing to ease. That assumption proved wrong. Those organizations are now being forced back into the market at significantly higher price levels, often competing for limited allocation while urgently seeking alternative lines of supply to support their production targets.

For purchasing departments, the threat is clear. Static forecasting, delayed decision-making and reliance on traditional channels create real risk, including missed builds, delayed launches and margin erosion. The opportunity, however, lies in adaptability. Buyers who move quickly, stay close to the market and utilize alternative sources of supply will be better positioned to navigate volatility and see results.

Over the next year, procurement will become more tactical, more risk-focused and more influential. Access, speed and continuity will matter as much as price, and purchasing teams that adjust to this reality will play a critical role in protecting revenue and production.

At NewPower Worldwide, we see this shift accelerating. To say the next 12 months will be challenging is an understatement.

What emerges from this perspective is a market that has recovered but in a fragmented fashion. A period of universal shortages has given way to a more complex market where constraints are specific, pricing is volatile, and availability is uneven across technologies. For purchasers, this shift introduces a new layer of difficulty with visibility harder to achieve and traditional forecasting models are increasingly unreliable. Access to alternative channels becomes a critical differentiator. It is within the supply, demand, and timing gaps that independents play a pivotal role.

About NewPower Worldwide

NewPower Worldwide is a privately held distributor of electronic components, headquartered in Nashua, New Hampshire. The company operates globally and reported $3.1 billion in revenue in 2025.