Joyce Lee, Rajesh Kumar Sing

(Reuters] – The industrial conglomerates GE & 3M and the chipmakers Texas Instruments (NASDAQ) and SK Hynix warn that China’s COVID-19 imposed strict restrictions are further disrupting fragile supply chains, thereby reducing revenue.

China’s Omicron-related “zero Covid” policies has caused new lockdowns in cities across the country, forcing many factories to close down and increasing the supply chain chaos. Financial markets are now worried about the impact on the global economy as it is still recovering from the severe pandemic.

With the soaring cost of raw materials and labor, companies are struggling to stay afloat. The Russian invasion of Ukraine as well as other Western sanctions has driven up energy costs.

“Collectively and supply chain issues, Russia-Ukraine War, China COVID Impacts adversely affected revenue for the quarter by around 6 percentage points,” General Electric (NYSE:) Larry Culp, CEO of Culp Communications spoke on Tuesday in an earnings conference.

Culp stated that GE will not fully offset inflation in this year’s fiscal year. He said that the company was examining its costs and “to scale the business for these new realities.” The company also plans to shift towards a more centralised model of managing its business, closer to customers, to raise prices.

Another American industrial giant 3M stated Tuesday that China’s lockdowns and the Ukraine crisis had caused sales slowdowns in April.

The company was already facing high chip prices and shortages. It stated that it will continue raising prices to compensate for inflationary pressures. This echos GE, which said it had already increased prices and used price escalation clauses within its service contracts.

The outlook is uncertain. It is difficult to forecast. It’s difficult to predict.

SK Hynix in South Korea, which is the world’s 2nd-largest memory chipmaker, stated that China’s lockdown caused weaker demand for chips in personal computers and mobile phones. However, it expects a pickup in second-half as new product launches are made by manufacturers before the end of the year.

On Wednesday, Kevin Noh (Chief Marketing Officer, Hynix) stated that “In the smartphone industry, demand growth has slowed especially in China.”

Texas Instruments, the U.S. chipmaker Texas Instruments, on Tuesday reported disruptions at its customers’ factories and foresees a lower quarter than Wall Street estimates.

Dave Pahl from Texas Instruments’ IR, stated that it was becoming clear that we had lower demand.

ESKILLLUXOTTCA, which manufactures eyewear and accessories for Versace and Prada (OTC) in Europe, is one of the European companies. Kering (EPA: ) Also warned that China’s locking downs are affecting sales.