Powerline equipment maker Devolo has to reorganize due to overstock

The German Devolo is going to restructure. The maker of powerline devices has been forced to do this, because he has run into financial problems. Due to chip shortages, orders had to be placed far in advance. Devolo now has a surplus.

Due to the persistent shortages of parts, Devolo had to make delivery commitments at an early stage, the manufacturer writes on its website. As a result, the company had a very large inventory at the beginning of 2022 and a liquidity problem arose.

Powerline adapters from Devolo

Sales in 2021 turned out to be disappointing, after the company had come through 2020 relatively well. According to Devolo, last year’s sales were disappointing due to the further closure of the retail sector as a result of the corona measures and “a change in buyer behaviour, especially in the German market”. In addition, Devolo said it was unable to sell large orders to network operators abroad, because specific products were not available due to the lack of chips.

The restructuring procedure that the company has now started is common in Germany for companies on the verge of bankruptcy. Devolo says it will develop a restructuring plan in the coming months in consultation with stakeholders. During that process, Devolo’s business activities continue to run.

Devolo is a German manufacturer of communication equipment. The company is best known for its powerline adapters for a network connection over the electricity grid. Devolo was founded in 2002 and is headquartered in Aachen.