Nintendo warns that the chip shortage will affect Switch sales

Nintendo lowered the sales forecast for its Switch handheld game console by 1.5 million units.

The Kyoto-based gaming giant now says it expects to sell 24 million units this financial year, having previously forecast sales of 25.5 million units.

Animal Crossing creator said the new forecast was due to a change in its production plan, due to the effects of the global shortage of semiconductors.

ARM chip designers recently warned that shortages could delay Christmas gifts.

“Our second half shipping forecast has been reduced due to the change in our manufacturing plan due to the effects of the global semiconductor shortage,” Nintendo wrote in a document accompanying its financial results.

“On the other hand, we have revised up the Nintendo Switch software forecast,” he said, predicting it would sell 10 million more games than previously thought, bringing the total to 200 million.

A number of other companies have foreseen supply problems.

Simon Segars, chief executive officer of chip design company Arm, told a conference that the mismatch between supply and demand is “the most extreme” he has ever seen, with the wait for chip supply lasting up to 60. weeks.

“If you haven’t purchased all of your devices yet, you may be disappointed,” he warned delegates at the Web Summit event.

Next-generation gaming consoles like the Xbox Series X and PlayStation 5 have been in short supply since the start of the pandemic.

In September, Microsoft games boss Phil Spencer said the shortage of next-generation consoles was due to many problems, not just a shortage of chips, and that it would continue beyond Christmas.

“I think with regret that it will stay with us for months and months, certainly until the end of this calendar year and into the next calendar year,” he said. the casing.

Analysts say the shortage will continue to impact all types of consumer electronics

Apple chief executive Tim Cook recently told investors that “higher than expected supply limits” in the three months to September cost the company $ 6 billion (£ 4.5 billion) in lost sales.

Ranjit Atwal, a senior research director at Gartner, told the BBC: ‘The component shortage issues are industry-wide and no supplier is immune from the impact – some may get preferential treatment, but all will suffer.

“For consumers ‘first come, first served’ will be the motto of Christmas”.

Glenn O’Donnell, a technology analyst at Forrester, said the problem is unlikely to be solved anytime soon.

“Semiconductor chips have become the staple ingredient in a wide variety of products – home appliances, consumer electronics and toys are all interested,” he said.

“Apple is also struggling to obtain these essential parts. A large supply of chips will not arrive until well into 2023, perpetuating the electronics supply chain for another two years or so.”