Games

Console shortage “gets worse before it gets better”-report

Due to the current global shortage of semiconductors, game console inventories may continue until Christmas.

This is a new Bloomberg report quoting anonymous sources in the supply chain, and semiconductor “small” buyers such as video game companies are now becoming tech giants in the race to secure parts. Claims to be losing.

“The gaming hardware industry is preparing for supply deterioration before it improves in 2021 and could impact the next holiday season,” quotes people familiar with the issue. Is stated.

Game console makers have been suffering from inventory shortages for a year after a pandemic has closed important supply chains and countries have implemented social distance measures that have led to a significant increase in demand for game consoles.

In particular, the recently released Sony and Microsoft next-generation consoles, as well as Nvidia’s new RTX graphics cards, were extremely difficult to secure, as most restocks sold out within minutes.

Sony executives confirmed last week that a global semiconductor shortage could impact PlayStation 5 shipments in the next fiscal year. AMD, which manufactures chips in PS5 and Xbox Series X / S consoles, recently forecasts supply problems by the first half of 2021. Nvidia states that the supply of RTX GPUs is likely to remain “lean” until at least April.

According to a Bloomberg report, game console supply issues include several Asian companies responsible for the global supply of advanced semiconductors that are struggling to meet the growing demand caused by pandemics. It arises from a factor.

Although TSMC and Samsung Electronics Co. have stated that they are increasingly the only means of producing parts, their capabilities take years to plan and billions of dollars to build in collaboration with customers.

It is also said that excess stockpiling by major companies is affecting supply. Bloomberg claims that smartphone giants Huawei and Apple have begun hoarding components last year in response to strict US sanctions.

TSMC executives confirmed in a recent earnings announcement that customers were accumulating more inventory than usual to hedge uncertainty.

This all happened because the stay-at-home order increased sales of electronics that required smart, customized chips.

At Sony’s quarterly financial results briefing last week, CFO Hiroki Totoki said that PS5 shipments in 2021 (April 2021 to March 2022) were 14.8 million PS4s shipped at the same stage of the console life cycle. He said he wanted to go beyond the table, but he wouldn’t hit the target due to lack of parts.

“I think there will be strong demand for the PS5 next year,” Totoki said through an interpreter. “We are trying to procure 14.8 million components at the level of the second year of PS4 launch compared to the original plan. For PS5, we want to exceed that level of PS4.

“But the level of demand from customers [is] It’s very expensive on PS5. Therefore, we strive to procure more quantities of various equipment.

“But we need to look at the global shortage of semiconductors. As we try to increase our capabilities, we face difficulties due to this global situation, but with regard to shipping. Is doing its best to go beyond the original plan. “

Nintendo President Shuntaro Furukawa told investors last week that despite the industry’s overall shortage, there is still a sufficient supply of parts.

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Source: https://www.videogameschronicle.com/news/console-shortages-will-get-worse-before-they-get-better-due-to-ongoing-parts-shortages-report-claims/

https://www.thetechgame.com/News/sid=28063/console-shortages-will-get-worse-before-they-get-better-report.html

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