Top 3 game console vendors show mixed sales despite chip shortages

The world’s three major game console vendors, Sony, Nintendo and Microsoft, posted mixed sales results amid supply shortages of some core chips and components.

Despite a slight improvement in overall component shortages, some peripheral chips such as power management integrated circuits (PMICs) remained in short supply in part due to continued logistical stagnation, industry sources said.

Hit by component supply constraints, Sony saw PS5 unit shipments fall short of expectations in fiscal year 2021 (ending March 31, 2022). The company originally expected sales of the PS5 to equal those of the PS4 in the first year of launch, but only reached 11.5 million units, far behind the 14.8 million for the PS4.

During the January-March 2022 period, PS5 sales reached just two million units, down a steep 39.4% from the previous year and marking the lowest quarterly shipments since the launch of the model in November 2020, the sources noted, adding that IC shortages and logistical disruptions are to blame for the decline.

Sony is working to address the issue of component shortages in fiscal year 2022 and recently projected its PS5 shipment target for the year to 18 million units, down around 20% compared to the initial estimate of 22.6 million, according to the media.

In fact, market demand for the PS5 is still above the sales target, but component shortages and shipping constraints have prompted Sony to set a cautious sales target for the model, the sources said.

Uneven component supply also caused Nintendo’s Switch series annual shipments to plummet for the first time in fiscal 2021. The company’s stats show its worldwide Switch device sales were 23.06 million units during the year, down 20.01% from the previous year.

Nintendo President Shunraro Furukawa estimated that total shipments of the Switch series, including Lite and OLED models, could drop 8.9% year-on-year to 21 million units in the fiscal year. 2022.

While Sony and Nintendo saw lower shipments for their game consoles, Microsoft had strong sales for its Xbox Series X/S, posting the highest monthly record in March 2022 in dollars thanks to Microsoft’s ability to monitor supply and demand, especially the less affected ones. by chip shortages, according to market researcher NPD Group.

Over the past 17 months, a total of nearly 14 million Xbox Series X/S units have been sold worldwide, particularly in North America and Europe, with shipments estimated in Q1 2022. at 1.2 to 1.5 million units, compared to two million for PS5 and four million for the Switch series.

At the moment, Xbox Series X/S and PS5 adopt AMD’s custom 7nm processors made by TSMC, and the Switch series includes Nvidia processors built with 16nm, with relatively stable core chip supply, have indicated the sources.

As the limited supply of certain peripheral chips and packaging substrates for the production of game consoles is expected to gradually ease in the coming months, the three major brand suppliers may be able to record better performance. shipping in the second half unless global market inflation worsens, further discouraging consumers from purchasing home entertainment equipment, the sources added.