Nintendo Comments On Chip Shortage, Says Engineers Are Looking At "Alternative" Components

Nintendo's top bosses have commented on the ongoing global semiconductor shortage, which has caused Nintendo to downwardly revise its production target for the Switch. Nintendo president Shuntaro Furukawa said as part of Nintendo's latest earnings briefing that there has not been a significant improvement in the supply of semiconductors, which is why Nintendo reduced its production targets for the year to 24 million units.

Despite the ongoing uncertainty, however, Furukawa said game sales--which are traditionally understood to be higher margin than hardware--have seen no impact. The executive said Nintendo will continue to promote its new and evergreen games to users as a means to "maintain the momentum of the Nintendo Switch business."

Nintendo director and senior executive officer Ko Shiota added that Nintendo's engineers are "reviewing" the hardware design of the Nintendo Switch and are looking into sourcing "alternative components" in an effort to mitigate the effects of the supply chain situation.

Shigeru Miyamoto commented on the subject as well. He said the Switch's impressive sales numbers so far--it has sold nearly 93 million units--helps mitigate the issues with hardware component supply. "With so many consumers worldwide having already bought a Nintendo Switch, the situation has not had any major effects on software development," he said.

Miyamoto also pointed out that the semiconductor shortage doesn't impact Nintendo's other business areas, including mobile and "visual content," i.e. movies.

Also during the briefing, Furukawa shared some insight into Nintendo's plans for the next console to come after the Switch. Furukawa said the Switch is only at the "mid-point" of its lifecycle, so no one should expect the company's next hardware to be released anytime soon.

"With regards to the next game system, we are considering many different things, but as far as the concept and launch timing are concerned, there is nothing we can share at this time," Furukawa said.

A slide in Nintendo's earnings release confirms that the new console will launch before the year 2100, which is good news because many of us will likely be dead by then.

Thanks to the massive success of the Switch, Nintendo is in a strong cash position right now and recently disclosed how it plans to spend its fortunes going forward.