This Christmas, finding consoles can be tricky. A few weeks ago, Xbox’s chief financial officer expressed doubts that supply chain issues would be resolved in time for Christmas. It’s no secret that the entertainment industry was experiencing supply and demand issues. While the PlayStation 5, Xbox X/S console, and Nintendo Switch have all sold well over the past two years, they haven’t always been easy to get.
Sony has pledged to ramp up manufacturing of the PlayStation 5 for the rest of the year so more people can have one. However, Microsoft President Tim Stuart predicts supply chain issues could linger well into the Christmas season. He predicts that the supply chain climate will remain challenging through 2022 and into the Christmas season, and has been affected by recent lockdowns in China due to the coronavirus.
The pandemic was the main cause of supply difficulties. Computer parts and the smallest of all equipment were not being manufactured following the global shutdown. This is why the PlayStation 5 and Xbox Console Series X/S were very hard to get when they were released in late 2020.
Stuart made the comment during a recent investor call conducted by financial services firm Baird (via GamesIndustry.biz), where he noted the two main pain points he was having: limited components and logistical price margins. increased. This possibility of a shortage being corrected by the end of the year was not good, to begin with. Pat Gelsinger predicted that supply chain issues will last until 2023 in December 2021.
Gelsinger told CNBC in April there would still be a shortage in 2024. Sony and Microsoft are working hard to remedy this problem. The companies that make the chips for their consoles are said to have paid more to the manufacturers that pay them, and so they will get priority. Sony has also worked with the Japanese government to build a new facility to produce additional chips. As the plant is not expected to open until 2024, the issue has become obsolete.
— Game Rant (@GameRant) June 16, 2022
Stuart’s comments come from a recent investor call by financial services firm Baird (via GamesIndustry.biz), where he identified two major issues: scarce components and “high logistics costs that erode profits.” For starters, the odds of the shortages being resolved by the end of the year weren’t promising. Intel CEO Pat Gelsinger warned in December 2021 that supply chain issues could stretch into 2023.