Nvidia expects gaming chips shortage to last until year-end

A global shortage of gaming chips could last until ​the end of this ​year, an Nvidia executive has said, signaling ​more pain for the video game industry that is already buckling under weak sales due to slowing consumer demand.

Nvidia expects the supply constraints to ‌hurt its ⁠gaming ⁠business in the current quarter and beyond even as the chip giant ​sees strong demand, Nvidia finance chief Colette Kress said on the company's ​quarterly earnings call on Wednesday.

"As much as we would love to have more supply, we do believe for a couple ​quarters it is going to be ⁠very tight," ‌Kress said.


"If things improve by the end of ​the ​year, there is an opportunity to think about ⁠what that is from a year-over-year growth. But ​it's still too early for us to know ​at this time."

With the tech industry racing to build out artificial intelligence capacity, demand for memory chips has outstripped supply, causing a spike in prices and prompting manufacturers to prioritize components for higher-margin data center chips.

That has constrained ‌supply for consumer electronics such as smartphones and personal computers, as well as gaming consoles. Nvidia chips ​are widely ​used in PC ⁠gaming as well as in the Nintendo Switch console, while Sony's PlayStation and Microsoft's Xbox consoles use AMD hardware.

Forecasts for the ​console market have been bleak. According to projections from tech industry research firm TrendForce in December, the console market is expected to see a 4.4% decline this year, compared with its earlier forecast of a 3.5% drop.