This Christmas, finding consoles may be tough. A few weeks ago, the chief financial officer of Xbox expressed doubt that supply chain concerns would be fixed in time for Christmas. It’s no secret that the entertainment business was experiencing supply and demand challenges. While the PlayStation 5, Xbox Console X/S, and Nintendo Switch have all sold well in the last two years, they haven’t always been simple to get.
Sony has vowed to ramp up PlayStation 5 manufacturing for the rest of the year so that more people may have one. However, Microsoft President Tim Stuart anticipates that supply chain concerns may remain until the Christmas season. He anticipates the supply chain climate to continue difficult through 2022 and the Christmas season, and that it has been impacted by recent lockdowns in China due to the coronavirus.
The pandemic was the principal cause of supply difficulties. Parts for computers and the tiniest of all equipment were not being made as a result of the worldwide 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 primary difficulties he had: limited components and increased logistical price margins. That possibility of a shortage being rectified by the end of the year wasn’t good, to begin with. Pat Gelsinger predicted that supply chain problems will last until 2023 in December 2021.
Gelsinger told CNBC in April that there would still be a shortage in 2024. Sony and Microsoft are working hard to remedy this issue. It is said that the firms who make the chips for their consoles have paid more to the manufacturers that pay them for it, and so they will be given precedence. Sony has also collaborated with the Japanese government to build a new facility in order to produce additional chips. Because the plant is not anticipated to open until 2024, the issue has become obsolete.
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Stuart’s comments came from a recent investor call given by financial services firm Baird (via GamesIndustry.biz), where he identified two major issues: scarce components and ‘elevated logistical costs eroding profits.’ To begin with, the chances of shortages being addressed by the end of this year were not promising. Intel CEO Pat Gelsinger warned in December 2021 that supply chain concerns might extend until 2023.