Sony and Nintendo are facing mounting pressure from soaring memory chip prices as the rapid expansion of AI data centres tightens global semiconductor supply.
According to industry estimates, memory chip prices doubled in the first quarter compared to the previous quarter and are expected to rise by as much as 63% in the current quarter. The surge in demand from AI infrastructure has disrupted chip availability across smartphones, laptops, automobiles and gaming devices.
Nintendo said higher component costs, especially memory chips, along with tariffs, could add nearly 100 billion yen in expenses during the current financial year. The company confirmed that these rising costs influenced its decision to increase prices for the Switch 2 gaming console.
Nintendo President Shuntaro Furukawa said the Japanese version of the Switch 2 will now cost 59,980 yen after a 10,000 yen increase, while the US version will be priced $50 higher at $499.99.
Sony had earlier announced a price increase for the PlayStation 5 in the US, with the standard version rising by $100 to $649.99. The company said it has secured enough memory supply for the current financial year, but expects prices to remain high next year as well.
Industry experts believe Nintendo could face greater challenges because of its price-sensitive user base and the early stage of the Switch 2 lifecycle. Analysts also noted that the company may now depend heavily on blockbuster game launches to maintain strong demand.
Nintendo expects to sell 16.5 million Switch 2 units this year, compared to 19.9 million units last year, along with 60 million software units.
Sony, meanwhile, said profits in its gaming business are expected to improve despite lower sales. The company also expects strong momentum from the upcoming launch of “Grand Theft Auto VI” in November.
The ongoing AI boom is increasingly reshaping global supply chains, with gaming companies now directly feeling the impact of rising semiconductor demand.
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