Highlights
- NVIDIA’s gaming supply constraints may persist for several quarters and extend into 2026.
- Rising AI demand and data center revenue growth are limiting chips for gaming hardware.
- TrendForce projects a 4.4% console market decline amid ongoing supply constraints.
NVIDIA expects the global shortage of gaming chips to persist until the end of 2026. The extended supply constraints are already putting pressure on the video game industry. The company shared the outlook during its quarterly earnings call, stating supply limits will continue to affect gaming in the near term.
Chief Financial Officer (CFO), Colette Kress, noted constraints are likely to remain in place for several quarters despite strong demand.
“As much as we would love to have more supply, we do believe for a couple quarters it is going to be very tight,” she said. She added that any improvement later in the year could influence year-over-year growth, though it is still too early to assess.
AI Demand Drives Gaming Chip Shortage
The shortage is linked to rising demand for memory chips used in artificial intelligence (AI) systems. As companies expand AI infrastructure, manufacturers are prioritizing higher-margin data center components over consumer hardware. That has reduced the supply for smartphones, PCs, and gaming consoles.
NVIDIA chips are used in PC gaming systems and the Nintendo Switch, while Sony’s PlayStation and Microsoft’s Xbox rely on hardware from AMD.
Industry projections reflect the strain. TrendForce in December 2025 forecast a 4.4% decline in the console market this year, compared to an earlier estimate of a 3.5% drop.
However, the revenue gap highlights the shift. NVIDIA reported $62 billion USD in quarterly data center revenue versus $3.7B from gaming. Networking added $11B, and sovereign AI infrastructure more than tripled to over $30B for the fiscal year.
As AI investment accelerates, more advanced chips are being directed toward large-scale “AI factories,” reinforcing tight supply for gaming hardware.
