The ongoing shortage of Xbox and PlayStation consoles has been a story since these platforms launched in November. The shortage isn’t unique to console gaming — there are problems with hardware availability across both PCs and consoles as recently launched GPUs from Nvidia and AMD remain difficult to find, as do AMD’s Ryzen 5000 CPUs.
According to Xbox head Phil Spencer, the company has been fielding questions related to Xbox production for weeks.
“I get some people [asking], ‘why didn’t you build more? Why didn’t you start earlier? Why didn’t you ship them earlier?’ All of those things,” Spencer said on a Major Nelson podcast, as spotted by VGC.
“It’s really just down to physics and engineering. We’re not holding them back: we’re building them as fast as we can. We have all the assembly lines going. I was on the phone last week with Lisa Su at AMD [asking], ‘how do we get more?’ So it’s something that we’re constantly working on.”
I don’t want to say that there’s nothing AMD can do to improve the situation for Microsoft, but the company’s ability to change the situation are probably limited. AMD’s involvement with the chip is limited to designing it — the actual job of manufacturing and shipping it in sufficient volume is done by TSMC.
There may indeed be some knobs and dials that AMD has some indirect control over, or it might be able to work with TSMC to enhance yields if a certain number of Xbox Series X|S SoCs are just barely missing spec. Small tweaks to improve yield and performance are common. From the mid-aughts to the mid-2010s, it wasn’t unusual to see AMD or Intel introduce a newer variant of an older chip, but with a lower TDP compared with what they’d shipped right out the door. These improvements reflected low-end optimizations.
But, while AMD might be able to boost Xbox production by reducing orders in other 7nm product families, the company will be limited by how much 7nm capacity TSMC has. Last fall, multiple reports suggested TSMC would be able to build 140,000 7nm wafers a month by the end of 2020. In the first half of 2020, TSMC’s WPM (wafers per month) was estimated at 110K. This implies the company increased its 7nm capacity by 1.27x throughout the year.
Clearly, it hasn’t been enough, and Nvidia’s decision to build with Samsung on 8N instead of tapping TSMC’s 7nm hasn’t been enough to save Ampere’s availability, either. Nvidia is currently expected to move to TSMC 7nm for additional Ampere production in 2021, which may put even more pressure on the situation.
Relief might come in the form of drawdowns on 7nm mobile demand as companies transition to 5nm. Currently, a number of companies have told consumers to expect better product availability after the March – April 2021 timeframe, which could reflect anything from new capacity coming online, to improved yields, to decreased 7nm utilization as companies transition to 5nm. It could even be that companies are forecasting decreased shutdown levels by that point, which might lead to a slackening of demand, especially in the short term. Once people can leave the house safely again, we’ll probably see spending flow out of video games and home entertainment and back towards other types of leisure, even if the pandemic creates a long-term uptick in the number of people buying consoles, subscribing to streaming services, or working from home.
The best data we have on the two console manufacturers’ relative performance comes from VGChartz. They’ve compiled their estimates for sales over the first six weeks since launch (the Switch data is aligned to its launch, not present-day sales). The results are not particularly great for Microsoft, though we’d caution that only a very limited amount of data can be drawn from the first six weeks, especially at a time when console sales continue to be supply limited. All indications suggest that Microsoft and Sony continue to sell every console they can make.
US sales are a better story for Microsoft. While the Xbox Series S|X are still lower than PlayStation 5, they’re off by roughly 30 percent, not nearly 50 percent. This is also the one region where Xbox is actually beating Switch in terms of worldwide sales. Everywhere else, Switch leads, including Japan.
For now, evidence indicates the PlayStation 5 is strongly outselling the Xbox Series (both flavors) globally, with a tighter (but still Sony-favoring) competition in the US. Whether AMD can do anything to put more console SoCs in the hands of its partners is unknown. Also, wasn’t it the PlayStation 5 that was supposed to be facing the severe supply constraints?
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