Nvidia warned of a possible shortage of gaming solutions in the fourth quarter

Not the most widely publicized news following Nvidia’s quarterly report was the statement by the company’s CFO about a likely shortage of gaming solutions in the fourth quarter. The third quarter in this segment turned out to be so successful that it emptied warehouse stocks, and the company simply did not have time to replenish them.

Image source: NVIDIA

Let us remind you that Nvidia’s gaming revenue in the third quarter grew year-on-year by 15% to $3.3 billion, its dynamics significantly exceeding analysts’ expectations. Consistently, it strengthened by 14%, the period was successful for both gaming laptops and desktop video cards, even gaming consoles, which in this context are called Nintendo Switch, were no exception. Revenue from all of these Nvidia components grew in the third quarter, both sequentially and year over year.

Inventory of Nvidia gaming solutions at retail in the third quarter was depleted faster than management expected; in the fourth quarter, against this background, a decrease in gaming revenue is expected due to restrictions on the supply of new products. As CFO Colette Kress explained, the company is now “actively working to increase supply of all products offered.” Supplies of gaming solutions are being increased as quickly as possible, but stocks have also been depleted unexpectedly, so shortages are very likely. As a representative of Nvidia management added, there is no particular cause for concern, and supplies of gaming solutions will increase to an adequate level at the very beginning of the next calendar year, and therefore the period of shortage will be limited to the fourth quarter. Colette Kress did not explain whether the shortage is related to preparations for the announcement of new gaming video cards for the January premiere, or a focus on the server segment.