Key Takeaways
- Macronix, a major memory supplier for Nintendo Switch and Switch 2 game cards, is gradually exiting ROM production.
- ROM products accounted for just 5% of Macronix’s revenue in Q3 2026, down from 26% during the same period last year.
- The company is redirecting manufacturing resources towards NOR and NAND memory products, which are benefiting from stronger demand, including from AI data centres.
- Macronix isn’t Nintendo’s only supplier. ROHM-made memory chips have also been identified in Nintendo Switch 2 game cards.
- The supply change could put additional pressure on physical cartridge costs and encourage publishers to use more Game-Key Cards.
- Nintendo has recently confirmed that it has no plans to abandon physical games, so this development does not mean cartridges are disappearing immediately.
Nintendo Switch and Switch 2 Cartridges Face New Supply Concerns as Macronix Exits ROM Business
Physical Nintendo games might be heading towards another supply-chain headache, and this time it involves one of the companies responsible for manufacturing the memory chips inside Switch and Switch 2 game cards.
Macronix, a longtime Nintendo hardware partner and major ROM memory manufacturer, has announced that it is gradually phasing out its ROM production business. The development comes as memory manufacturers increasingly shift their attention towards products used in AI data centres and other rapidly growing technology markets.
The news was highlighted by industry analyst David Gibson on November 4, following Macronix’s latest quarterly earnings announcement.
At first glance, this might sound like another boring semiconductor industry story, but it could have a pretty noticeable impact on Nintendo’s physical game business. ROM chips are an important part of traditional game cards, including those used by the original Switch and Nintendo Switch 2.
With one of its major suppliers gradually leaving this particular business, Nintendo and other publishers could face additional pressure when sourcing the components needed for physical releases.
And this is happening at a particularly interesting time. Nintendo has repeatedly shown its support for physical games, even as other gaming companies move towards digital distribution. Now, the company may have another challenge to deal with if cartridge production becomes more expensive or difficult to manage.
Macronix ROM Business Now Accounts for Just 5% of Its Revenue
The biggest reason behind this development becomes clearer when looking at Macronix’s latest financial results.
According to its Q3 2026 earnings figures, ROM products accounted for approximately 5% of the company’s total revenue. That’s a massive decline compared to the same quarter last year, when ROM products represented around 26% of its business.
The situation becomes even more interesting when looking at the actual revenue figures. Macronix’s ROM revenue dropped by approximately 39% year over year during Q3 2026.
Meanwhile, other parts of its memory business are performing considerably better. The company’s NOR memory revenue reportedly increased by 158% year over year, while NAND revenue surged by 768%.
So, from a business perspective, Macronix has a pretty obvious reason to reconsider where it puts its manufacturing capacity.
During its October 27 earnings conference, chairman and CEO Miin Wu discussed the company’s changing manufacturing priorities. Demand for NOR memory used in data centres is particularly strong, with customers asking the company to provide more production capacity.
Macronix is therefore moving towards higher-growth memory segments while gradually reducing its involvement in ROM manufacturing.
David Gibson also highlighted that Macronix doesn’t plan to introduce new ROM products, with Q3 being the final quarter in which the company separately reports ROM sales, according to his November 4 update.
It’s worth distinguishing the reporting change from the manufacturing exit itself. Macronix has described the move as a gradual phase-out, rather than announcing that every existing ROM production line will suddenly shut down immediately.
You can read more about the company’s financial results in Taipei Times’ report on Macronix’s Q3 earnings.
Why Is Macronix Moving Away From ROM Production?
The answer is largely connected to changing demand across the semiconductor industry.
Over the past few years, artificial intelligence has become one of the biggest drivers of demand for advanced memory and storage products. Data centres require substantial amounts of memory to handle increasingly demanding workloads, and manufacturers are looking to take advantage of that growing market.
Macronix is seeing particularly strong demand for NOR flash memory used in data-centre applications. Its chairman has indicated that customers are actively seeking additional supply, creating an opportunity for the company to redirect its available manufacturing resources.
It’s also expanding its focus on NAND memory products, including eMMC storage used in various electronic devices.
This isn’t an entirely new situation for the industry, either.
Back in December 2025, Micron announced that it would exit its Crucial consumer business, ending sales of consumer-branded RAM and SSD products through retailers and distributors. The company explicitly connected its decision to the growing demand for memory and storage from AI data centres.
Macronix’s decision is not identical to Micron’s, since the two companies are dealing with different product categories. However, both developments highlight how manufacturers are reconsidering their priorities as demand shifts towards higher-growth business segments.
For companies like Nintendo, which depend on specialized memory components for physical game cards, these changes can create an uncomfortable situation.
Gaming products are competing for manufacturing capacity in an industry where other markets may offer stronger demand and better commercial opportunities.
Does Macronix’s Decision Mean Nintendo Will Stop Making Physical Cartridges?
Thankfully, no. At least, there’s currently no reason to assume Nintendo is about to abandon physical game cards.
Macronix is a major supplier, but it isn’t the only company involved in manufacturing the memory chips used in Nintendo’s game cards.
ROHM is another important name worth mentioning. Chips manufactured by the Japanese semiconductor company have reportedly been identified in Nintendo Switch 2 game cards, indicating that Nintendo has access to alternative suppliers.
That’s an important distinction because Macronix leaving the ROM business doesn’t automatically mean Nintendo will run out of components for future physical releases.
There could still be existing inventory, alternative suppliers, and opportunities for Nintendo to adjust its sourcing arrangements. However, the exact production capacity of those alternatives and how much they can replace Macronix’s output isn’t publicly clear.
In other words, the immediate concern isn’t that physical games will suddenly disappear from store shelves. It’s that Nintendo could have fewer options when sourcing the specialized components required for traditional game cards.
Depending on how the supply situation develops, that could eventually affect manufacturing costs, availability, or the decisions publishers make when selecting physical release formats.
Nintendo Could Face Higher Cartridge Production Costs
Here’s where things get particularly interesting for Nintendo Switch and Switch 2 owners.
When a major supplier exits a specialized manufacturing segment, other manufacturers may need to handle a greater share of the remaining demand. If available production capacity cannot keep up, sourcing those components could become more expensive.
That’s a potential problem for Nintendo because physical game cards aren’t simply ordinary storage devices that publishers can replace with any inexpensive memory chip.
They are specialized products designed to work with Nintendo’s hardware, and their manufacturing costs are an important part of producing boxed game releases.
If publishers have to spend more money securing the necessary components, they may eventually need to reconsider how they distribute their games.
There are a few possible outcomes:
- Higher physical game costs: Publishers could face increased manufacturing expenses, potentially passing some of those costs on to consumers.
- More Game-Key Cards: Nintendo Switch 2 publishers could increasingly choose physical cards that contain a download key instead of the complete game.
- More digital-only releases: Some publishers could decide that distributing games digitally makes more financial sense than manufacturing physical copies.
- Alternative suppliers: Nintendo and its manufacturing partners could increase their reliance on other memory chip manufacturers to maintain traditional cartridge production.
None of these outcomes has been announced as an immediate response to Macronix’s decision. They’re possible consequences of a tighter supply chain, not confirmed changes to Nintendo’s release strategy.
Game-Key Cards Could Become More Common on Nintendo Switch 2
One option that could become increasingly attractive to publishers is the Game-Key Card format.
For anyone who hasn’t followed the debate surrounding Switch 2 physical releases, Game-Key Cards are different from traditional Nintendo game cards.
A standard physical game card contains the actual game data, allowing players to insert it into their console and start playing without downloading the entire game.
A Game-Key Card, on the other hand, doesn’t contain the complete game. It stores a key that allows players to download the software through an internet connection.
Once the download is complete, players still need to insert the Game-Key Card whenever they want to launch the game. However, the actual game files are stored on the console’s internal memory or compatible microSD Express card.
This is an important distinction for physical game collectors. Although Game-Key Cards are sold as physical products, they don’t offer the same experience as traditional cartridges containing the complete game.
For publishers, however, this format could offer a way to maintain a physical retail release without relying on the same amount of memory storage inside the game card.
That doesn’t automatically mean every publisher will switch to Game-Key Cards following Macronix’s announcement. But with manufacturing costs and component availability becoming increasingly important, the format could become more appealing.
Nintendo has already explained the format and its requirements in its official Nintendo Switch 2 Game-Key Card guide.
Nintendo Recently Confirmed It Has No Plans to Abandon Physical Games
There’s another reason why this announcement has attracted so much attention.
Just last month, Nintendo executive Bill van Zyll, vice president and general manager of Nintendo Latin America, confirmed that the company currently has no plans to abandon physical games.
Speaking during an interview with Brazilian YouTube channel Coelho no Japão, van Zyll explained that Nintendo pays close attention to consumer preferences when deciding how players should access its games.
He also pointed out that Nintendo Switch 2 supports both digital and physical releases, emphasizing that the company knows how much fans appreciate physical products.
That’s a pretty important statement, particularly when compared with what’s happening elsewhere in the industry.
Sony has already confirmed that it will discontinue physical disc production for new games releasing on PlayStation consoles starting January 2028. The announcement doesn’t affect titles released physically before that date, but it marks a significant change in PlayStation’s distribution strategy.
Nintendo, meanwhile, appears interested in maintaining both options for the foreseeable future.
However, there’s a difference between wanting to support physical games and being able to manufacture them at an affordable cost. Macronix’s decision could make that balancing act more complicated.
Nintendo’s Digital Game Sales Are Also Growing
There’s one more statistic worth looking at when discussing the future of Nintendo’s physical games.
According to Nintendo’s financial results for April through June 2026, digital sales accounted for 61.5% of its dedicated video game platform software sales by value. That’s an increase of 2.2 percentage points compared to the same period last year, when the figure was 59.3%.
However, it’s important to understand what this number actually represents.
Nintendo’s digital sales calculations include downloadable versions of packaged games, download-only releases, additional content, and Nintendo Switch Online subscriptions. Therefore, it doesn’t mean that 61.5% of all individual game copies sold during that quarter were digital downloads.
Still, the figures show that digital distribution is becoming an increasingly important part of Nintendo’s software business.
For publishers, that creates another reason to consider digital releases when physical manufacturing becomes more expensive or complicated.
But physical games remain a meaningful part of Nintendo’s business, and the company hasn’t announced any plans to abandon them.
Is This Another Sign That Physical Gaming Is Disappearing?
It’s becoming increasingly difficult to ignore the challenges facing physical gaming.
Between rising memory demand, manufacturing costs, and publishers shifting towards digital distribution, the industry is clearly changing. Macronix’s departure from ROM manufacturing is another example of how developments outside gaming can affect the products players buy.
However, I wouldn’t treat this as the beginning of the immediate end for Nintendo cartridges.
Nintendo still has alternative suppliers, an existing manufacturing ecosystem, and a customer base that continues to value boxed games. The company also recently made its position on physical media pretty clear.
The bigger question is whether traditional game cards will become more expensive to produce over the coming years.
If that happens, publishers could increasingly turn towards Game-Key Cards or digital-only distribution to avoid some of the costs associated with conventional physical releases.
And that’s probably what collectors should pay attention to. A game can still have a physical box and a card inside it without actually including the complete game data.
Personally, I’d much rather see Nintendo maintain traditional cartridges wherever possible. Being able to buy a game, put it on a shelf, lend it to a friend, or install it years later without depending on a digital storefront is a big part of what makes physical gaming enjoyable.
Macronix’s announcement doesn’t mean that experience is going away tomorrow. But it does show that keeping physical gaming alive depends on more than just whether players want it. The companies manufacturing the components need to find it worthwhile, too.
For now, Nintendo’s physical game plans remain unchanged. Whether the company can maintain that position without higher production costs is something we’ll have to watch closely.
