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Macronix, one of Nintendo’s longtime memory chip suppliers, is gradually exiting the ROM business, raising questions about the future of physical game cartridges for Nintendo Switch and Switch 2. According to industry analyst David Gibson, the company is shifting its manufacturing capacity toward other memory products and will no longer develop new ROM chips.
Gibson shared the details in a series of posts discussing Macronix’s latest financial results. The company manufactures ROM chips used in physical game cards for both Nintendo Switch generations, making its decision particularly relevant to Nintendo’s physical software business.
ROM products accounted for just 5% of Macronix’s revenue in the third quarter, down from 26% during the same period last year. Sales in the segment declined 39% year over year, although they increased 9% compared to the previous quarter.
According to Gibson, Macronix’s chairman explained that the company has limited manufacturing capacity and is prioritizing NOR and eMMC memory chips instead. None of its planned NT$37.8 billion in capital expenditure will go toward ROM production, with the investment directed entirely toward eMMC and NAND memory.
The third quarter will also be the final period in which Macronix reports ROM sales as a separate business segment.
Despite the decision, Gibson doesn’t expect physical Nintendo Switch 2 game cards to disappear immediately. Macronix isn’t Nintendo’s only supplier of game card memory, meaning other manufacturers can continue supporting physical releases.
He believes the change could gradually accelerate Nintendo’s transition toward digital distribution, particularly through Game-Key Cards and digital-only releases. Unlike traditional physical cartridges, Game-Key Cards contain a download key rather than the complete game data, requiring players to download the software.
Nintendo’s digital software sales have already been increasing. During the April to June quarter, digital purchases accounted for 61.5% of software sales, compared to 59.3% during the same period last year, an increase of 2.2 percentage points.
The proportion has fluctuated considerably depending on major physical game releases, ranging from 46.1% to 67.2% over the past year. Nintendo’s July to September digital sales figures are expected to be published alongside its financial results on Thursday.
Macronix has supplied memory products for Nintendo hardware across several generations, including the Nintendo 64, Nintendo 3DS, Nintendo Switch, and Switch 2. Its longstanding relationship with Nintendo has historically made game cartridge production an important part of its semiconductor business.
The announcement comes as Nintendo Switch 2 continues to expand its installed base. The console has reached 23.68 million units sold worldwide, having sold more than 3.5 million units during its first four days. It has also surpassed the GameCube’s lifetime sales of 21.74 million units.
