TOKYO, Nov 4 (Reuters) – Nintendo Co LtdOn Thursday, Switch cut its sales forecast for the full year by 6%. It also stated that it was struggling to satisfy demand during the crucial year-end season because of chip shortages.

Many companies warned about the potential dangers of a global shortage of semiconductors, but most of them have not cut their goals.

Toyota Motor CorpIt was also an exception that Thursday and reduced its vehicle sales outlook for the year ending March.

Shuntaro Fuukawa, Nintendo president, stated that “we can’t produce enough” to satisfy holiday demand. This was after the Kyoto-based company reduced its Switch sales goal by 24 million units.

He stated that “Currently, there are no signs of improvement” and that the situation is still severe. So he couldn’t predict how much longer it would continue.

Operating profit for the second quarter fell by 32% to 100 million yen ($880 millions) from the previous year. However, the company raised its annual projections 4% to reach 520 billion dollars thanks to a weaker Japanese yen.

Switch sales, now in their fifth year of existence, fell by one third to 8.28 millions units over the six month period ending September compared with the same time last year.

A smaller decline was seen in year-over-year sales. Nintendo also increased its full year forecast for software by 5% to 200 millions units. It is not uncommon for it to raise targets that are conservatively viewed during the financial year.

Serkan Toto of Kantan Games, the founder, said, “That’s with a weakening Corona effect, and without an epic blockbuster such as “Animal Crossing”, this refers to the surge in stay-at-home gaming that occurred during the pandemic.”

Investors and analysts are engaged in intense discussions about when peak Switch sales will occur, given that console gaming is highly seasonal and Nintendo dependent upon a single system.

Nintendo released the Switch OLED model for $349.99 on Oct. 8, however, it is in very limited supply in many markets.

The improved model is proving to be a boost in sales, according to early data. Some observers are concerned that buyers may be upgrading from existing customers. This could reduce the chances of software sales bouncing back.

Atul Goyal (an analyst at Jefferies) wrote that “our main concern” is still the lackluster Nintendo game pipeline and a declining tie ratio. This is expected to lead to lower earnings.

Tie-ratio, which refers to how much software is purchased by hardware owners, is closely monitored.

Nintendo keeps releasing high-profile titles for its system. “Pokemon Remakes” will launch later in the month, while “Pokemon Legends Arceus” will go on sale in January.

Nintendo shares were down 1.7% in advance of earnings. They also suffered a 25% loss this year.