According to Wallstreet Journal, the Nintendo Switch shortage is due to way higher demand for some components than what the market can produce at the moment.
Nintendo has told its suppliers and assemblers that they are hoping to reach 20 million units of the Switch by the end of fiscal year 2017, which ends in March 2018.
But there is a problem: shortage of components used in smartphones, computer servers and other digital devices. Among these are "the NAND flash-memory chips that store data, as well as liquid-crystal displays and the tiny motors that enable the Switch's hand-held controllers to imitate the feel of an ice cube shaking in a glass."
According to Toshiba Corp., the demand for NAND flash memory is much greater than supply. The situation is likely to stay that way for the rest of the year. Toshiba cited big demand from smartphone makers, like Apple. Unfortunately, according to wsj.com, Nintendo and Apple refused to comment about the assumed issues in the supply chain.
Also, according to analysts, Nintendo's rivals can often offer better terms than what the big N can do. One solution would be to spend more money to secure more parts, but that could lead an increase in price of the Switch. Nintendo's president Tatsumi Kimishima has previously stated that he doesn't want to sell Switch at a loss.
Demand for Switches is also high because one household may see the need multiple devices: one for each member of the family.