Macronix Phases Out Switch ROM Production to Expand Data Center Flash Memory

Taiwanese memory manufacturer Macronix International is winding down its read-only memory (ROM) production line, phasing out the legacy chip architecture used in physical game cartridges for Nintendo Co.'s original Switch console.

Macronix chairman Miin Wu confirmed the planned exit during an investor conference reported by the Taipei Times and subsequently covered by Engadget (https://www.engadget.com/2306886/nintendos-main-switch-cartridge-supplier-is-leaving-the-rom-business/). The decision illustrates how infrastructure demand across enterprise computing and artificial intelligence workloads is reordering fab schedules, pulling silicon capacity away from mature consumer media.

The withdrawal follows a sharp decline in Macronix's ROM business, where annual sales fell 39 percent year over year. Dedicated ROM chips contributed 5 percent of company revenue in the third quarter of 2026, down from 26 percent in the third quarter of 2025. Following the current reporting cycle, Macronix will no longer disclose ROM sales as an independent balance-sheet segment.

The product retirement coincides with record earnings for the Hsinchu-based semiconductor maker. Macronix posted third-quarter net profit of NT$10.95 billion ($337.8 million), climbing 42 percent from the second quarter and reversing a net loss of NT$862 million recorded during the same period in 2025. Gross margin expanded to an all-time high of 70.5 percent, up from 13.5 percent a year earlier, driven by supply constraints and broad chip price increases.

Wu told investors that enterprise clients are actively competing for server allocations of NOR flash memory deployed in data centers. Alongside cloud infrastructure, the company plans to concentrate its NOR flash production on specialized, high-margin sectors, including aerospace communications, automotive systems, medical equipment, and industrial hardware.

At the same time, Macronix is channeling capital into NAND flash lines, including embedded multimedia cards (eMMCs) and 3D NAND chips, after competitors such as Samsung Electronics exited certain legacy memory segments. The shift shields newer console hardware from the phaseout: physical game cards for the Nintendo Switch 2 rely on NAND flash memory rather than mask ROM, leaving the platform's supply chain outside the discontinued line.

Shifting distribution economics have also eroded demand for dedicated ROM fabrication. Digital downloads accounted for 61.5 percent of Nintendo's software sales in 2026, trailing even higher digital volumes reported across Sony PlayStation and Microsoft Xbox ecosystems.

Macronix expects to bring new NAND and NOR capacity online during the second half of 2027 backed by an initial NT$22 billion capital expenditure program, while an additional NT$15.8 billion expansion has been pushed to 2028 due to equipment delivery delays.