Growing concers surrounding the slow demand of the PS3 is having an impact on some of its partners. Nvidia was one of the high profile firms to feel the pressure of Wall-Street today. Analysts view that availability has improved and a lack of demand stems from high prices and poor quality titles.
Santa-Clara Calif.-based Nvidia, which provides the technology behind the system's advanced graphics and special effects, may take a hit as a result of the slowdown.
"Sony royalties garnered by Nvidia from the PS3 build are expected to be the primary driver of Nvidia's gross-margin expansion in fiscal 2008," Michael McConnell, semiconductor analysts of Pacific Crest said.
"Although poor manufacturing yields on Blu-Ray diodes were the initial cause of PS3 unit constraints at retailers, we have seen evidence of weaker-than-expected consumer demand as availability has improved, likely stemming form overly high prices at retailers and a lack of compelling game titles."