It's fairly common in smaller dogs - min pins, chihuahuas, toy poodles, etc - and there is a name for it: cryptorchid. Sometimes neither testicle descends. In that case it's called a bi-lateral cryptorchid. Puppies are born with their testicles inside the body cavity. As they mature, the testicles move down and through the inguinal ring, which grows smaller and smaller. If the testicles don't descend through the inguinal ring before it closes, they are cryptorchid. Almost all dogs that are not neutered and are cryptorchid develop testicular cancer. Do yourself and the dog a huge favor and get him neutered.
There is no way the breeder could have predicted this. It just happens.