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CONTEXT Research Updates deliver timely insights on key market segments.

  • PCs
  • Displays
  • Imaging
  • Enterprise
  • 3D Printing

PC Research update


PC sales in Western Europe up by +38% in early March as Covid-19 drives demand for home-office equipment

London, 30 March 2020 – Volume sales of PCs through Western Europe’s largest distributors increased by +38% year-on-year in the first three weeks of March as the accelerating spread of coronavirus produced a surge in sales of remote-working devices, according to the latest data published by CONTEXT, the IT market intelligence company.

Displays


Covid-19 puts the brakes on slowing WE monitor market

London, 5 March 2020 – The business market drove growth of revenues from desktop monitors in 2019 and has continued to do so in January 2020: revenues from business-targeted monitors grew by +7% year-on-year while those of consumer-targeted monitors were up by +1% according to the latest data published by CONTEXT, the IT market intelligence company

Imaging


January print sales not impacted by coronavirus but Q1 and Q2 are at risk

London, 2 March 2020 – There is no clear evidence that print sales in January 2020 have been affected by the coronavirus according to the latest distribution data published by CONTEXT, the IT market intelligence company. Print performance could be weaker in Q1 2020, however, and the extent of this depends on how quickly the spread can be contained.

Enterprise


Coronavirus: The Enterprise market is reacting to the crisis

London, 07 April 2020 – The Enterprise market has been slower to react to the coronavirus crisis than the PC and AV-system markets – as early as February, resellers were stockpiling products in anticipation of supply disruption. However, it is possible to see the effects on the Enterprise sector in the Western Europe (WE) IT distribution channel now that numbers for week 12 have been included in the latest data published by CONTEXT, the IT market intelligence company.

3D Printing


Photopolymers and thermoplastics shine in 2019 as installed base of 3D printers grows

Increasing utilisation of photopolymer materials in 2019 was driven by a general rise in the installed base and by specific demand from dental applications while use of powder thermoplastics also grew thanks to strong sales of HP Multi Jet Fusion printers and a general push toward serial production




PC sales in Western Europe up by +38% in early March as Covid-19 drives demand for home-office equipment

London, 30 March 2020 – Volume sales of PCs through Western Europe’s largest distributors increased by +38% year-on-year in the first three weeks of March as the accelerating spread of coronavirus produced a surge in sales of remote-working devices, according to the latest data published by CONTEXT, the IT market intelligence company.

As the crisis across Europe worsened, and countries took successively stricter measures to contain the spread of the virus, the resulting demand for home-office equipment led to a +51% year-on-year growth in sales of notebooks and a +9% rise in those of desktops.  The increase was greater for business-targeted products: commercial notebook sales were up by +56% compared to +44% for consumer-targeted products while, for desktops, there was year-on-year growth (of +16%) only in the business-targeted segment.

Looking at the top Western European markets, the growth in notebook sales was led by Italy, the European country first hit by the outbreak and the first to introduce strict measures to slow down the spread: Italian distributors saw notebook sales increase by +110% in the first three weeks of March. Spain was next with a growth rate of +87%, followed by Germany (+52%), the UK (+50%) and France (+5%).

The surge in demand for home-working devices over the past couple of weeks has led to a significant reduction in notebook stock in a number of Western European countries. With incoming supply also disrupted to varying degrees (depending on the OEM and product category) by manufacturing and logistics issues, providing PCs for the rising number of home workers could turn into a challenge over the next few weeks.

The present exceptionally strong growth rates are related to the sudden need to migrate employees to home-working and are expected to be temporary. Nevertheless, in many organisations, the current crisis is likely to have raised awareness of the economic necessity of providing sound digital solutions, and this is expected to result in increased investment in this area over the longer term.

                            Y/Y PC volume growth: Western European distribution

                        Commercial PC volume sales: Western European distribution




Covid-19 puts the brakes on slowing WE monitor market

London, 5 March 2020 – The business market drove growth of revenues from desktop monitors in 2019 and has continued to do so in January 2020: revenues from business-targeted monitors grew by +7% year-on-year while those of consumer-targeted monitors were up by +1% according to the latest data published by CONTEXT, the IT market intelligence company.

For many vendors, 2019 was a very successful year in terms of desktop monitor sales. As 2020 begins, distributors are seeing consistent growth in demand for business-targeted monitors with sales up +4% year-on-year in January. And, even though this is less than the growth seen in the consumer market (+6%), it is coming from a very strong baseline: in January 2019 sales of business-oriented monitors grew by +12%. Along with greater demand, increased sales in higher price ranges (particularly in the €200–€300 category) have helped to drive revenues in the business segment to +7% year-on-year. Sales of consumer monitors were driven by those in lower price ranges (€100–€150), so revenues here were up by only +1%.

The increased sales of more expensive business monitors were spread across most distribution channels, and sales to corporate resellers grew by over 50%. This was driven by demand for 23.8", 27" and 29" models and those with USB-C ports – 60% of monitors in the €200–€300 price bracket sold to this channel offered this type of connection.

Desktop monitors: Business-targeted models in price range €200-€300, WE distribution.

Initially, after many quarters of growth in Western Europe, sales of desktop monitors were expected to slow down in 2020 with a modest growth in the first half of the year, continuing to benefit from PC refreshes as businesses that have delayed the implementation of Windows 10 make the transition. However, the recent coronavirus outbreak could change that scenario. While vendors may have already secured supplies of panels and other components for Q1, the impact of factory closures and production delays could be felt as early as Q2. The resultant product shortages in Q2 could lead to a pick-up in demand in the Q3 and price rises that have the potential to make H2 the stronger part of the year.

Despite production turbulence, vendors are aiming to keep revenues high by launching more innovative models and creating their own high-margin niches by focussing on, for example, models with high-resolution or refresh rates, improved ergonomics or touchscreens, or aiming models with advanced graphics capabilities at not just gamers but also users of other specialised applications.




January print sales not impacted by coronavirus but Q1 and Q2 are at risk

London, 2 March 2020 – There is no clear evidence that print sales in January 2020 have been affected by the coronavirus according to the latest distribution data published by CONTEXT, the IT market intelligence company. Print performance could be weaker in Q1 2020, however, and the extent of this depends on how quickly the spread can be contained.

This will also determine whether there will be an impact on one quarter, two quarters or more. We also believe that there will be an impact on component supply, and Q2 shipments are likely to be affected. If it takes longer than the end of March to contain the virus, a bigger impact is expected with production and demand possibly shifting to 2H 2020.

Considering this, vendors might push their customers to bring project-based purchased forward, as waiting could mean that shortages will have a knock-on effect on pricing and customers will then end up paying a premium price.

The ongoing shutdown of operations by China’s major tech manufacturing centres in response to the new coronavirus could have a massive knock-on effect on project fulfillment across WE, and it could, in addition to the disruption caused by the Trade War (between U.S. and China) also have a lasting impact on global supply chains.

The start of Q1 2020 saw printer sales continue to follow the pattern that has characterised the past few quarters, with healthy demand for consumer multi function printers (MFPs), according to the latest distribution data published by CONTEXT, the IT market intelligence company.

However, volume sales of printers through the largest distributors in Western Europe (WE) were down by -2.3% year-on-year in January 2020. Although the consumer segment saw sales increase by +5.8% – mainly driven by good performance from inkjet MFPs (+7.5%) and laser MFPs (which saw exceptional growth of +22.8%) – sales of single-function printers (SFPs) in this market continued to fall sharply (-11.6% for inkjet SFPs, and -23.8% for laser SFPs).

Sales of, and revenues from, consumer inkjet MFPs increased in almost all WE countries during January 2020 with the United Kingdom seeing the strongest growth (+34.7% in terms of units and +20.4% in revenues). In Italy, consumer printer sales also continued to rise (year-on-year increases of +2.9% in units sold and +6.2% in revenues) with most retailers and small resellers benefiting from minimum order sizes and credit lines offered by the Distribution channel.

   Graph 1: Consumer printer volumes and Y/Y change by category – WE distribution 

Looking at the business targeted-customer segment (which account for 34% of printer sales and 67% of revenues in WE), we saw a sharp decline in early Q1 2020. The fall of -14.8%, mainly driven by poor performance of MFPs across almost all countries (sales of both inkjet and laser MFPs were down by -18.5%), led to a drop of -11% in revenues. This trend in MFP sales is likely to change in the coming months, particularly in Italy where the recent award of a government tender/contract for multifunction and Managed Print Services (MPS) for Public Administrations (Regional/Municipal offices) with an overall value of €100 million will push up sales in this category.

Graph 2: Business printer volumes and Y/Y change by category – WE distribution

 

 




Coronavirus: The Enterprise market is reacting to the crisis

London, 07 April 2020 – The Enterprise market has been slower to react to the coronavirus crisis than the PC and AV-system markets – as early as February, resellers were stockpiling products in anticipation of supply disruption. However, it is possible to see the effects on the Enterprise sector in the Western Europe (WE) IT distribution channel now that numbers for week 12 have been included in the latest data published by CONTEXT, the IT market intelligence company.

                                    UC and collaboration revenues: Y/Y    

As expected, the UC and collaboration segment – which includes business communication and collaboration products such as VOIP systems, headsets and cameras – is performing well, boosted by the growing numbers working from home. As the graph above shows, the gains of week 11 accelerated in week 12, and we are expecting this trend to continue into April.

                                   Network management and security: Y/Y

Network management and security – the category that includes VPNs, gateways and firewalls – is also on the up as businesses update their networking infrastructure to enable their employees to work from home. This is especially true of SMBs, many of which did not previously have the infrastructure in place to allow remote working. The change is even more noticeable given that this segment of the market had been in constant decline throughout 2019 and into January 2020.

                              Virtualisation and security software revenues: Y/Y

The current situation is also proving positive for the Enterprise software segment, with virtualisation and security software benefitting. The need for more endpoint security licenses, networking security licenses, and virtual machines is pushing up sales in those categories.

                                                Infrastructure units: Y/Y

The other side of this story is the reduced demand for IT infrastructure as confinement and lockdowns have an increasing impact on sales with those of servers and network switches showing more marked signs of decline in week 12. However, confirmation of whether or not this is a real trend will come in the next few weeks – the end of the quarter could bring a few deals that make up the loss. Even so, business closures are leading to a marked break in infrastructure investment. For example, we understand that resellers in Southern Europe cannot reach their traditional clients who are closing or, at best, re-focusing their resources into managing the crisis rather than investing in IT infrastructure. We are also seeing the same decline in demand for wireless infrastructure as offices empty and the installation of wireless access point networks is delayed or cancelled.

Looking forward, software and collaboration products should continue to thrive, and businesses are also likely to need more networking equipment to enable and optimise homeworking. Conversely, there is a worry that demand in the infrastructure segment will slow further as the confinement rules remain at the current levels.




Photopolymers and thermoplastics shine in 2019 as installed base of 3D printers grows

London, 13 February 2020 –The Industrial/Professional printer market (that is, for all printers above $5,000), has seen a +8% rise in polymer material utilisation over the last twelve months. Within polymers, photopolymers have seen the most significant near-term growth with volume used and revenues generated from use both seeing growth of +21% over the trailing twelve months (TTM) through to Q3 2019. For thermoplastics, although the overall increase in utilisation was up only +6% for the period, the powder-based side of this market saw good growth thanks mostly to a rising installed base of HP multi-jet fusion machines across the globe.

Charts 1 and 2: Global material utilisation by Industrial/Professional printers Trailing-Twelve-Months (TTM)

For Photopolymers, while there is an underlying increase in material utilisation as the market shifts from one principally focused on prototyping to one where mass production is also a key usage, near-term increases in material sales were more the result of a growing base of installed printers for traditional 3D printing uses. One such market which has traditionally embraced 3D printing for its unique ability of mass customization (that is, tweaks to each individual product manufactured) is dentistry. Photopolymer utilisation for this historically strong dental sub-sectors was particularly strong in the TTM to the end of Q3 2019, seeing a +29% increase in throughput. Increased photopolymer utilisation was also supported just in general by the accelerating installation of vat photopolymerisation printers in the TTM to Q3 2019 which were up +28% from a year before.  Strong sales of all price-classes* of Industrial/Professional stereolithography printers from the likes of 3D Systems, EnvisionTEC, UnionTech and Carbon were seen, helping to grow the installed base. Overall shipments of stereolithography printers – laser based, LCD, DLS/CLIP and especially those leveraging DLP engines – outpaced the retirement rate of legacy printers in the field, leading to a larger operational base of Industrial/Professional printers which resulted in accelerated material usage.

Chart 3: Global Industrial/Professional printers installed by primary material/process

 

The thermoplastics market is even larger than the Industrial/Professional photopolymer market. This part of the 3D printing polymers space is dominated by material extrusion machines but recent growth in material utilisation is linked to powder bed fusion (PBF) technologies. The period Q4 2018 to Q3 2019 saw a huge increase of +41% in the number of polymer PBF printers installed, driven by growing sales of HP’s Multi Jet Fusion technology. HP offers both Industrial* price-class printers, for mass production, and Design* price-class printers, mainly for more typical 3D printing applications like prototyping and short-run production.

* 3D printer segment by price class: INDUSTRIAL ≥ $100K, DESIGN = $20K–$100K, PROFESSIONAL = $2.5K–$20K, PERSONAL ≤ $2.5K (excludes do-it-yourself DIY kit printers)

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