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CONTEXT Research Updates deliver timely insights on key market segments.

  • PCs
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  • Imaging
  • Enterprise
  • 3D Printing

PC Research update


Workstation sales across Western Europe up again in early Q4 2019

London, 15 November 2019 – Combined sales of notebook and desktop workstations through Western Europe’s largest distributors continued to rise in early Q4 2019 following healthy consolidated growth during the first three quarters of the year, according to the latest distribution data published by CONTEXT, the IT market intelligence company. Volume sales were up by +3% year-on-year in October having increased by +7% over Q1 to Q3 2019.

Displays


October sales through WE distributors meet expectations, sales up by 7%, but pricing pressure is growing

London, 3 December 2019 – Sales of desktop monitors through Western Europe distributors grew in early Q4 2019 following the trend begun in the earlier three quarters of the year. Sales were once again driven by higher demand in consumer channels, according to data published by CONTEXT, the IT market intelligence company.

Imaging


Early Q3 sees healthy demand for consumer and business laser MFPs

London, 11 September 2019 – The start of Q3 2019 saw printer sales continue to follow the pattern that has characterised the past few quarters, with healthy demand from consumer and business laser multifunction printers (MFPs), according to the latest distribution data published by CONTEXT, the IT market intelligence company.

Enterprise


Wi-Fi 6 adoption gathers pace in WAP market

London, 22 January 2020 – Despite a slowdown in wireless access point (WAP) sales in Q4 2019, adoption of the Wi-Fi 6 standard is pushing up revenues in the Western Europe (WE) IT distribution channel as its market share increases, according to the latest data published by CONTEXT, the IT market intelligence company.

3D Printing


Industrial class 3D printing sector sees surprising growth in spite of headwinds

Shipment growth for Industrial polymer 3D printers driven by HP globally and by UnionTech in China; metal 3D printer growth driven by upstarts like Desktop Metal as more traditional powder bed fusion vendors struggle.




Workstation sales across Western Europe up again in early Q4 2019

London, 15 November 2019 – Combined sales of notebook and desktop workstations through Western Europe’s largest distributors continued to rise in early Q4 2019 following healthy consolidated growth during the first three quarters of the year, according to the latest distribution data published by CONTEXT, the IT market intelligence company. Volume sales were up by +3% year-on-year in October having increased by +7% over Q1 to Q3 2019.

The latest rise was due to growing sales of both mobile and stationary systems: mobile workstation sales increased by +2% year-on-year while those of desktops were up by +4%. This growth was mostly confined to the top three vendors in the distribution channel: HP, Lenovo and Dell.

Workstation demand in 2019 has so far been driven by a number of factors. Among these are Windows 10 migration, new product launches, and the rising need for high-performance systems – not only in traditional fields, such as engineering and design, but also for new applications including AI and virtual reality.

Although workstations remain a small segment within personal systems in terms of volumes, they represent important revenue and margin drivers: while accounting for only 2% of PC systems sold through Western Europe’s largest distributors in October, they generated 5% of PC revenues. During this time, distributor average sell prices were €1,472 for mobile and €1,127 for stationary workstations (excl. BTO).

                                   Workstation volume sales: WE distribution

                     Distributor average sell price (ASP) in €, excl. BTO: WE




October sales through WE distributors meet expectations, sales up by 7%, but pricing pressure is growing

London, 3 December 2019 – Sales of desktop monitors through Western Europe distributors grew in early Q4 2019 following the trend begun in the earlier three quarters of the year. Sales were once again driven by higher demand in consumer channels, according to data published by CONTEXT, the IT market intelligence company.

In the first month of the quarter, combined sales of business- and consumer-targeted monitors were up by +7% year-on-year. While Q3 saw increased sales of business models alone, sales in both segments were up in October and, as expected, overall growth was driven mainly by increased sales to consumer etail and retail.

                Desktop monitors: Revenue share by channel, WE distribution

 

Historically, November – which includes the weeks leading up to Black Friday – has been a very strong month for consumer monitors. Last year, however, sales had already started to pick up in October, and distributors have seen the same thing happen this year: sales to consumer channels (etail and retail) in Germany, UK, Spain and France were +30% higher than in September. In Germany, month-on-month sales grew by over 60% in October. However, sales were lower than in 2018 (falling by -1%) showing that the market is slowing down. It is interesting to note that in October revenues from sales to consumer etail again reached their highest yet market share of over 30% and are now similar to those generated by sales to SMB resellers.

This year has also seen a different trend in terms of pricing. Last year, there was an increase in the number of €200–€250 models distributors sold to consumer channels whereas, this year, sales have been driven by increasing sales of cheaper 23.5", 22" and 21.5" models costing less than €200.

While it is still expected that Q4 volume sales will be strong (with most of the demand being in October and November), the gradual slow down in the monitor market will trigger more aggressive behaviour from vendors – and any increased price competition may affect this year’s desktop monitor revenues.

            Desktop monitors: Average Selling Price (ASP) by channel, WE distribution

       Desktop monitors: Sales to consumer channels by price band, WE distribution




Early Q3 sees healthy demand for consumer and business laser MFPs

London, 11 September 2019 – The start of Q3 2019 saw printer sales continue to follow the pattern that has characterised the past few quarters, with healthy demand from consumer and business laser multifunction printers (MFPs), according to the latest distribution data published by CONTEXT, the IT market intelligence company.

However, volume sales of printers through West Europe’s largest distributors were down by -4.4% year-on-year in July 2019. The sharp growth of +9.1% in sales of laser MFPs (mainly driven by the exceptional growth of +30% Y/Y in the consumer segment during early Q3), was offset by the sharp decline of inkjet devices (SFPs -15.5% and MFPs -6.4%) and laser SFPs (-6.9%). With distributors reporting that reseller demand for SFPs, particularly lower-spec models, is low, the ongoing shift from single- to multifunction devices is likely to be further consolidated.

Business laser MFPs, which account for 73% of sales and 89% of revenue, registered a small year-on-year volume growth of +2.9% in July 2019, leading to an increase in revenue of +9.3% and reversing the negative trend the market saw in 2018 and 2019.

Sales of, and revenues from, laser MFPs increased in almost all WE countries in July 2019. In Italy, overall printer sales continued to grow in terms of both units and revenues (+14% and +28% year-on-year respectively) with most retailers and small resellers buying from distributors thanks to their ability to offer credit lines and smaller minimum order sizes. Vendors are also benefiting from this shift which transfers financial risk to the distribution channel. However, the question now is how much distributors will ask from vendors to compensate for the higher risk they are taking.

The United Kingdom also registered strong year-on-year growth in sales of laser MFPs in July 2019, in terms of both units (+12%) and revenues (+11%), driven by the business segment (+9.2%) which accounts for 87% of laser MFP sales (96.4% in terms of revenue) in the country. Consumer laser MFPs registered outstanding growth (sales up by +33% and revenue +31%) but they only account for 13% of sales and 3.6% of revenue.

It is expected that both consumer and business demand for laser MFPs will remain strong throughout the second half of 2019 as new products become available. Lexmark, for example, is to roll out a much-needed revamp of its colour laser printers: its GO Line of more compact and faster SFPs and MFPs aimed at small and medium businesses will be available worldwide by mid-September.

While a range of promotional activities during the upcoming back-to-school and Black Friday periods are likely to lead consumer sales for the rest of the year, overall printer demand is expected to remain soft.

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

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




Wi-Fi 6 adoption gathers pace in WAP market

London, 22 January 2020 – Despite a slowdown in wireless access point (WAP) sales in Q4 2019, adoption of the Wi-Fi 6 standard is pushing up revenues in the Western Europe (WE) IT distribution channel as its market share increases, according to the latest data published by CONTEXT, the IT market intelligence company.

                                                    WAP revenue: WE

                                                      WAP units: WE

As shown in the two graphs above, WAP revenues in the final quarter of 2019 were almost flat – only -0.9% down on the previous year – while there was a -4.5% year-on-year decline in WAP units sold; this hints at an increase in average selling prices.

                          Q4 2019 WAP unit and revenue growth: Top 5 WE countries

Of the Top 5 WE economies, the UK saw the greatest revenue growth in Q4 2019 with a +9.5% year-on-year increase even while units fell by -10.2%.

                                                    WAP revenues by Wi-Fi type

                                                      WAP units by Wifi type

The main factor driving growth in Q4 was the increasing sales of Wi-Fi 6 access points, which now account for 18% of WAP revenues and 12% units sold, showing that adoption of the latest Wi-Fi standard is gathering pace.

                                  Wi-Fi 6 WAP revenue: country share of market

 

It is in the UK that the adoption of the new standard is currently most important with the country being responsible for 32% of WE Wi-Fi 6 revenues in Q4 2019; Germany follows, generating 21% of revenues, then the Nordic countries with 18%. As often happens, Northern Europe is at the forefront when it comes to implementing new technology while Spain and Italy lag behind.

As Wi-Fi 6 adoption is a planned change, there is nothing really surprising about these trends; the growth of the new standard will continue throughout 2020, reaching a market share of over 50% towards the second half of the year. The relative slowdown in WAP sales is more interesting. We think this trend will continue – Wi-Fi coverage in WE has definitely reached a tipping point. With those locations where it is still not available being too costly to cover, the future could instead lie in 5G networks: TIM’s latest tests in Italy have demonstrated particularly impressive 5G bandwidths of more than 2Gbps. The possible impact on WAP sales of the extension of 5G network coverage could well make 2020 a challenging year for wireless networking vendors, especially if businesses opt to rely on 5G networks in some cases rather than Wi-Fi networks.




Industrial class 3D printing sector sees surprising growth in spite of headwinds

London, 16 January 2020 – Shipments of Industrial* 3D printers priced at $100K+ were up by +8% in Q3 2019 compared to the same period the previous year. This key sector – which accounted for almost 70% of all 3D printer revenues for the period – saw even more impressive shipment growth of +12% on a trailing twelve month (TTM) basis. The increase came as a surprise given the headwinds many vendors reported in the second half of the year: reduced demand from the struggling automotive sector, sluggish European economies and a generally weak global industrial manufacturing market all impacted the bottom line of many companies in the third quarter.

In the Industrial polymer 3D printer market, HP (now #2 in global shipments) saw excellent growth, shipping +347% more printers in Q3 2019 than in Q3 2018 as it continued to roll out its more affordable colour-capable units as well as began to ship the newest iteration of its most advanced, highest-end, production-focused models in volume. The Chinese domestic market also grew, mostly thanks to leading Chinese vendor UnionTech.

While Industrial metal printers made up just 32% of unit shipments in the class over this period, they accounted for just over 51% of revenues; metal 3D printing is one of the fastest growing additive manufacturing segments and has seen shipments grow at an average rate of +30% over the last two years. However, the dominant technology – powder bed fusion – began to struggle in the second half of 2019. In the third quarter, -19% fewer metal powder bed fusion 3D printers shipped than in the same quarter the previous year, with market leaders EOS and GE Additive both seeing weaker shipments not only for the quarter but for the trailing 12-months as well. Even so, aggregated shipments of metal 3D printers grew by +11% as a different technology began to take centre stage, driven by Desktop Metal and Markforged. The new crop of material extrusion metal 3D Printers – which saw year-on-year shipment increases of +43% – addresses new markets for prototyping and entry-level metal printing. Since many of these markets are outside the aerospace, automotive and medical sectors that currently use powder bed fusion machines, the growth in shipments of extrusion models was not related to the decline in those of the other type of machine.

Chart 1: Global Industrial price class 3D printer shipments and growth by material

There was good growth in North America and China during Q3 2019, where year-on-year increases in Industrial 3D printer shipments were +22% and +36% respectively, while the global #2 market, Western Europe, saw shipments fall by -28%. Sales in this sector of the market tend to be more provincial than in other industries: there is less East–West trade because of logistics (most Industrial printers are very large and very heavy) and because of less-than-favourable global trade conditions which make it difficult for emerging technologies like 3D printing to flourish. These trends held true in the third quarter when Chinese vendors flourished in domestic China while US and European vendors again saw most of their business come from the West.

Other printer classes

Of the three other major price classes for finished-good printers - Personal, Professional and Design – shipments of printers in the Professional class were most notable. Printer shipments in the third quarter in the Design segment was largely flat and shipments of Personal class printers continued to struggle, losing ground to kit-based solutions like those from China's Creality3D. The Professional segment continued to shine however, growing by an excellent +21% on the previous year and a solid +17% on a TTM basis. Many vendors who formerly focused on the yet-to-explode consumer market have shifted their product lines to move into this price class. Especially noteworthy in the Professional class in the quarter was the performance of Formlabs which finally began shipping new models in volume against strong pent-up demand and surged to the top of the market in this class as the availability of their new products was bolstered by glowing reviews.

Chart 2: Global 3D printer unit shipments and TTM growth by price class (note two scales)

Many forecasts for Q4 2019 and on into 2020 turned a bit cautious toward the year end due, in part, to weaker demand from key geographies, to softening orders from key vertical markets, and to uncertainties associated with global trade. The period was also marked by significant managerial changes atop leading companies, also contributing to near-term uncertainty.

* 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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