In July, we took stock of the first half of the year, with the data available for the entirety of Q1 and Q2. We used CONTEXT’s weekly webinar briefings to deliver this insight, sharing the data and trends that matter, so that your business can move forward with confidence. 

Here are our top stories in more detail:

Q2 results show regional bounce back

The official results are in, and Q2 saw revenue sales growth of 2.1% year–on–year (YoY) across European distribution. This compares to our central forecast of –1.3% (including telecoms). Germany and the UK have performed particularly well over the past four quarters – Germany went from –13% growth in Q1 2024 to –2% in Q2 2024, while the UK moved from –4% to 6% growth over the same period. Across Europe, the volume business has returned to growth for the first time since late 2022, at 3% YoY in Q2 2024, overtaking value. Regarding individual categories, there were some obvious winners (LFDs, servers, personal systems, AV systems, and accessories) and some losers (wireless, networking switches, and services).

June reseller count down as smaller businesses consolidate

Our latest research into reseller counts highlights an unusually pronounced dip in numbers in June 2024, particularly in Italy and the UK. This is the first time that reseller numbers have dropped below 17,000 in Italy; they’re now down 10% YoY to 16,110 last month. We understand that increasing consolidation of small resellers in Italy is contributing to this dip. In the UK, there are 13% fewer resellers than a year ago. This has pushed revenue per reseller up, especially in France (€63,693) and the UK (€132,444). The UK has a revenue per reseller figure around double that of the average across the main European markets due to the concentration of resellers here.

AI–capable notebooks now comprise a quarter of the market

Each week in the weekly webinar, CONTEXT is now analysing and sharing data on AI–capable notebooks – PCs based on chipsets with neural processing units (NPUs), irrespective of their TOPS performance. This includes the Apple M, Intel Core Ultra, AMD Ryzen AI, and the Qualcomm Snapdragon X. As of Week 29 – the third week in July – these notebooks comprised 23% of all notebooks sold through distribution in Europe, down only slightly from 26% in the prior week. Apple and Intel have the lion’s share, with Qualcomm on 3%.

We are seeing the vast majority of Copilot+ PCs going into consumer channels, with units ramping up through business channels in the coming weeks and months. We need to bear in mind that, as this analysis is for sales through distribution, it excludes sales going directly from OEMs to retail.

Italy turns around

Italian GDP declined by –3.7% in 2023, but is expected to turn around with 1.7% growth in 2024 and 3% in H1 2025. We started to see recovery in Q2 2024, which recorded 1% revenue sales growth – the first quarter of growth following six consecutive quarters of decline. Within that figure, there were some highlights – personal systems up 14% YoY and software & services up 12% – and some lowlights – infrastructure sales declining –13% YoY. We are confident that overall distribution sales in Italy will continue to show positive growth in the third and fourth quarters, driven by software and storage categories, more favourable comparisons, and Windows 11–driven PC sales growth.

A poor Q2 for warranties

All three countries tracked by CONTEXT in Q2 2024 recorded a YoY revenue decline in warranties. The biggest drop was in Germany (–24%), followed by France (–18%) and the UK (–8%). This applies to warranties in both the server and computing markets. While this decline is somewhat expected given the delayed refresh cycle for machines, other factors may contribute to the poor performance of warranty sales in servers. Possible explanations include a shift to online claim processes and resources, increased focus on standard warranties, and a change in buyer behaviour, which may be driving server buyers to seek out non–standard warranties from third–party providers.

In the meantime, register to attend CONTEXT'’s weekly IT Industry Forum webinars to get the latest data and analysis from our pan–European team by filling in your details below.