May's sessions painted a consistent picture of the European IT distribution market: strong revenue momentum on the surface, with growing complexity beneath.

The full-year forecast was revised upward to 4.4% growth following a remarkable Q1, which came in at 7.8%, well above the 3-4% initially projected. This exceptional first quarter was largely driven by aggressive forward buying, with resellers stocking up on PC infrastructure and components in anticipation of further price hikes rather than an organic surge in end-user demand.

Growth is expected to decelerate to 3.6% in Q3 and 1.7% in Q4 as IT budgets come under increasing pressure. The component shortage story, with RAM prices up approximately 140% year-on-year and server configurations up nearly 50%, remains the dominant force shaping revenue figures across virtually every category.

Component Prices: First Signs of Stabilisation

Our PriceWatch Component Index analysis, using July-September 2025 as a pre-shortage baseline, offered a nuanced picture across the three main categories:

• RAM, which had nearly quadrupled from the baseline, is now showing signs of stabilisation, flattening out in March and April.
• SSD prices roughly doubled, with France and the UK still trending upward while other major markets appear to be levelling off.
• HDD prices, which rose the least (peaking around 50% above baseline), are now in a downward trend in most countries, the clearest sign of market correction so far.

PCs: Revenue Up, Units Down

The latest personal computing data confirmed a notable early-Q2 shift. While Q1 saw strong growth in both units and revenues, early Q2 told a different story:

• Notebook revenues still up 12% year-on-year, but units in decline.
• Desktop revenues still positive at 2%, a sharp slowdown from Q1's 20%.
• Average sale prices up approximately 11% for both categories.

The culprit is not supply but a demand pullback: elevated stock levels from Q1 forward buying, combined with sharper-than-expected price rises, are suppressing reseller orders. One standout development was the Apple MacBook Neo, launched in March at a more mainstream price point, which captured 33% of Apple's notebook sales in European distribution in March and April, pushing Apple's notebook market share from around 9-10% in 2025 to over 14% by April, primarily at Intel's expense.

Cybersecurity: Identity Remains the Priority

The cybersecurity market accelerated into Q2, with April ending approximately 10% up year-on-year. Germany led at +40%, followed by Italy (+32%) and Sweden (+61%).

Investment priorities are clear: identity and access management is up 18%, infrastructure protection up 9%, and data security bounced back strongly to +13%, driven partly by compliance requirements from the EU Data Act and EU AI Act. MSP growth continues to outpace the wider market at 17% year-on-year, with a notable Italy spike attributed to a major government IT breach, new NIS 2 compliance deadlines, and a resulting wave of outsourcing contracts.

Regional Spotlights

Poland was extensively covered this month, with government digitisation programmes including an AI labs initiative deploying 192,000 laptops and 12,000 PCs to schools, and record cybersecurity investment exceeding 5 billion Polish zloty, driving exceptional year-on-year growth in desktops, servers, and disk storage, in some cases exceeding 40%.

The Baltics recorded 19% overall revenue growth in Q1, with servers up 134% year-on-year and graphics cards up 95%, fuelled by major private-sector investment. Notably, 14% of Baltic server sales in Q1 were AI-capable (accelerated) servers.

The UK delivered April revenues up 22.6% year-on-year, driven by infrastructure spending through corporate resellers. Consumer channels remain under pressure, with e-tailer consumer sales down over 12% in Q1, reflecting persistently low consumer confidence.

Enterprise Networking and UPS: Demand Returning

Enterprise networking showed a welcome turning point in April, delivering 37% revenue growth in switching. Wi-Fi 7 grew nearly 200% in revenue year-on-year, despite early discussion about customers potentially skipping directly to Wi-Fi 8 (whose formal certification is not expected until 2028).

In the UPS market, Q2 is running at approximately 5% growth year-on-year, driven by higher-protection systems in SMB and infrastructure environments. Online UPS grew roughly 38% and Line Interactive around 20%, while offline entry-level products declined, consistent with a broad market shift toward more resilient solutions.

The recurring theme across May's sessions is a market navigating a delicate balance: near-term revenue strength sustained by price inflation and forward buying, set against the real risk of demand exhaustion in H2 as budgets feel the strain.

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