Research Updates

London, 09 April 2019 –  Volume sales of PCs through Western European distributors were down by -‍2.4% in Q1 2019 compared to last year as consumer demand remained weak and Intel chip supply tight, according to the latest distribution data published by CONTEXT, the IT market intelligence company.

Consumer PC sales declined by -11.3% as people continue to shift towards using smartphones for day-to-day tasks and see little reason to buy new machines. Notebook sales dropped by -12.1% while those of desktops were down -7.6%. The general fall was exacerbated by the effects of political and economic conditions in some of countries: for instance, in the UK, where consumer confidence is low amidst Brexit-related uncertainty, consumer PC sales dropped by -17.6%.

As in the past few quarters, the situation was much healthier in the commercial segment. Business PC volume sales were +4.6% up on last year, driven by the end of Windows 7 support in early 2020 and the need to modernise workplaces. Sales of notebooks increased by +6.6% and desktops by +0.6%. The increase in workstation sales, which has been ongoing for quite some time now, continued with a +11.3% growth in mobile systems and a +4.9% increase in sales of stationary ones.

The tightness of Intel’s chip supply has led to greater fluctuations in distributor stock movement over the past few quarters as vendors try to steer demand to match available supply. Some vendors have also added more AMD-based PCs to their portfolios to provide an alternative offering and, as a result, the overall share of AMD-based PCs this quarter was up to 6.7% of commercial sales and 14.7% of consumer PCs – an increase of 2.5 percentage points year-on-year in each case.

                                Y/Y PC volume growth: WE distribution

London, 18 February 2019 – Trends that characterized Western European PC distribution during 2018 are continuing in the first weeks of 2019, with good demand from commercial buyers offset by weaker consumer sales, according to the latest distribution data published by CONTEXT, the IT market intelligence company.   

Volume sales of commercial PCs were up by +5% year-on-year in January following year-on-year growth in each quarter of 2018. Although desktop sales were down by a small -1%, there was positive performance across most commercial categories: desktop workstations increased by +3%, notebook volumes were up by +8 % and notebook workstations were up by +16%. As in 2018, ultra-slim notebooks, characteried by a z-height of less than 18 mm, were strong growth drivers in the portable segment with sales rising by +50%, to give these models a 22% share of the  commercial notebook market.

On the other hand, sales of consumer PCs were weak with volumes falling by another -5% in January this year following quarterly year-on-year declines throughout 2018. Although the growth in some segments – including ultra-slim notebooks and Chromebooks – that was seen in 2018 continued, it was not strong enough to reverse the overall negative trend.

It is expected that commercial sales will remain the stronger in 2019 as Windows 10 refreshes continue and companies focus on improving security and implementing modern workplace solutions. However, while demand should stay healthy, the current Intel processor supply constraints are expected to have an impact on sell-through during the first half of 2019, although the extent of this will vary by country and vendor.

London, 27 May 2019 - Sales of desktop monitors grew by over +11% year-on-year in April 2019 with mainstream consumer and high-end business models as the main driving forces, according to the latest distribution data published by CONTEXT, the technology market intelligence company.

After increasing sales of premium consumer monitors across Q4 2018 and Q1 2019, and a big push of low-end business models, distributors in West Europe (WE) are starting to see consumers shift back towards mainstream models costing €100–200 and more sales of high-end (above €350) devices to business.

Sales of premium business monitors have accelerated thanks to growing interest in larger models with screens that are 31.5" and above, and sales of those with even larger screens (34″ plus) have more than doubled. However, over 30% of more expensive monitors sold are still 27". A growing number of 49" models have helped to draw customers’ attention to a new generation of large displays and, as a result, have spurred sales of premium business models. Average selling prices (ASPs) have also continued to decline, with those for 34" monitors dropping over 12% in April to €516, which is less than the ASP for professional 31.5" monitors (€602).

As for monitors aimed at consumers, increased sales and revenues have been generated by demand for models with the specs needed for gaming or creative work such as high refresh rates.  While the dominant screen size for mainstream consumer monitors remains 21.5", sales are in decline as interest in 23.8" and 27" monitors increases – sales of these grew by over 30% in April. The fall in price of larger 31.5" monitors (to mid-range level, that is, below €200) supported +54% year-on-year growth in sales, especially of those with short 1ms response times and high refresh rates (>100 Hz). The price of 75 Hz monitors has fallen to €108; since this is the same as that 60 Hz models, sales of the faster monitors more than doubled in April 2019 and are expected to continue to grow.

Another strong month for consumer and business monitors suggests that this category will remain relatively strong in WE distribution throughout 2019: growing interest in premium monitors with increased screen real-estate should compensate for declining ASPs and help maintain high revenues.

        Consumer monitors (€100–200) – unit share by refresh rate: WE distribution

London, 29 April 2019 - Unit sales of large-format displays (LFDs) in West Europe (WE) continued to grow in Q1 2019 – by almost +14% year-on-year – driven by all sub-segments, including videowalls and high-brightness displays, according to the latest distribution data published by CONTEXT, the IT market intelligence company.

Sales of high-resolution LFDs more than doubled in the first three months of 2019, managing to offset the continuing decline in sales of full HD (FHD) displays (-11% in this quarter) sufficiently to lead to an overall +14% year-on-year volume increase in WE. While FHD remains the dominant resolution, a constant demand for the best picture quality, to enhance customer experience both indoors and outdoors, makes higher resolution displays much more attractive. Moreover, prices for ultra-high definition (UHD) displays are falling, helping to spur sales: in Q1 2019 the average selling price (ASP) of 4K/UHD non-touch displays in distribution was 1500 euro, almost 30% less than a year ago, and the ASPs of the most popular screen sizes, such as 55 inch and 65 inch, are already below 1200 euro.

The other type of LFDs seeing growing sales are those with high brightness. Previously, most LFDs sold by WE distributors had a brightness of less than 500 nits, but sales of these grew only 7% year-on-year in Q1 2019 while sales of LFDs with brightness of 1000 nits grew by over +75%. Revenues generated by these models were also up, by over +25% year-on-year, while those from displays with lower brightness declined by -4%. In the last couple of quarters, significant growth in sales of high brightness displays has been seen particularly for LG.

Interest in videowalls also remains high. For the second quarter in a row WE distribution has seen growing sales, generating revenues that are +4% higher than in the same period last year. A range of sizes, resolutions and technologies gives videowall solutions the flexibility to provide the highest levels of customer engagement, and help ensure the message is impactful and memorable. Customers are happy with 55-inch screens, and this remains the most popular size; however, there is increasing interest in smaller and cheaper 49-inch screens.

The rise of high-resolution and high-brightness displays described above demonstrates a growing interest in outdoor solutions for a range of purposes, such as smart cities. And, nowadays, these cannot be driven only by consumer experience – they need to evolve in line with technical, physical and environmental changes. We should therefore expect to see smarter and greener digital signage solutions in the coming years. 

                  UHD and FHD large-format displays – ASP evolution in WE distribution

London, 25 February 2019 - Sales of printer hardware through distributors in Western Europe (WE) were flat at -0.1% year-on-year in Q4 2018, mainly driven by the negative performance registered in December, which was a short month due to the Christmas holidays, according to the latest distribution data published by CONTEXT, the IT market intelligence company.

Laser devices reversed the trend seen earlier in the year by outperforming inkjet devices, and sales of consumer-targeted devices increased by +8.5%. Consumer printers steadily increased their market share and drove overall imaging growth in 2018.

Sales of multifunction printers (MFPs) were up by +2.2% year-on-year with continued growth for both laser and inkjet MFPs (sales were up by +4.1% and +1.7%, respectively). However, this was offset by the negative performance of single-function printers (SFPs) of which sales were down by -10.1% (-20.6% for inkjet SFPs and -7.2% for laser SFPs). This pattern confirms that the shift from single- to multifunction devices is continuing and is likely to be further consolidated going forward, particularly for lower spec models for which there is not a high demand from resellers, according to an UK Distributor (which has also informed that they are frequently asked if they can secure high volume, low spec, low price for export).

Sales of inkjet MFPs were better than during the same period in 2017. Monochrome and A3 MFPs were still driving inkjet growth with sales +42.2% and +13.8% higher than the previous year. Entry-level ranges (priced up to €400) continued to lead sales of consumer-targeted MFPs, accounting for 99.8% of units and generating €91 million. Sales in the higher price bands of this range also grew significantly, up by +38.8% for printers costing €150–200, +68.1% for those costing €200–300 and +40.7% for devices priced at €300–400. Sales of mid-level printers saw a double-digit increase in the €500–600 price band, which grew by +49.7% year-on-year.

Laser MFP volume sales were up by +4.1% in Q4 2018 driven by the exceptional performance of consumer-targeted devices (sales up by +111.6%), primarily because the ASP is continuing to decrease. The business-targeted models, which account for 72.1% of laser MFP sales and 89.4% of revenue, registered a sales drop of -13.2%, mainly because the ASP is continuing to increase, and which suggests businesses are replacing entry-level business-targeted models with mid and high-level consumer-targeted devices.

2018 saw the print industry continue to face the stark realities of digital disruption, however, sales of multifunction printers (MFPs) were up by +1.2% year-on-year in 2018 with continued growth for both laser and inkjet MFPs in 2018 (sales were up by +3% and +0.9%, respectively), which does not show a noticeable shift in sales towards the Managed Print Services (MPS). Nevertheless, according to the distribution channel, more and more resellers are looking at complimenting their offering by having an MPS proposition (partnering with vendors directly or indirectly, or through MPS dealers to support their business). However, vendors still need to expand their security assessment and monitoring services, along with partnering with traditional IT security providers, particularly in the area of threat intelligence to ensure that print security is treated with the same priority as the rest of the IT infrastructure. Print and digital convergence will drive increased demand for integrated document workflow in 2019, and despite the rapid adoption of digital and mobile technologies, many businesses remain reliant on print to some extent.

           Graph 1: Imaging unit sales and Y/Y change by category – WE distribution

Imaging sales and revenues grew in a few WE countries in Q4 2018, particularly in the United Kingdom which registered a double-digit increase in sales spread across nearly all categories (inkjet SFPs were the exception) and driven by the vendors which account for 83.2% of the British market: HP (sales up +68.3% year-on-year), Kyocera (+44.8%), Brother (+35.3%), Xerox (+24.6%), Lexmark (+18.6%) and Canon (+14.8%). Italy was one of the only other countries that saw growth in nearly every category (inkjet SFPs were again the exception) and there were strong performances from Samsung which changed its go to market strategy from resellers to distributors (sales up +109% year-on-year), Canon (+9.6%), Xerox (+7.7%) and HP (+7.4%), which share over 68.3% of the country’s printer market. 

But it was Belgium that registered the highest growth over this period – in terms of both units sold (up +32.7% year-on-year) and revenue (+29.1%) – with the increase driven by the three companies that dominate the country’s printer market and together hold a share of over 74%: Epson (sales up +140.6%), Samsung (+107.4%) and HP (+10.6%).

Norway saw revenue increase by +11.9% even though volumes were down by -11.5% year-on-year. This can be attributed to the increased number of sales in the mid- and high-level ranges (€800–900, €900–1000, €1200–1300, €1900–2100 and €2600–3100 price bands), which registered a three-digit increase overall (+115.9%).

Graph 2:  Y/Y change in imaging units sold through distributors by country – Top 5 WE countries 

Table 1:  Y/Y change in imaging units sold and revenue (Q4 2018) – WE distribution 

London, 14 December 2018 - Sales of printer hardware through distributors in Western Europe (WE) during October 2018 (early Q4) were up by +8.4% year-on-year, reversing the trend for the year so far, according to the latest distribution data published by CONTEXT, the IT market intelligence company.

Inkjet devices continued to outperform laser devices and sales of consumer-targeted inkjets increased. In fact, sales of consumer printers in October 2018 continued to drive overall imaging growth, although a double-digit decline in sales of business-targeted models, which were down by -12%, helped.

Sales of multifunction printers (MFPs) were up by +12.8% year-on-year in early Q4 2018 with both inkjet and laser MFPs continuing to see good growth (sales were up by +14.3% and +6.7%, respectively). However, this growth was offset by the negative performance of single-function printers (SFPs): sales were down by -10.5% year-on-year overall and -30.3% for inkjet SFPs. This pattern confirms that the shift from single- to multifunction devices continues.

Sales of inkjet MFPs were better in early Q4 2018 than in the same period of 2017. Monochrome and A3 MFPs were still driving growth with sales increasing by +98.2% and +18.2% compared to October last year. Entry-level ranges (priced up to €400) continued to lead sales of consumer-targeted MFPs, accounting for 99.9% of units and generating €44.8 million. There were also significant increases in growth in the higher price bands at this level:  +77.8% for €150–200 printers, +98.8% for those costing €200–300 and +91% for devices priced at €300–400. However, the greatest increase was in the €500–600 price band, which grew by 106.2% year-on-year.

Laser MFP volume sales were almost the same in October 2018 as in October 2017. The exceptional performance of consumer-targeted devices (sales up by +187.7%) was offset by a drop of -17% for the business-targeted models that account for 68.9% of laser MFP sales – 87.2% in terms of revenue.

During October 2018, in contrast to Q3, imaging sales and revenues grew in several WE countries, particularly Italy and the UK where double-digit increases in sales led to increases in revenue. Italy was also one of the only countries where there was growth in nearly every category (inkjet SFPs were the exception) driven by the strong performance of Samsung (up +144.1% year-on-year), Canon (+38.1%) and HP (+29.5%), which share over 74.6% of the country’s printer market. The increase in the United Kingdom was driven by the vendors which account for 82.9% of the British market: HP (+75.5%), Canon (+30.8%) and Brother (+28.2%). But it was Belgium that registered the highest growth in October 2018 – in terms of both units sold (up +56.9% year-on-year) and revenue (+48.5%) – with the increase again driven by the three companies that dominate the country’s printer market: Epson (sales up +234.9% year-on-year), Canon (+51.9%) and HP (+34.8%) together hold a share of over 91.9%.

                    Imaging unit sales and Y/Y change by category – WE distribution

               Figure:1 Y/Y change in imaging units sold through distributors by country -

                                                           Top 5 WE countries

                Figure 2: Y/Y change in imaging units sold and revenue - WE distribution

London, 20 May 2019 – Combined revenues from server computing products sold to enterprise customers through the West Europe IT distribution channel in the first quarter of 2019 were -7.1% lower than over the same period last year according to the latest data published by CONTEXT, the technology market intelligence company. The product segments grouped in this meta-category are preconfigured server systems, random access memory (RAM), processors, hard-disk drives (HDDs) and solid-state disks (SSDs). The decline was driven by a number of trends, among them an ongoing replacement of HDDs with SSD upgrades. 

However, when looking at sales of preconfigured server systems, which have over 40% of revenue share, we can see that the number of units has generally followed a downward trend (with the exception of Q4 2018). On the other hand, revenues have increased year-on-year. This is a consequence of higher component costs – initially for RAM and SSD, then for processors too. The exception here was Q1 2019, when there was a decline in revenues for server systems that was almost in line with the decline in units.

                           Server systems sold through WE distribution

Looking at other revenue drivers, we can see that more and more products have been customised before reaching partners. Two years ago, the ratio of revenue from built-to-order server systems to that from off-the-shelf systems was only 54:46. The share changed over time, with built-to-order systems accounting for more than two-thirds of revenue in Q3 2018, although this has since settled to a 64:36 ratio in Q1 2019.

                       Server systems: revenue share by build type

Systems that were built to order enjoyed year-on-year growth throughout 2018, and maintained almost flat growth of +0.3% in Q1 2019. This is in contrast to off-the-shelf products, which have seen a continuous and increasing decline over the past three quarters.

                              Server systems:  Y/Y revenue growth by build type

This would suggest the distribution channel has become increasingly accommodating – providing a greater number of customised products to their partners and customers. This, in turn, may be enabling partners to concentrate on providing other services to their customers.

London, 18 April 2019 – Revenues from network-attached storage (NAS) systems sold by West Europe IT distributors in the first two months of 2019 were +7.4% higher than over the same period last year according to the latest data published by CONTEXT, the IT market intelligence company. This growth was seen in revenues from NAS products designed for large enterprise customers, those aimed at small and medium business (SMB) customers, and products that can be used by either segment.

                                        NAS revenue: WE distribution

Although tower products saw the largest growth, with revenue up by +2737.7%, this is based on very small revenues in Jan–Feb 2018. Most of the increase came from sales of rack NAS systems: revenues from these grew by +19.3% year-on-year. This group’s performance was driven by sales of 1U and 2U racks, revenues from which were up by +22.3% and +18.5% respectively. Revenues from products whose form is not specified declined.

Desktop systems, which still make the biggest contribution to NAS revenues, have grown by +5.8% year-on-year.

              Desktop NAS system revenue share by number of bays: WE distribution

Since their introduction to the distribution channel in October 2017, products with only one bay have had a small but consistent share. However, so far this year the most widely adopted desktop systems have been those with two bays, closely followed by systems with four bays, both of which are designed for SMBs. These include Synology’s Disk Station, QNAP’s Turbo NAS TS and their latest addition, QNAP HS. Unsurprisingly, such products are largely sold through the consumer etail and small and medium reseller channels.

The continuing success of smaller desktop systems suggests that many SMBs have not been won over by the convenience of cloud storage but are instead choosing to store certain types of data locally.

The increase in revenues from rack systems, described above, shows that some larger businesses are also still investing in this type of storage. Despite some growth in the consumer etail channel, the corporate reseller channel has the largest revenue share and saw the greatest year-on-year growth.

Polymer INDUSTRIAL 3D-printer shipments up +18% year-on-year, led by growth from HP and Carbon; metal-focused INDUSTRIAL 3D-printer shipments up +30%, led by GE and EOS.

London, 24 October 2018 – On the heels of one of the largest general manufacturing shows in the world – September’s IMTS in Chicago -- and leading into one of the world’s most prominent additive-manufacturing trade events – November’s Formnext in September -- the INDUSTRIAL 3D-printer market finds itself on a good footing with shipments during the first half of the year up +22%. Shipments of INDUSTRIAL-class 3D printers which produce plastic/polymer components were +18% higher than a year ago, while those of INDUSTRIAL metal 3D printers were up +30% year-on-year.

Polymer-based 3D printers accounted for 68% of all INDUSTRIAL printers shipped during the first half of 2018, and the ongoing rise of shipments from HP and Carbon more than took up the slack from Stratasys which, although it remains the industry leader, continued to struggle. While Q2 was fantastic for 3D Systems, the leading publicly traded company in this market, most of its growth came from shipments of DESIGN and PROFESSIONAL printers. The company began shipping new products – including the much-anticipated Figure 4 systems – in Q3, so the second half of the year is expected to be strong. While most companies focused shipments on North America and Western Europe, UnionTech remained solid largely because of its focus on China.

     Chart 1: H1 2018 Global INDUSTRIAL polymer 3D-printer shipments by company

The period continued to see even stronger interest in and growing demand for metal INDUSTRIAL 3D printers, with shipments +30% higher than a year ago. All major vendors witnessed growth with EOS and GE Additive as joint leaders by market share. While they did not ship in bulk in the first half of the year, Desktop Metal has now begun supplying their lower-priced Studio system; with a strong and growing backlog of orders, this company is expected to enter the global Top 5 before the end of the year. Having just introduced its Metal Jet technology to the world, HP will also join leaders EOS, GE Additive, SLM, 3D Systems, TRUMPF and Renishaw in the years to come. HP will enter the metals side of industrial 3D printing in a slow and methodical fashion and the full market impact is not expected to be clear before 2020. Like Desktop Metal’s first product (as well as its larger and more exciting Production System which is set to hit the market next year) HP’s Metal Jet focuses on mainstream manufacturing across all sectors, rather than just the aerospace, automotive and medical industries where metal 3D printing already thrives.

       Chart 2: H1 2018 Global INDUSTRIAL metal 3D-printer shipments by company

INDUSTRIAL-class models are not the only 3D printers on the market: many of the companies mentioned above also offer DESIGN and PROFESSIONAL printers, and there is an almost entirely different set of vendors that sell PERSONAL 3D Printers. However, INDUSTRIAL 3D-printer shipments represented 70% of total printer revenues in H1 2018. “The INDUSTRIAL class of 3D printers is currently the most closely monitored, due to its ability to disrupt the $12T global manufacturing industry,” notes Chris Connery, VP for Global Analysis at CONTEXT.

* 3D-printer segment by ASP: INDUSTRIAL ≥ $100K, DESIGN = $20K–$100K, PROFESSIONAL = $2.5K–$20K, PERSONAL ≤ $2.5K

London, 19 July 2018 – Shipments of Personal/Desktop 3D printers saw their first ever year-on-year drop in Q1 2018 with 3% fewer printers shipping globally than in Q1 2017. Conversely, the Industrial/Professional segment saw its third consecutive quarter of year-on-year growth with printer shipments up +14%. While low-priced Personal/Desktop 3D printers are of interest to many, the Industrial/Professional segment - which accounts for 81%+ of all global printer revenues - is the one most closely monitored and the one with the strongest links to overall market health.

  Chart 1: Global 3D-printer unit shipments and growth by legacy application category

When grouped by class and segmented strictly by selling price, the biggest weakness can be seen in the Professional 3D printer class, shipments of which were down -21% year-on-year after 112% growth in 2017.

In recent years, many 3D-printing stalwarts have largely abandoned this Professional class, but it gained traction in 2017. This is due to start-ups, who had previously focused mostly on Personal 3D printing for consumers, hobbyists and education, beginning to recognize the growing demand in this more price-inelastic segment.

The Personal class of 3D printers, in which shipments were mostly flat year–on-year, is a bit more of a concern for the industry. Sub-$2,500 printers have seen great growth in recent years and sell well in education, hobbyist and even professional markets – unfettered growth in the sales of these low-priced printers has continued in spite of the lack of a true “consumer” market base. In recent years, crowdsourcing platforms (e.g. Kickstarter, Indiegogo, etc.) have been a barometer for demand but, over the last few quarters, they have offered few innovations in Personal 3D-printer products results in fewer-and-fewer successful campaigns.

                         Chart 2: Global 3D-printer unit shipments and growth by class

While the unit volumes associated with the Personal (and even Professional and Design) class of printers continue to catch the interest of many casual observers, the market is still very much driven by the Industrial class which accounted for 69% of global printer revenues in Q1 2018.

Printers in this class are most poised for market disruption in that they are able to move the market from its prototyping roots to one also focused on serial production, and shipments were up a healthy +20% year-on-year. This class is largely segmented into polymers/plastics printers and metals printers. Market leaders in Industrial polymer 3D printer shipments in Q1’18 included Stratasys, Union Tech, HP, Carbon and 3D Systems with impressive growth seen from HP, Carbon and 3D Systems. Leaders in unit shipments for metals 3D printers for the period included EOS, GE Additive, SLM Solutions, 3D Systems and Renishaw.

* 3D-printer segment by ASP: INDUSTRIAL = >$100K, DESIGN = $20K–$100K, PROFESSIONAL = $2.5K–$20K, PERSONAL = < $2.5K