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CONTEXT Research Updates deliver timely insights on key market segments.

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

PC Research update


COVID-19-driven notebook momentum continues in Q2 2020

London, 03 Aug 2020 – The strong pandemic-related notebook momentum seen at the end of Q1 2020 carried on into Q2, according to the latest data published by CONTEXT, the IT market intelligence company.

Displays


Monitor demand remains strong as supply begins to recover

London, 10 July 2020 – Sales of monitors through distributors in Western Europe (WE) grew +14% year-on-year in the part of the second quarter of 2020 up to the first three weeks of June, according to the latest data published by CONTEXT, the IT market intelligence company.

Imaging


Distributors see boom in ink-tank printer sales during COVID-19 pandemic

London, 05 Aug 2020 – Western Europe’s distributors sold an unprecedented number of ink-tank printers in the second quarter of 2020, according to the latest data published by CONTEXT, the IT market intelligence company.

Enterprise


Coronavirus crisis increases sales of home networking products

London, 10 Aug 2020 – Sales of home networking products have been positively impacted by the COVID crisis in Europe with households updating their wireless equipment to enable working from home and improve web access for the whole family, according to the latest data published by CONTEXT, the IT market intelligence company.

3D Printing


COVID-19 concerns make 2020 3D printer sales outlook challenging; strong growth returning post-pandemic

A weak Q4 2019, now compounded by potential supply-and-demand constraints associated with the coronavirus pandemic, leave the global 3D printer market set to see fewer printers ship in 2020 than in 2019.




COVID-19-driven notebook momentum continues in Q2 2020

London, 03 Aug 2020 – The strong pandemic-related notebook momentum seen at the end of Q1 2020 carried on into Q2, according to the latest data published by CONTEXT, the IT market intelligence company.

Notebooks continued to see extraordinary growth across Western Europe’s largest distributors, with volumes up +55% in Q2 2020 compared to the same period last year. The Q2 rise was driven by Q1 order fulfilment as product supply improved, but also by newly received orders as demand for remote-working and -learning devices remained high in a quarter which began in a time of strict lockdowns and ended with the easing of the most restrictive measures. Notebook sales were strong across both the commercial and consumer segments, although commercial sales showed the stronger performance: business-targeted notebooks were up by +70.4% year-on-year while consumer systems grew by +38%.

The picture was entirely different for desktops: volumes in the category dropped by -27.8% year-on-year in Q2 2020, with commercial systems down -31.6% and consumer products -17.5%. OEMs across all Western European countries saw demand for the category dive, and distributors have been voicing strong concerns about the resulting rise in stock levels. Clearly, the pandemic has acted as an accelerator of the move towards mobile systems at the expense of stationary products. It should be noted, however, that commercial desktops faced a difficult year-on-year comparison in Q2 2020, with +17% growth one year ago as organisations prepared to migrate to Windows 10.

Looking at channel sales, consumer channels saw a dip in share of sales to retail stores following pandemic-related shop closures in March, to the benefit of sales to consumer etailers. Volumes of business-targeted notebooks to SMB resellers dropped sequentially in April while sales to consumer etail saw a rise, suggesting that some smaller companies moved to buy online when a number of small and medium resellers became inactive during the peak of the crisis.

The numbers are consistent with the challenges posed by the pandemic - including changes in demand and purchasing behaviour, the closing of shops, companies becoming temporarily inactive, and offices across the continent going remote. Notebooks have proved to be the form factor of choice; other IT equipment geared to facilitate remote working and homeschooling has also done well during the crisis, including monitors, accessories and communications software.

Moving into Q3 2020, portable demand is expected to stay healthy in a number of segments.There is however, a high level of uncertainty regarding the impact of the crisis on Western European economies, meaning that a lot of organisations will be very cautious when it comes to IT spending over the next few months.

Y/Y PC volume growth: Western European distribution



Q2 2020 Y/Y PC volume growth: Western European distribution




Monitor demand remains strong as supply begins to recover

London, 10 July 2020 – Sales of monitors through distributors in Western Europe (WE) grew +14% year-on-year in the part of the second quarter of 2020 up to the first three weeks of June, according to the latest data published by CONTEXT, the IT market intelligence company.

Strong consumer demand drove the increase as, under lockdown, individuals have been buying monitors for home offices, study environments, and gaming and leisure setups. Sales of consumer monitors have therefore soared: they were up +29% year-on-year in April, +39% in May and +43% in June. Sales of business monitors were below the 2019 level at the start of the quarter. However, this improved in the first three weeks of June (W23–25) when sales – primarily to small, medium and corporate resellers – were up +14% on last year.

Even while business-targeted monitors were struggling, distributors continued to work with their business-focused partners, sometimes selling them models usually aimed at consumers. Although this suggests that a monitor’s specifications and price bracket matter more to customers than whether it has been designated a business or consumer device, some of the shift was probably the result of limited supply.

Desktop monitors: Weekly unit sales by target customer, WE distribution





 

Strong demand in the second quarter coincided with low supply for many vendors as a result of the factory closures earlier in the year. In countries where demand was continuously very high, such as the UK, stock levels were down to only one or two weeks’ worth. This did not, however, have an adverse effect on the quarter’s results.

The same strong demand was seen across several of the major WE countries – Germany, Spain, and the UK – despite earlier concerns that the pandemic would soften spending. While unit sales for April and May were down year-on-year in France and Italy, there was a turnaround in June when both these countries showed strong year-on-year gains. Sales of cheaper monitors, particularly those retailing at less than 100 euro, helped the recovery. Indeed, there were growing sales of these lower-end models across WE, particularly to corporate resellers (+33% year-on-year). Sales to retail chains and business etailers also improved.

Desktop monitors: Weekly unit share by price band, WE distribution



Supply is expected to reach normal levels during Q3, and vendors should be able to respond to any extra demand from businesses that feel they can renew equipment for staff returning to offices as lockdowns ease. The coming quarter is traditionally weak because of holidays and, even though there will be less travelling this year, it would be unwise to be optimistic about the coming months. Vendors and distributors are also concerned about the extent to which demand may have peaked in the first and second quarters of 2020, affecting the second half of the year. There is much still to learn about the pandemic and what it means for people and their material needs.




Distributors see boom in ink-tank printer sales during COVID-19 pandemic

London, 05 Aug 2020 – Western Europe’s distributors sold an unprecedented number of ink-tank printers in the second quarter of 2020, according to the latest data published by CONTEXT, the IT market intelligence company.

The increase reflects the continued growth of a technology that is relatively new in Europe. Marketed as a smart investment that delivers long-term savings, ink-tank printers appeal to users wishing to equip their homes with durable hardware. Control measures associated with the pandemic have, therefore, created conditions that favour adoption of these devices. Price increases resulting from a shortage of traditional consumer inkjet printers, and shortages of ink cartridges, have also encouraged uptake of ink-tank models.

The steadily increasing market share and the strong upward month-by-month sales trend suggest that ink-tank printers may well end the year with a higher share than last year’s 4.9%. In the second quarter of 2020, the number of traditional ink-cartridge printers sold fell year-on-year while ink-tank sales saw dramatic increases.

Ink-tank printers accounted for 6.6% of sales of inkjet units sold in Western Europe in the first half of 2020 (up +2.3 pts compared to the same period last year), and for 15.7% of inkjet revenue, with sales of ink-tank printers through the distribution channel increasing by +59.8%. This overall figure disguises the details of the trend: unit sales climbed throughout the spring, with year-on-year growth rates climbing from -11.1% in January to +89.6% in June.

Graph 1: Printer volume sales: Y/Y change by category – WE distribution



The year-on-year performance of ink-tank printers in the major Western European markets exploded in the second quarter, coinciding with lockdowns. In the first quarter, the number of units sold in Germany was down by -30.3% on the previous year; in the second quarter they were up by +110.7%. In the UK, they moved from +19.4% in the first quarter to +142.5% in the second; and in Italy from +69.5% to +149.3%. There was also a change in unit sales in France: from -14.9% to +70.3%.

 

Graph 2: Ink-tank printer volume sales: Y/Y change by country – major WE economies
 



The geographical spread of ink-tank printer sales in Western Europe largely follows the size of the market in each country with four of the Top 5 heading the list. Germany took 25.2% of ink-tank sales, representing a fall from its even bigger share of 36.2% in the first six months of 2019. Italy followed with 19.3%; the UK took 13.7%; and Spain 11.2%. Whilst the UK’s share held steady, Italy and Spain both increased their shares compared with the same period last year. France took only 2.7% of sales compared with 3.7% in the first half of 2019 – a smaller share than the other major countries in both years.

The mix of brands is steadily diversifying as more vendors explore Europe’s potential. Epson, an early champion of the technology, took 79.2% of the market in the first half of 2020; 24.1% of its inkjet units were ink-tank models, and they provided 41% of its revenues for the category. Other major vendors are making inroads: HP’s and Canon’s shares of the ink-tank market increased in H1 2020 compared with the first half of 2019 (8.8% and 5.9% share respectively).

Although the pandemic has encouraged uptake, there are other positive indicators – a diversifying share of the market across countries and across vendors – suggesting that ink-tank models are poised to steadily replace traditional consumer inkjet printers in Western Europe.




Coronavirus crisis increases sales of home networking products

London, 10 Aug 2020 – Sales of home networking products have been positively impacted by the COVID crisis in Europe with households updating their wireless equipment to enable working from home and improve web access for the whole family, according to the latest data published by CONTEXT, the IT market intelligence company.



Growth in Q2 was driven by sales of extenders and mesh systems whilst there was a more moderate increase in router sales. This confirms that consumers have been looking for solutions to improve WiFi coverage in their home by eliminating dead spots rather than by updating core networking devices (such as routers).

Monthly Y/Y Revenue Growth



However, year-on-year sales of routers picked up in June, after only slow growth in April and May, and contributed to making June the strongest month of the quarter for this category. It shows that consumers who had prioritised increasing household WiFi coverage at the start of the crisis are looking at updating the main component of their network as the possibility of a longer time at home becomes more real. And, in doing so, they are prepared to make an investment in more expensive products: the average selling price for routers sold in June was higher than April and May.

Routers: Average Selling Price (Euro)



Looking at the product mix sold over Q2 2020 provides a partial explanation for this change. Spending at the beginning of the quarter was, for many households, an unplanned emergency response. In Italy – where home networking revenues grew by +60% year-on-year in Q2, the second top highest of any of the Top 5 European countries – mobile broadband router revenues grew by more than 200% in April when large numbers of cheap pocket routers were sold. This makes perfect sense: Italy has the cheapest mobile broadband contracts in Europe and consumers jumped on inexpensive mobile router options while taking advantage of these contracts at the start of the crisis. Another example of this trend is the relatively high volume sales of older WiFi-N extender products seen in April.

Italy Focus: Monthly Y/Y revenue growth



 

The improved performance of more traditional and more expensive routers in June, including DSL and cable modem routers, is good news for vendors who may have missed out on the first wave of home-network spending. Increasing sales of WiFi-6 standard devices, which now account for 5% of consumer router and extender revenues, is another positive signal of more value being added.

We have also heard that households are updating their broadband package, or even changing internet providers, in order to solve issues they faced during lockdown. With uncertainty about a second wave of COVID cases, and the possibilities of further lockdowns in Europe, the outlook for home networking is bright. Consumers are already looking at longer-term investment to handle the new normal, and the positive effect on revenues from home-networking devices should continue in the months to come.




COVID-19 concerns make 2020 3D printer sales outlook challenging; strong growth returning post-pandemic

A weak Q4 2019, now compounded by potential supply-and-demand constraints associated with the coronavirus pandemic, leave the global 3D printer market set to see fewer printers ship in 2020 than in 2019.

As of the end of Q1 2020, many 3D printer companies from the US, Europe, China and everywhere across the globe have rightly refocused their effort away from printer sales to producing much-needed supplies to help combat coronavirus, according to the latest data by CONTEXT, the market intelligence company.

Focusing efforts on producing much-needed medical supplies has meant a move away from the production and sale of printers towards service businesses and service-bureau infrastructure. Coming on the back of weak shipments in Q4 2019, this refocus – and the supply-and-demand constraints expected in the weeks to come – looks to make 2020 a difficult year for 3D printer shipments.

While COVID-19 had not yet had an impact, global 3D printer shipments were already unseasonably weak in Q4 2019. For many manufacturers – particularly those focused on Industrial* or Design* price-class printers – this slowdown was associated with a weak automotive market, a generally weak manufacturing sector and sluggish Asian and European economies.

CONTEXT notes that printer shipments over the quarter saw year-on-year changes of -11% (Personal* price-class printers), +26% (Professional* printers), -22% (Design) and -23% (Industrial); the only increase being in the hot Professional category.

Over the year as a whole, there was only +1% growth in shipments of Industrial printers compared to 2018; in the Design segment, -6% fewer printers shipped; and finished-good Personal printer shipments were down by -11% as demand continued to shift to kits, sales of which are hard to quantify. Once again, the only year-on-year growth was in the Professional segment where shipments rose by +16% as many longstanding 3D printer companies returned to the space and others, previously focused on producing Personal printers, moved up into it.

Chart 1: Yearly global finished-good 3D printer unit shipments and growth by price class (note two scales)

In the finished-good Personal 3D printer market, 2019 was strong for established vendors such as XYZPrinting, Prusa Research, Monoprice, Anycubic and Flashforge but it was the more ill-defined kits market which drew the most industry attention. The leader in the kits space - and far-and-away the market share leader in the global 3D printer market when considering both kits and finished-goods - was China’s Creality 3D. While it was once assumed that consumer demand for DIY kits would fade away in the face of the better out-of-the-box experience offered by completed machines, self-assembly – largely catering to hobbyists – has come back into vogue in recent years. This is thanks to not just very low price points but also protectionist measures which favour the importation of parts that can be assembled locally over finished goods even though, in this case, the assembly is on an individual do-it-yourself basis rather than factory-level production. The number of DIY kits shipped in 2019 was almost twice as high as that of finished printers but, if aggregated into the annual total, sales to this nebulous market would have increased global revenues by only +9%.

In the Design and Industrial segments – which collectively accounted for over 78% of all 3D printer sales revenue – aggregate shipments were down -3% for 2019. Although metal 3D printer shipments were up +4% on the previous year, with steady growth seen in emerging technologies like material extrusion and directed energy deposition, there was a -10% decline in those of mainstream powder bed fusion printers. Market leaders GE Additive and EOS were joined in the top 5 by Desktop Metal and Markforged (both of which offer material extrusion based solutions) and newcomer HBD which performed strongly in China, its domestic market. Overall shipments of Industrial and Design polymer printers fell by -5% compared to 2018 but certain vendors, including HP and UnionTech, saw excellent growth. Stratasys remained the market leader in terms of unit volumes even though annual shipments dropped by -12% in 2019.

Chart 2: 2019 Global 3D printer unit market share leaders: Industrial and Design price classes

Forecasts for 2020, based on information available as of 23 March, show printer manufacturers are now assessing, on a daily basis, the impacts of a disrupted supply chain and uneven human productivity on both their own ability to produce hardware and the end-markets to which they cater. In recent years, vendors have typically begun with a bullish outlook and slowly adjusted their shipment outlook over the year. Currently, however, vendors are offering only informal/high-level forecasts: most are beginning 2020 with a negative outlook and anticipating they will recover as business begins again once the global pandemic subsides. While each printer class caters to different users, many of the key end-markets (such as the dental, aerospace, automotive, consumer product, orthopedics and education markets) are negatively affected by global work closures and slow-downs. On the supply side, key components for printers, as for many other electronic goods, come from China, the region impacted first by the pandemic. As a result of the uncertainty, hardware vendors are now thinking in terms of weeks and quarters rather years, and current aggregate forecasts show the Industrial and Design segments are set to see shipment declines of -4% from 2019 to 2020 even taking into consideration a recovery in the 2nd half of the year.

In the Industrial market – which accounted for 68% of global 3D printer hardware revenues 2019 – shipments in the second half of 2019 were slow, even though this is usually the strongest part of the year, and the outlook for 2020 was, therefore, already challenging. Taking into account both these negative headwinds and the supply-and-demand challenges associated with global reactions to the coronavirus, this segment hopes to see a slide of only -2% in printer shipments in 2020 after its 5-year CAGR of +14% and anticipates a rolling recovery by region, starting with the East.

As the pandemic comes under control and economies return to normal, there is great potential for the 3D printer market since the ability of the technology to assist with the immediate needs of the medical community have showcased its quick-turn capabilities worldwide. Responses to the pandemic are also demonstrating that leveraging 3D printing for local production, instead of relying on complex multinational supply chains, has the potential to help many companies mitigate future risk.

                  Chart 3: Global Industrial 3D printer shipments and forecast

 

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