08/06/2015 //
Enough companies have now reported their 2Q’15 financials to allow a preliminary estimate of 2Q’15 vs.2Q’14 growth by sector of the world electronics supply chain. Based on partial data:
With this background Chart 5 shows the historical growth of electronic equipment by type and Chart 6 gives quarterly electronic equipment sales growth since 2001.
Chart 7 shows the electronic equipment business cycle on both an annualized (12/12) and 3-mont (3/12) growth basis. Under these current weak global economic conditions and without high volume growth drivers, the near future outlook appears to be for only modest electronics growth at best.
As a caution these second quarter growth estimates are based on still incomplete data and it is VERY likely that the values in Chart 3 will change as more companies report their 2Q’15 financial results.
Source: Company financials with Custer Consulting Group analysis
The combined revenues of six large North American based EMS companies declined 4.2% in 2Q’15 versus 2Q’14 and their aggregate net income dropped 42% On the brighter side their combined guidance is for 6.3% sequential growth in 3Q’15 versus 2Q’15.
Source: Company financials with Custer Consulting Group analysis
Based on the June “Durable Goods” report:
Stong www.census.gov/manufacturing/m3/index.html
Total North American PCB shipments increased 4.0% in June 2015 from June 2014, improving year-to-date shipment growth to -0.8%. Compared to the previous month, PCB shipments were up 18.7%.
PCB bookings grew 13.7% compared to June 2014, increasing year-to-date order growth to 3.6%. Orders were up 32.5% in June compared to the previous month.
"North American PCB sales exceeded last year's level in June for the first time this year, and order growth was the strongest it has been in eight months," said Sharon Starr, IPC's director of market research. "Strong orders have kept the book-to-bill ratio in positive territory for the past nine months," she added, "which is a good indicator of sales growth in the second half of this year."
Source: www.ipc.org
The worldwide tablet market declined 7.0% year over year in the second quarter of 2Q’15 with shipments totaling 44.7 million units according to preliminary data from IDC. Marked by little hardware innovation and limited vendor portfolio updates, the market also declined 3.9% compared to the first quarter of 2015.
"Beyond the decline, we're seeing a profound shift in the vendor landscape as the top two vendors, Apple and Samsung, lose share in the overall market," said Jean Philippe Bouchard, IDC Research Director for Tablets. "In the first quarter of the year, Apple and Samsung accounted for 45% of the market and this quarter, with the growth of vendors like LG, Huawei, and E FUN, their combined share dropped to 41%. Each of the growing vendors managed to address available pockets of growth in the market; connected tablets for LG and Huawei, larger tablets and 2-in-1s in the right price bands for E FUN. This trend is also something we see on a wider scale with the top five vendors accounting for 54% of the market, down from 58% last quarter. It is worth mentioning that Huawei enters the top five ranking for the first time, while E FUN has re-entered the top 10 after more than a year, further indicating that the vendor landscape is indeed evolving."
"Longer life cycles, increased competition from other categories such as larger smartphones, combined with the fact that end users can install the latest operating systems on their older tablets has stifled the initial enthusiasm for these devices in the consumer market," said Jitesh Ubrani, Senior Research Analyst, Worldwide Mobile Device Trackers. "But with newer form factors like 2-in-1s, and added productivity-enabling features like those highlighted in iOS9, vendors should be able to bring new vitality to a market that has lost its momentum."
Source: www.idc.com
China-based makers produced 761.788 million handsets in total during the first half of 2015, decreasing 4.5% on year, according to the Ministry of Industry and Information Technology (MIIT).
China-based makers produced 70.582 million color TVs in the period, increasing 2.7% on year, and 66.141 million units of the output were LCD models, growing 2.1%.
The first-half 2015 output of 145.031 million PCs slipped 11.7% on year, including 89.745 million notebooks which dropped 8.6%. They made 9.663 million digital cameras during the period, down 20.2%, said MIIT.
Source: www.digitimes.com
U.S. economic growth accelerated in the second quarter as solid consumer spending offset the drag from weak business spending on equipment, suggesting a steady momentum that could bring the Federal Reserve closer to hiking interest rates this year.
Gross domestic product expanded at a 2.3% annual rate, the Commerce Department said on Thursday. First-quarter GDP, previously reported to have shrunk at a 0.2% pace, was revised up to show it rising at a 0.6% rate.
The revision to first-quarter growth reflected steps taken by the government to refine the seasonal adjustment for some components of GDP, which economists said left residual seasonality in the data, as well as new source data.
Source: | www.bea.gov/national/ |
www.reuters.com |
Walt Custer is an industry analyst focused on the global electronics industry. Prior to forming Custer Consulting Group he was Vice President of Marketing and Sales for Morton Electronic Materials, a global supplier of specialty chemicals and process equipment for the PCB industry.
Custer has been a member of the IPC trade organization since 1975 where he received both the President's and the Raymond E. Pritchard Hall of Fame Awards. He is currently a member of the IPC Executive Market & Technology Steering Committee. Custer is also a Director of the EIPC European PCB trade organization.
He authors regular “Market Outlook” columns for Global SMT & Packaging magazine, the Journal of the HKPCA and the TTI MarketEYE website.