• IT Supply Chain Insights - June 2019

Welcome to this months IT Supply Chain Insights. This monthly newsletter keeps you up to date with market trends and IT channel news giving you the knowledge you need to buy IT for less.

Get extra insight by video, from our Supply Chain Director.

 

Executive Summary

 

22,492

The largest number of price increases happened on the 2nd May, with 22,492.Jump to Monthly Stats

May was another mixed month for the IT channel. Smartphone sales and volume production, semiconductor revenue, and PC and printer shipments were in decline. Conversely, wearables posted big YoY growth, notebooks held steady, gaming monitors were on the up, and SSD prices dropped in response to rising adoption rates.

 

 

Exchange Rate

 

After dropping from 0.8593 on May 1 to 0.8499 by May 4-5, the euro had a positive month against the pound. It rose steadily to 0.8768 by May 18 and continued after a small plateau, hitting 0.8823 by May 24 and 0.8840 by May 31.

The euro had a more turbulent month against the dollar. Starting at 1.222 on May 1 and falling to 1.1177 by May 3, it recovered, rising to 1.1232 by May 10. After a dip, it hit a high of 1.1234 by May 13, and then crashed to 1.1155 by May 18. It began a rally on May 23, reaching 1.1202 by May 26, but then began a rapid collapse on May 27, falling to the month’s low of 1.1134 on May 30 and ending the month at 1.1151.

Eurozone inflation fell to 1.2% in May from 1.7% in April and unemployment hit a 10-year low in April at 7.6%. Meanwhile, manufacturing activity lowered for a fourth consecutive month, with PMI dropping to 47.7 in May from 47.9 in April.

Price Changes and News Through May 2019

Phones and Tablets

Global smartphone sales to end users dropped 2.7% YoY in Q1 to 373m units, Gartner reported. Samsung topped the list despite its 8.8% YoY drop to 71.62m units, ahead of Huawei (58.43m), Apple (-17.6% to 44.56m), OPPO (29.6m) and Vivo (27.36m).

IDC said global smartphone volumes were down 6.6% YoY to 310.8m units shipped in Q1, registering the industry’s sixth quarterly decline. Despite dropping 8.1% YoY, Samsung topped the Q1 vendor list with 71.9m units shipped and 23.1% market share, ahead of Huawei (+50.3% to 59.1m and 19%), Apple (-30.2% to 36.4m and 11.7%), Xiaomi (-10.2% to 25m and 8%) and vivo (+24% to 23.2m and 7.5%).

TrendForce noted a 9% YoY drop in Q1 smartphone volume production to 311m units. By vendor, Samsung held on to the top spot with 23.3% market share, ahead of Huawei (19.5%), Apple (13.3%) OPPO (8.6%) and Xiaomi (7.9%). Looking ahead, TrendForce said production will drop 3.7% YoY in 2019 to 1.4bn units.

According to IDC, global smartphone shipments will fall 1.9% YoY in 2019 on the back of an expected 5.5% YoY drop in 1H shipments. A more positive 2H is looming on the back of 5G handset demand. The report also said Android will increase its market share to 86.7% in 2019, up 1.6% YoY and continue to grow 2.1% to 1.32bn units by 2023. Average Android selling prices are expected to grow 5.8% YoY in 2019 to US$269. Apple on the other hand is expected to face a 12.1% YoY decline to 183.5m units shipped.

Traditional PCs

Global notebook shipments dropped just 0.8% YoY in Q1 to 36.97m units, TrendForce reported. By vendor, HP topped the list for the 12th consecutive quarter with 2.6% YoY growth to 9.23m units and 25% market share, ahead of Dell, Lenovo, Apple, Asus and Acer. Looking ahead, TrendForce said notebooks could enjoy a 10% YoY shipment growth in Q2, though only HP and Apple will register growth.

According to IDC, total shipments of traditional PCs including desktops, notebooks and workstations to the EMEA region will drop just 0.4% YoY in 2019 to 71.3m units. Further ahead, the market will drop a further 1.5% YoY to 67.22m by 2023, it predicted.

In tablet news, Digitimes said global Q1 shipments fell 12.9% QoQ but were up 13.8% YoY to 37.15m units. Meanwhile, ChannelNews It also said Q2 global tablet shipments will fall 8.7% YoY.

Premium Ultramobiles & Wearables

According to IDC, global wearable device shipments grew 55.2% YoY in Q1 to 49.6m units. Wrist-worn devices lead the market with 63.2% share, while ear-worn grew the fastest at 135.1% and accounted for 34.6% of all shipments. Apple topped the vendor list with 12.8m units, up 49.5% YoY, ahead of Xiaomi with +68.2% to 6.6m units, Huawei (+282.2% to 5m), Samsung (+151.6% to 4.3m) and Fitbit (+35.7% to 2.9m units)..

Processors, MEMs, Semiconductors

IDC warned that global semiconductor revenue will decline for the first time in years, falling 7.2% YoY to $440bn in 2019. IHS predicted slightly worse, forecasting a 7.4% YoY decrease in 2019 revenue to $446.2b. It’s not all bad though, IDC said, noting the market will recover in 2020 and grow at 2% YoY to $524bn by 2023.

Memory

According to TrendForce, Q1 DRAM prices and volumes dropped with supplier revenue down 28.6% QoQ, due to a mixture of last year’s increase in production capacity and reduced demand as companies cleared out their own inventories. It warned that prices will continue to fall in Q2.

TrendForce noted NAND Flash revenue fell 23.8% in Q1 QoQ and will continue to fall into Q2. By manufacturer, Samsung topped the revenue list with $3.22bn, down 25% QoQ, followed by Toshiba (-20.2% to $2.18bn), Micron (-18.5% to 1.77bn), WDC (-25.9% to $1.61bn) and SKY Hynix (-35.5% to $1.02bn).

Meanwhile, next-gen memory such as MRAM, PRAM and RRAM are set to enter the market in 2020 with datacentres to be early adopters of the new technology.

Storage

According to TrendForce, SSD prices will hit a record low by the end of 2019 with 512GB and 1TB prices to fall below US$0.1 per GB. The report further noted that SSDs reached 50% market saturation in 2018 and will continue to see SSD adoption grow to 60-65%, with 512GB SSDs to replace 128GB as the mainstream, second only to 256GB SSDs..

Displays

Global TV panel shipments enjoyed 4.2% YoY growth in Q1 to 70.02m units, TrendForce reported. By supplier, BOE topped the list ahead of LG, Innolux, CSOT and Samsung. The report also noted China’s top three suppliers accounted for over 40% of the market.

Gaming monitors grew 112% YoY to 5.4m units in 2018 and are expected to reach 7.9m units in 2019, up 46% YoY, TrendForce reported. ASUS topped the list ahead of Acer, Samsung, AOC/Phillips and Micro-Star.

Context said Western Europe’s desktop monitor sales grew 11% YoY in April on the back of strong mainstream consumer and premium business model sales. The report noted a rise in interest in 31.5” models, and that average selling prices are dropping, with 34” alone down 12% to below the average price of 31.5” monitors.

In other news, IHS said the trade war between the US and China is resulting in a drop in Q2 panel demand. South Korean makers will see a 3% QoQ volume decline to 17.3m units, while Chinese brands expect a 13% QoQ drop but grew 5% YoY in Q1 to 20.6m units.

Printers

Global printer shipments dropped 3.9% YoY in Q1 to 22.8m units, IDC reported. HP topped the vendor list with 9.36m units, down 3.5% YoY but still holding on to 41% market share. Canon came in second (-1% to 4.34m) ahead of Epson (-2.8% to 4.31m), Brother (-6.3% to 1.67m) and Kyocera (-2.6% to 0.53m). Segment highlights included ink tank devices growing 23.4% YoY, inkjet shipments dropping 2.1% YoY to 13.7m and A3 color laser multifunction printer (MFP) shipments up 1% to 0.6m units.

Printer shipments to Western Europe dropped 5.8% YoY in Q1 to 4.6m units with market value also down 4.1% YoY to $2.5b, IDC said. In the UK printer shipments fell 4.1% YoY to 0.78m units.

Context said Western Europe’s printer sales declined 4.2% YoY in Q1, while MFPs fell 1.7% YoY and single-function printers fell 13.6% YoY. In the UK, printer shipments fell 6.2% YoY with revenue down 7.3% YoY.

Monthly Stats

New products started at 27, dropped to 8 on May 3-5, recovered, rose from 32 on May 13 to a high of 1,698 on May 14, fell and hit a low of 1 by May 28 before ending the month at 25.

HP topped both price increase and price reduction by manufacturer.

Total price increase started at 10,946, jumped to 22,492 on May 2, dropped to a low of 4,388 on May 3-5, hit 34,489 on May 6, fell, recovered and held steady at 34,580 on May 17-19, before rising to a high of 53,859 by May 20, only to fall and end the month up from where it started at 12,263.

Price decreases started at a monthly high of 31,156, hitting a low of 3,017 by May 17-19 and ending down at 13,215 on May 31.

Stock up started at 3,445 and jumped to a high of 8,790 on May 3-5 before falling to a low of a 384 on May 7 and then coasting through to end the month at 4,102.

Stock down started at 17,408, falling to a low of 7,889 by May 7, recovering and holding steady before a quick dip and rebound, ending the month at 13,173.

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