According to the US Consumer Electronics Association Sales and Forecasts semi-annual industry report, mobile connected devices, including smartphones and tablets, continue to drive consumer electronics industry sales. The report also finds positive growth in segments within automotive technology, audio products and TV displays. The current report forecasts industry sales reaching US$202.6bn in 2013, compared to 2012 sales, with 0.2% growth. Looking ahead to 2014, industry sales growth is forecast to be 4.5%, with industry revenues reaching US$211.7bn.1
Despite a significant decline in unit shipments, revenue for the US television market is expected to remain flat in 2013 compared to 2012 as larger, higher-priced sets account for an expanded portion of sales. US television revenue is expected to amount to US$28.2bn in 2013, almost unchanged from US$28.1bn in 2012. Meanwhile, shipments this year are expected to decline by 4% to 36mn, down from 37.5mn in 2012.2
The digital camera market continues to put up a fight as the trend continues with point and shoots losing market share to smartphone cameras. To help reverse the revenue decline that many camera OEMs have experienced in the point and shoot market, many have turned their focus to mirrorless cameras with hopes to gain market share from an emerging type of camera that packs high-end features into a compact design. Like SLRs, these cameras come with large sensors and interchangeable lenses that produce high-quality images. In an otherwise stagnant camera market, hurt by competition from smartphones, demand for mirrorless models is driving growth for the DSLR market.2
Apple reported a decline in margins for a second consecutive quarter. The dip in margins is partly due to continued strong sales of the iPhone 4 and iPhone 4S, which have lower margins than the high-end iPhone 5. On the flip side, with vigorous promotion of the older iPhones the company has been able to increase its market share in the smartphone market in new and emerging markets.
Philips completed two divestments in the Home Healthcare Solutions business in Q2'13. The transactions involved an aggregate consideration of €100mn and resulted in a gain of €33mn.
Depreciation in the Yen this quarter vis-à-vis both the Euro and US Dollar led to higher import-based operating expenses for Japanese companies including Canon, Sony and Toshiba.
Consumer Electronics companies in the analysis reported lower revenues this quarter vis-à-vis the previous year. Slowing growth in emerging markets, moderate growth in the US, and sluggish growth in Europe led to overall lacklustre consumer spending. Net income also declined for the companies in our analysis except for Canon and Philips. Profit for Philips nearly doubled because of better operating results across all sectors, and lower restructuring and acquisition-related charges.