If you sell smartphones or smart home gadgets, the second half of 2022 is likely to be profitable. If you sell TVs, smart appliances, or laptops – maybe not such much. That’s the good news and the bad news according to CTA’s newly-released “U.S. Consumer Technology One-Year Industry Forecast.”
Overall, CTA projects that U.S. technology industry sales and shipments in 2022 will drop 0.2% ($1 billion) to $503 billion, down from last year’s record high growth of 11.6%. While 2022 sales and shipment volumes are projected to decline, revenue through 2023 is forecasted to remain above pre-pandemic levels.
“The industry has had two years of record sales behind it,” reports Rick Kowalski, CTA’s director of industry analysis and business intelligence. “We knew that some categories weren’t going to do as stellar as in 2022, so those spots we’re seeing challenges are sort of a snap-back to pre-pandemic levels.”
After two years of WFH consumers huddling at home around the electronic hearth, TV sales will be one category to snap back. CTA calculates that 39.4 million TVs worth $18.9 billion will be shipped in the U.S. this year versus the 46.5 million sets shipped and the $21.5 billion earned from them last year.
Now that folks are slowly returning to offices, laptop sales in the U.S., including both enterprise and consumer models, are predicted to decline 10% YoY to 68.9 million units in 2022, after a “stellar” 2021 during which 76.5 million laptops were shipped.
Potentially also taking a hit in 2022 are smart appliances, projected to decline 3% YoY to 9 million units, due both to lower consumer demand and to supply chain issues. “Manufacturers are having trouble getting parts, or parts at the value they need” for manufacturing, Kowalski says. Consumer demand for higher-priced smart appliances is likely impacted by “some of the volatility in the housing market,” according to Kowalski, thanks to higher mortgage interest rates and fewer housing starts.
On the positive side, CTA cites four areas of growth for the rest of the year:
- 5G smartphones are expected to account for 73% of all phones sold in the U.S. in 2022 compared to just 60% last year and are expected to account for 84% of units sold next year thanks to rapid expansion of 5G networks and older 3G networks being shut off, requiring many stubborn consumers to buy new phones. As usual, Apple’s pending new iPhone models due in the fall, along with their associated accessories, will likely prove to be a boon business in Q4.
- Gaming revenue is predicted to grow 1% YoY to $51.7 billion in 2022, and another 1% next year to $52.4 billion. According to the CTA report, “pent-up demand for next generation consoles remains strong and the growth of subscription gaming services provides a new source of recurring revenue.”
- Smart home hardware revenue is forecast for 3% growth in 2022, reaching $23.8 billion.
- Health tech revenues are projected to reach $13.4 billion, plus 4% YoY, prompted by both the pandemic trend of consumers adopting new health tech as well as continued growth of smarter, more feature-laden smartwatches and fitness trackers.
A copy of CTA’s full 2022 “U.S. Consumer Technology One-Year Industry Forecast” can be accessed or purchased here.