ARLINGTON, VA – Driven in part by the skyrocketing sales of connected devices, revenues for the consumer electronics (CE) industry are projected to grow 2% in 2014, reaching a record high of $211.3 billion, according to U.S. Consumer Electronics Sales and Forecasts 2010-2015.
Looking ahead to 2015, the report predicts that industry sales will grow by 1.2%, with industry revenues reaching another all-time high of $214 billion. The semi-annual industry report, released by the Consumer Electronics Association (CEA), is a consensus forecast reflecting U.S. factory sales-to-dealers and covers more than 100 CE products, serving as a benchmark for the CE industry, and charting the size and growth of underlying categories.
Emerging Category Growth
CEA’s forecast projects that revenues from emerging product categories will grow by 242% year-over-year in 2014, and another 108% in 2015. These developing technology categories include 3D printers, health and fitness devices, smart watches, Ultra HD television displays and smart thermostats, a newly-introduced sales category to the report.
Cumulatively, while the emerging product categories represent less than 3% of the entire CE industry revenue, they are expected to contribute almost $5 billion to the overall CE industry in 2014. That total is an astounding jump from just two years ago, when revenue from these categories was too small to track.
Video
Innovations within the television category will help drive sales this year, as consumers choose larger screen sizes and premium display features to upgrade their home video experience. Despite a steady decline in average wholesale prices, TV sales remain critical to the industry’s overall bottom line with total TV sets and displays projected to reach $18.4 billion in 2014, down 5% from 2013.
– Ultra HD: The continued market growth of Ultra HD TV is performing better than initially projected in 2014. Unit shipments of Ultra HD displays are expected to reach 800,000 in 2014, earning $1.9 billion in revenue, a 517% increase over the 2013 total. Revenue from Ultra HD displays is projected to exceed $5 billion in 2015, an impressive total considering that revenue was virtually nonexistent three years earlier.
– LCD flat panels: LCD TVs will account for 94% of all digital display sets sold this year, with 36.7 million units expected to ship to dealers in 2014. That total will produce $17.3 billion in revenue, in line with 2013 levels as the third-highest revenue driver to the CE industry.
Mobile Connected Devices
Sales of mobile connected devices, specifically smartphones and tablets, will continue to stand as the top two revenue drivers of the CE bottom line in 2014. These two devices alone will represent 35.1% of total CE industry revenue in 2014. Although revenue growth for this category has slowed, unit sales will continue to see increases.
– Smartphones: As the sales leader of the industry, smartphone unit shipments are projected to reach 163.5 million this year, up 8% from the 151 million units sold in 2013. Additionally, smartphone revenues are expected to generate $46 billion in 2014, a 7% increase from $43 billion in 2013.
– Tablets: Unit sales of tablets are projected to reach 80.4 million this year, a 4% increase from 77.4 million in 2013. Revenues for tablets will reach $25.6 billion this year, down 3%.
According to the report, other product categories expected to see positive growth this year include audio, with headphones, Bluetooth wireless speakers and soundbars remaining as the standout products of the category; automotive electronics, fuelled by the growth of new vehicle sales in 2014; and gaming consoles, spurred by the release of eighth-generation gaming consoles at the end of 2013.
