As expected, the June results of the Electronic Component Sales Trends (ECST) survey from the Electronic Components Industry Association (ECIA) showed only minor improvements from the disaster of sales sentiment from May.
Overall, sales only improved by four points between May and June following the 14.5 freefall between April and May. The June index score is still well below the average of last year at 76.3. ECIA said the hope is for July to improve eight points to 84.2.
Segments improve
Semiconductors, which dropped by more than nine points in both April and May, rebounded by nearly nine points in June. ECIA forecasts the July outlook will improve 10.4 points.
Passives are recovering but have a much longer path to recover after dropping a whopping 23.7 points in May. Electro-mechanical components remained flat in June but the outlook for July sees an improvement of more than five points. However, the overall trend in 2023 points to an extended market recovery period with a turnaround in year-over-year growth coming at the end of 2023 at the earliest, ECIA said.
Meanwhile, distributors and manufacturers had different views of the market. Both segments continue to deliver bearish inputs with overall index scores of 68 and 69, respectively. Manufacturers have an overall average of 99 in June with several component categories at or above 100. Survey results reveal that this is a divergent view of the world that started in April.
ECIA said a possible explanation is that manufacturers are seeing stronger performances in direct business while inventory balancing in the distribution channel continues to weigh on the distributors.
End market down
ECIA said the end-market index was essential flat between May and June, however it is forecast to lose two points between June and July while the overall component index improved by about eight points during the same time.
Three end-markets that typically have the strongest index numbers — avionics/military/space, automotive and industrial — had weaker results in the June survey. Still avionics/military/space had a score above 100. Every other segment is in deep red sale sentiment territory, ECIA said.
About the ECIA ECST report
The ECST survey provides highly valuable and detailed visibility on industry expectations in the near-term through the monthly and quarterly surveys. This “immediate” perspective is helpful to participants up and down the electronics components supply chain. In the long-term, ECIA shares in the optimism for the future as the continued introduction and market adoption of exciting innovative technologies should motivate both corporate and consumer demand for next-generation products over the long term.
The complete ECIA ECST report is delivered to all ECIA members as well as others who participate in the survey. All participants in the electronics component supply chain are invited and encouraged to participate in the report so they can see the highly valuable insights provided by the ECST report.
The monthly and quarterly ECST reports present data in detailed tables and figures with multiple perspectives and covering current sales expectations, sales outlook, product cancellations, product decommits and product lead times. The data is presented at a detailed level for six major electronic component categories, six semiconductor subcategories and eight end markets. Also, survey results are segmented by aggregated responses from manufacturers, distributors and manufacturer representatives.
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