As the year end approaches, the push to bring sales sentiment for electronic components over the growth threshold of 100, indicating growth, has stalled in the month of November, according to the November Electronic Component Sales Trends (ECST) survey from the Electronic Components Industry Association (ECIA).
The stall is expected to continue into December as the outlook will only see minor improvement from November actuals, ECIA forecasts.
Following healthy improvement between May and August of this year, the index has wavered between 83 and 90 from August through December. While predictions of improved sales sentiment continued during these months, actual results showed the industry is still struggling to reach growth before the end of the year, ECIA said.
Among the three major component categories, connectors and memory chips have the most favorable outlook for December but all these segments will likely fall below 90 come the December actual results.
Looking ahead
The results of ECIA’s quarterly survey show encouraging results compared to the monthly November survey with the first quarter of 2024 showing positive sales growth for some participants — improving from 14% to 23% — while other participants expect negative growth in the 18% range in the first quarter of next year.
However, the net score between the two is a mostly positive outlook for Q1 2024. ECIA said it is the most positive since the second quarter of 2022.
No more disconnect
As the ECIA has been following since April, the disconnect between manufacturer representatives, manufacturers and distributors, which has been hard to identify, evaporated in the November survey for both the actual numbers and the December outlook.
The ECIA said this is one of the most encouraging developments in the November survey as it aligns these groups much more than they have been for the last eight months. Manufacturer representatives are the front lines in the sales efforts and an improving outlook from these vendors is a reason for optimism.
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.
Interested in reading the entire ECST report? Click here for more info.
