Analysis

European electronic components market trends - Q3 2017

21st November 2017
Joe Bush
0

The European electronic components markets saw continued growth in Q3 2017, bucking the historical trend of third quarter decline. Further analysis of the data provided IDEA (International Distributors of Electronics Association) indicates that the pace of growth in Europe slowed down in Q3 2017 but the decline was not nearly as quick as in recent history.

 

Lead times quoted by manufacturers remain extended as demand for electronic components continues to outpace forecast demand: “Indications are that progress will continue into Q4 2017 and beyond into 2018,” commented IDEA Chairman Adam Fletcher. “If this happens it will mark one of the longest periods of sustained growth for over a decade.”

Electronic market trends Q3 2017

The table above shows that whilst billings (sales revenue invoiced, less credits) growth has been pretty consistent across the first three quarters of 2017, bookings (net new orders entered) continued to decline, which is odd considering the extended manufacturer lead times we're currently experiencing. The book-to-bill (B2B) ratio also declined in Q3 2017 - 1.09:1 down to 1.04:1 - suggesting that billings growth will probably follow suit into Q4: “All three metrics are important and the link between them is obvious,” Fletcher said, “but the billings number is the critical value. Market analysts, shareholders and competitors closely monitor this number as it reveals the actual sales revenue performance of all organisations reported within the market.”

Electronic market trends Q3 2017

 The table above compares total electronic components bookings (net new orders entered) by each country in Europe in Q3 2017 and contrasts and compares the results with the previous quarter's results and those achieved in the same period last year. The blue bar reveals that the French, Italian, Nordic, Swiss and Austrian components markets declined in Q3 2017 whilst growth continued in the UK and Germany, resulting in an average bookings decline of (2.6%). 

The light brown bar compares Q2 2017 with the same quarter last year and indicates that all European electronic components markets enjoyed strong bookings in the quarter, averaging out at 21% growth. The dark brown bar compares bookings achieved year to date (Y2D) with the same period 2016, revealing an average bookings growth rate of 18.4% over the 12 month period.

Electronic market trends Q3 2017

The chart above illustrates total electronic components billings (sales revenue invoiced, less credits) achieved in Europe in Q3 2017. The blue bar compares the quarter with the previous one and reveals that the French, Italian and Nordic region components markets declined in the period whilst the remaining four countries continued to grow.

Overall, the average change was a decline of (0.5%). The light brown bar compares Q2 2017 with the same quarter last year and shows that all European electronic components markets experienced strong billings growth in the quarter, achieving average growth of 16.1%. The dark brown bar compares the current year to date Billings with the same period 2016, revealing  an average billings growth rate over the 12 month period of 10.4%.

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