IT market researcher Context thinks that revenue growth for European IT distributors in 2022 will be 3.7 percent against the previous year.
Context claims the data is “even more significant” after two years of high growth during the pandemic and a miserable IMF GDP forecast which recently downgraded global growth from 4.4 percent to 3.2 percent for 2022.
Excluding telecoms, Context predicts 5.8 percent growth in Q4 2022, followed by a softening in successive quarters brought about by the recession and reduced backlogs.
The analyst firm explained its forecast is based on strengthening infrastructure and software and services, driven by business demand across servers, networking and storage.
Supply chain issues that impacted network and server components eased in Q3, although there are still long lead times for some networking products.
Context global managing director, Adam Simon said that hybrid working trends will continue to fuel demand for hardware, while growth will also come from IT infrastructure, and government investment in health and education, supported by the NextGenerationEU Covid relief fund.
“On the flip side, consumer demand has softened thanks to the surging cost of living, economic uncertainty and the spectre of recession – and will continue to do so into 2023.”
Context claims PC demand will remain muted due to slumping consumer confidence, with inflation pushing prices up.
It added businesses will also remain cautious, with demand for PCs likely to be pushed out, and no major government-backed education projects on the horizon.
Datacentres will see the greatest distribution growth of any sector over the next few months, and there’ll be major opportunities in security software and services. Infrastructure software will continue to provide a solid revenue stream for distributors with the skills and focus to take advantage.
Enterprise storage and server sales will perform as the server backlogs/improved component availability improves, and there is a continued strong business demand for storage.
Enterprise networking sales will benefit significantly from a loosening of supply chain constraints, especially in the enterprise switching space.
Hybrid working and digital transformation will also drive demand, although falling prices, depressed revenues and demanding YoY comparisons may limit growth.
