Consumer Electronics Sales Projected at $208 Billion in 2014

Consumer Electronics

Published: January 7, 2014 2:06 pm

Last Updated: April 27, 2020 7:29 pm

The Consumer Electronics Show (CES) opened today in Las Vegas and it is nothing if not big. It’s also a place for big announcements, and the Consumer Electronics Association (CEA) CEO Gary Shapiro did not disappoint. According to Shapiro, consumer purchases of electronics in 2014 will rise to a record high of $208 billion.

Some 65% of the industry’s growth will come from emerging device categories like 3D printers, smart watches, Ultra HD TV displays, and other new gizmos that total less than $3 billion in total sales, but drive the industry’s growth. Early adopters of consumer-targeted devices like the 3D printers from Stratasys Ltd. (NASDAQ: SSYS) and 3D Systems Inc. (NYSE: DDD) or wearables from companies like Samsung and Intel Corp. (NYSE: INTC) can make even a small increase in revenues look like a giant step forward for a new technology. We’ve already weighed in on the wearables campaign that Intel announced earlier this morning at CES.

The big money remains in smartphones, where Samsung and Apple Inc. (NASDAQ: AAPL) have wrapped up about two-thirds of the hardware market and an even bigger percentage of the operating system market. The CEA expects unit shipments to rise from 138 million units in 2013 to 152 million units this year and to generate $41 billion in revenues, a jump of nearly 4% over 2013 revenues of $39 billion.

Likewise, tablet sales are projected to rise 15% from 77.4 million units in 2013 to 89.3 million units. Revenues are expected to rise about 3% to $27.3 billion. Amazon.com Inc. (NASDAQ: AMZN), which has priced its Kindle Fire tablets very aggressively compared with Apple’s iPad, continues to add to its share in the still fast-growing tablet market.

Ultra HD TV made their first appearance at last year’s CES and are expected to generate more than $1 billion in revenues in 2014. Samsung’s 84-inch model sells for $25,000, while Sony Corp. (NYSE: SNE) offers a 65-inch model for a more modest $3,500. Not a huge market at these prices, but like all electronic gear, prices will drop fast as more competitors enter the fray.

One more CEA projection deserves notice. The association projects that new car sales in 2014 will drive $11 billion in factory-installed electronics gear in those new cars. That’s a rise of 20%. Satellite radio from Sirius XM Holdings Inc. (NASDAQ: SIRI) is installed on about 25% of all cars currently registered in the U.S. and the company expects to raise that above 40% in the next five years. Combined with the projection from the CEA, the recent buyout offer from Liberty Media Corp. (NASDAQ: LMCA) looks even less like a good deal for Sirius shareholders.

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