Gartner: Technology sales have bottomed out

Things can only get better but recovery will be slow.

Analyst house Gartner has said that the effects of the recession have passed their worst in the electronics industry, but that recovery will be slow.

In a review of the industry, the company said that sales look to have stopped falling and worldwide demand is on the up. However, in some sectors sales won't reach 2007 levels until 2012.

“Almost all sectors of the electronic equipment market have now hit bottom and await signs of ‘first growth’ in comparison with the same quarter last year,” said Klaus Rinnen, managing vice president at Gartner’s semiconductor manufacturing group.

“The first signs of growth will be led by seasonal buying patterns in the PC market during the third quarter of 2009, although other major sectors will not begin to show first growth, year-on-year, until 2010.”

The PC market remains caught by poor demand from enterprises for hardware refreshes since the start of the year, but Gartner said that consumer demand, particularly in China and the US, was stronger than expected and was rising again.

Meanwhile the mobile market bottomed out in the third quarter of this year and will start to recover in the first quarter of 2010. It halved its earlier estimates of market shrinkage from eight percent to four.

“Although the first signs of recovery are starting to appear for the electronics industry, the damage from the current industry recession will be felt for a long time,” said Mr. Rinnen.

“This is seen in our current five-year semiconductor revenue forecast, which does not show recovery to 2007 levels until 2012. Vendors must prepare for significant changes in consumer buying behaviour, technology demand patterns and a changed supplier landscape.”