Moderate growth in the Pro AV sector persists despite a weak broader economic landscape, according to a recent AVIXA report.
Moderate Growth in the Pro AV Market Amidst a Softening Economy
The Professional Audio-Visual (Pro AV) market is currently experiencing moderate expansion in 2024, falling short of the pre-pandemic growth levels. This slow recovery is largely due to a combination of lingering macroeconomic factors and evolving market dynamics around technology adoption.
The global audio equipment market has been growing steadily post-2019, albeit at moderate compound annual growth rates. The consumer audio market in 2024 is valued at approximately $100 billion, driven by innovation and new segments. However, the growth is not explosive, with the global audio equipment market forecasted to grow at around 3.85% in 2024-2029, reaching nearly $77.81 billion by 2029.
The macroeconomic environment in 2024 is described as one of moderate growth, with many countries experiencing subpar GDP growth. For example, the U.S. economy added 114,000 jobs in July, below expectations of 175,000, and the unemployment rate increased to 4.3% from 4.1%. Similarly, Italy’s GDP is forecasted to grow about 0.7% in 2024. This restrained economic backdrop impacts capital spending and technology upgrades in Pro AV sectors, tempering rapid growth.
Growth drivers like increased use of smartphones, expansion of smart homes, and e-commerce penetration stimulate audio and AV demand. However, regulatory compliance, energy consumption concerns, and high costs are challenges limiting faster expansion. The COVID-19 pandemic disrupted many aspects of Pro AV demand, and while recovery is underway, some sectors are still stabilizing or adapting, such as the integration of AI-driven solutions in enterprise software and infrastructure.
The AVI-E (Pro AV Employment Index) is reliably steadier than the AVI-S (Pro AV Sales Index). In July, the AVI-S accelerated 2.3 points from 56.6 to 58.7, indicating a pickup in sales. The current AVI-E level is roughly in line with what was normal pre-pandemic but on the low side. The AVI-E for the month before that was 57.7, and for the previous month, it was 57.1.
The AVIXA 2024 Industry Outlook and Trends Analysis (IOTA) shows 2024 as a lower growth year before reacceleration in 2025. China's GDP grew by 0.7% in the second quarter, which is below both the 1.5% growth for Q1 and the forecast of 1.1%. Germany experienced a 0.1% GDP decline in the second quarter. On the other hand, the U.S. had Q2 GDP growth at an annualized rate of 2.8%, up from 1.4% in the first quarter and beyond the forecast of 2.1%. The EU GDP expanded by 0.3% in the second quarter, with an annualized rate of 1.2%.
In summary, the Pro AV market in 2024 is growing moderately compared to its pre-pandemic levels due to a balance of ongoing economic recovery, persistent challenges such as regulation and cost, and gradual technology adoption that is stimulating but not accelerating growth at a high pace yet. The current economic conditions are described as a soft macroeconomy, with expansion below what would be expected in a healthy economy.
- The moderate expansion in the Pro AV market in 2024 is being influenced by the general-news of a softening economy, as well as evolving market dynamics surrounding technology adoption.
- Despite the global audio equipment market showing moderate growth post-2019, the Pro AV sector's growth is being tempered by the current economic conditions, which are described as one of moderate growth yet falling short of what would be expected in a robust economy.
