Sluggish growth clouds consumer electronics in 2025

• Smartphone and notebook shipments in 2025 will be flat or grow by only 1–2% YoY, TV shipments will decline by 1.1%, and the wearables market will contract by 2.8%.
• smartphones, notebooks, wearables, and TVs are expected to stagnate under the combined pressures of high inflation, a lack of breakthrough innovations, and ongoing geopolitical uncertainty in 2025.
• Looking ahead to 2026, most consumer product shipments are expected to remain flat or grow only modestly by around 1%, while wearables and automobiles may decline.

As we move into 2025, the landscape for everyday electronics—smartphones, laptops, wearables, and TVs—looks rather flat.

A combination of stubborn inflation, a scarcity of truly breakthrough tech, and the unending tension of global politics is leaving the industry at a standstill. Big names in the market are increasingly cautious, with even the most optimistic projections painting a picture of mere stagnation.

Consolidation looms for 2026

Industry insights suggest that by 2026, this sluggishness will only become more pronounced. Instead of a rebound, what’s coming is a consolidation phase, where growth rates slow even further. For those of us who remember the boom years, this feels like a sharp change of pace—a reality check driven by market saturation and limited innovation.

AI Servers: The lone bright spot

If there is a reason for optimism, it comes from the AI server sector—now the industry’s powerhouse for growth. Surging demand in data centres continues to fuel expansion, and 2025 looks set for another strong year.

TrendForce projects that AI server shipments will leap by more than 20 per cent compared to last year. Major cloud players are pumping funds into top-tier GPUs (think NVIDIA) and tailor-made ASIC chips for their infrastructures, crowding out budgets that otherwise went to run-of-the-mill servers.

Another fascinating trend is how companies are adapting their shipment schedules to deal with US tariffs and turbulent geopolitics. Many sectors are choosing to “front-load” their orders in early 2025, thanks in part to fresh Chinese government subsidies.

Products like servers, tablets, monitors, and vehicles are now expected to be shipped in equal measure in both halves of the year—a break from the usual pattern where the second half sees a spike.

While this might pad first-half revenues (and, let’s be honest, look good on quarterly reports), it comes with a price: the risk of slumping second-half sales and ballooning inventories by Q4.

Remember the buzz around AI-powered consumer gadgets? So far, the sizzle outweighs the steak. Despite splashy announcements, integrating AI into everyday devices is still mostly at the marketing phase. Without those must-have killer apps, most consumers remain unconvinced, and brands have little to show beyond upgraded spec sheets.

Muted numbers across the board

Taking stock for 2025, modest growth is the name of the game:

• Smartphones and notebooks look set to grow by a mere 1–2% (if at all)
• TV shipments could actually fall by 1.1%
• The wearables market is likely to shrink by 2.8%

Looking ahead to 2026, don’t expect fireworks. The best-case scenario for many categories is flat shipments or a minor uptick. Wearables and even automobiles face the possibility of decline. And while AI servers will remain a relative superstar, even their growth will taper, slowed by the challenges of scaling from today’s high base.

Awaiting a catalyst

To kick off the next phase of real growth, the electronics sector needs either a giant leap in technology or a new consumer application that genuinely excites and draws in the masses.

Until that happens, the industry will need to navigate a tougher, low-growth environment—one that rewards resilience, creativity, and perhaps a bit of patience.