As I predicted last quarter the Information Technology and Communications market continues to grow. In total revenues reached $1.9 trillion (the highest of any quarter in history) in the quarter and $7.4 trillion in the year to the end of September – up 5% and 3% respectively. Net profit, however was down 3% to $265 billion in the quarter and level at $1.1 trillion for the year. This shows that, while conflict, global warming, inflation and the slow road to recovery from the COVID-19 pandemic challenge countries, regions and governments alike, our industry is fuelling recovery. I’ll address the extent to which our market is contributing to, or helping to solve these issues in my up-coming predictions for 2025.
At a country level quarterly growth in current $US rates varied from +6% in Brasil to -4% in Hungary and annual growth from +7% in Brasil to -3% in Australia. I’ve included the top and bottom 8 of the 43 countries I track in my Figure above, ranking them on quarterly growth in current $US rates. The dotted lines show growth in local currencies with higher growth for those (China, Chile, Australia, Egypt, Japan) whose currencies declined against the $US and lower (Colombia, Mexico) for those that increased on the same measure. In the case of Brasil, Peru, UAE, Spain and Hungary local currency rates grew against the $US on a quarterly, but declined on an annual measure. For the USA local and current $US rates, of course were identical. These variations will no doubt be even greater next year if President Trump succeeds in introducing additional trade tariffs!
As for offerings (I’ve selected those which are most important indicators for me), it was the raw storage devices (NAND and DRAM chips and Hard Disk Drives (HDDs) which showed the strongest revenue growth rates (57%, 50% and 49% respectively). For the first time in years spending on servers led the product markets, growing by 40% in the quarter – largely due to the booming market for AI inferencing in data centers for systems using multiple Nvida GPUs. There was also good spending growth for Smart Phones (17%) and Storage Systems (16%). Cloud computing has reached a level of maturity with spending on IaaS/PaaS growth at 14% and SaaS at 6% – much lower than a few years ago. There was some spending growth in all of the major enterprise IT products apart from Infrastructure Software, which was level in quarterly and annual spending with 2023 rates. Gaming was the worst performing area with a decline of 31% in the quarter and 30% in the year.
My Figure above shows the revenue growth of the top 8 vendors I track continuously. The server vendor Supermicro led the way with a revenue growth of 181% in the quarter and 154% in the year. Nvidia – whose GPUs and Infiniband network products are largely responsible for the renaissance of the server market – grew by 94% in the quarter and 152% in the year. An impressive result when you consider that I exclude its vendor to vendor business in my research; its total revenues were $113b in the year. Other leading vendors included raw storage suppliers SK Hynix, Seagate, Western Digital and SDK, contract manufacturers Quanta and Wistron, cloud and smart phone supplier Google and PC companies Xiaomi and Lenovo.
STMicro was the worst performing of the vendors I track. Others in the bottom 8 include network suppliers Nokia, Ruckus/Compscope and Extreme Networks, Telecom Italia, distributors Arrow and Northamber, mobile manufacturers Voxx and Micromax, gaming company Nintendo and infrastructure software company Falconstor.
I am surprised somewhat at the resurgence of the ITC market in the third quarter and hope that it will continue and (on balance) help relieve some of the world’s mighty economic and social challenges. I’ll address this more fully in my predictions which should be with you in a few days time. I’m interested in your feedback on this post as always – so please contact me if you have comments and/or you need to know more about my research and findings.
Information Technology and Communications research
