European components distribution suffers bruising Q3

8th November 2023

(DMASS) Distributors’ and Manufacturers’ Association of Semiconductor Specialists

Mick Elliott

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European components distribution has reached the tail end of a longer than expected growth period and is now experiencing a market contraction, says DMASS Europe.

In Q3/2023 the market declined by 5.6% to 5.15 billion Euro. While semiconductors went down by 3.2% to 3.65 billion Euro, IP&E (Interconnect, Passive and Electromechanical) components declined by 11% to 1.5 billion Euro.

Hermann Reiter, chairman of DMASS, commented, “Considering the situation of a 3-year growth stretch with heavy allocation across most components’ segments, the current slowdown is not unexpected. As inventory levels are still high, we are seeing weak bookings for the time being. 2023 will probably end slightly positive at high revenue levels, 2024 will require our patience until a substantial turnaround of the demand side will occur. Long-term, our expectations remain positive, especially for distribution in Europe and all the industry segments we serve.”

At a total revenue of 3.65 billion Euro, semiconductors showed a slight decline of 3.2% at a still healthy level. Regionally, only a few countries or regions remained positive. The UK posted a 2.9% increase to 244 million Euro, the German market rose 2.5 % to 1.1 billion. Turkey advanced 24.5 % to 81 million Euro.

The rest slid into slowdown. Sales in Italy dropped 1.16 % to 329 million Euro. Nordic sales fell 10.1 % to 286 million Euro.

Most semiconductor product groups showed negative growth, except for MOS Micro, Programmable Logic and Other Logic.

Discretes took the biggest hit, tumbling 27 % to 165.2 million Euro. Memory sales plummeted 26.9% to 289.3 million Euro.

Programmable logic bucked the trend rising 37.9 % to 340. 2 million Euro. MOS Micro sales of 856.1 million Euro were up 16.4 %.

In IP&E, the slowdown that was already under way since the beginning of 2023, continued in Q3. The IP&E distribution market declined by 11 % to 1.5 Billion Euro in the summer quarter. Regional differences were much more obvious than in semis: Of the bigger countries Germany was hit hardest with falling nearly 17 %, while France only declined by 2.3 %.

The only country with positive growth was Turkey up 28%. On the product side, Power Supplies suffered the least, while Electromechanical components (including Interconnect) declined by 9.3 % and Passives by 14.4%