Forecast: US tech industry revenue to hit $487bn in 2021
July 20, 2021
Retail sales revenue for the tech industry in the US will reach a record-breaking $487 billion (€413bn) in 2021 – a 7.5 per cent jump year-over-year – powered by consumer demand for tech related to work, school and lifestyle, according to a report by the Consumer Technology Association (CTA).
“The pandemic strengthened consumers’ relationship with technology forever,” said Gary Shapiro, president and CEO, CTA. “From working to learning, staying connected with loved ones and taking care of our health, tech played a crucial role in improving our lives. Tech has proved time and again that innovation makes our country resilient in the face of crises. Even though the US still deals with supply chain shortages, labour gaps, vaccination rollouts and looming inflation, tech will help us keep pushing forward.”
CTA’s twice-yearly U.S. Consumer Technology One-Year Industry Forecast reflects US manufacturer shipments for more than 100 consumer tech products and related software and services. The report identifies major trends shaping the future of consumer technology as the economy navigates its path toward the post-pandemic world.
Smartphones: 5G smartphones will see exponential growth as consumer demand continues to climb with many looking forward to upgrading their phones, waiting to explore the benefits of this new technology. More than 106 million 5G smartphones are expected to ship in 2021 (a 530 per cent jump from 2020), generating $61 billion in revenue (a 404 per cent increase). Overall shipments of smartphones will increase 10 per cent to 154 million units, earning $73 billion in revenue, up 15 per cent.
Laptops: With many Americans still working from home, CTA expects the record year-over-year growth trend of 2020 to continue in 2021. Shipments for laptops will reach 76 million units (up 9 per cent), earning $45 billion in revenue (up 11 per cent).
True Wireless Earbuds: Devices such as Apple Airpods and Samsung Galaxy Buds continue to see strong growth in 2021, with 88 million units expected to ship, a 27 per cent jump from last year, representing $8.7 billion in revenue (8 per cent increase).
Being Healthy and Hip
Health/Fitness: For the first time, CTA includes connected exercise equipment such as stationary bikes, rowers and treadmills in this report. With demand for products such as Peloton and MYXfitness soaring, roughly 1.5 million units were shipped in 2020, and in 2021 the devices will cross 2 million (a 43 per cent rise) and earn $3.9 billion (a 40 per cent increase).
Shipments of connected health monitoring devices such as smart thermometers, pulse oximeters and blood pressure monitors will grow to 13 million units (up 23 per cent) and earn $740 million in revenue (a 17 per cent increase). The total revenue of health and fitness tech will reach $13 billion in 2021, a 12 per cent growth over last year. Smartwatches will grow 8 per cent in unit shipments, driven by tech-savvy and fashion-conscious consumers.
E-bikes: Personal mobility, which includes battery-powered bikes and scooters, is one of the fastest growing categories. CTA projects a total of 1.2 million e-bikes to ship in 2021 (up 15 per cent), earning $1.9 billion in revenue (a 3 per cent jump).
Smart Home: With growing demand for smart speakers and home robots, CTA projects that more than 100 million smart home devices will ship in 2021 (up 11 per cent), holding flat on revenue, with $15 billion.
Staying Engaged and Entertained
Software and Streaming Services:
- Audio: As music, audio books and podcast listening continues to gain momentum, CTA predicts earnings will reach $10 billion (up 18 per cent).
- Video: After an unprecedented surge in subscription growth for video streaming services in 2020, 2021 will see continued growth in demand. The revenue for these services is expected to reach $43 billion, up 15 per cent over last year.
- Gaming: Following a record year for gaming services in 2020 – a 25 per cent increase in revenue – 2021 will see a slight decline reaching $48 billion, down 2 per cent over last year.
Gaming Consoles: Following more than $5 billion in revenue in 2020, gaming consoles will see continued growth in 2021 as combined home and portable console shipments reach 19 million units (up 6 per cent), accounting for $6 billion in revenue (up 18 per cent).
Televisions: Overall TV shipments will hit 45 million units, lower than 2020’s record volume of more than 47 million, but with revenue growth of 5 per cent ($24 billion). More than three-quarters of TVs shipped this year will be 4K UHD. With a majority of content consumption still happening indoors, consumer enthusiasm for large screen TVs is growing. LCD TVs with screen sizes 70-inches and up will reach 4.3 million in shipments, earning $4.4 billion, and 8K Ultra HD sets, which will see shipments climb to 2.6 million units in 2021, are expected to earn $5.7 billion (a 371 per cent increase).
NEXTGEN TVs will see shipments increase nearly sixfold to 2.1 million units with revenue of $3.9 billion, up 425 per cent.
VR and AR: Virtual Reality (VR) and Augmented Reality (AR) hardware returns to growth in 2021 following a pause in 2020 caused by widespread disruption to the global supply chains. VR shipments will reach 2.7 million units (up 30 per cent). Total revenues for the VR and AR hardware shipments will cross more than a billion dollars (a 34 per cent increase).
E-toys: Parents found value in using educational toys as learning shifted to home during the pandemic. Shipments of e-toys including robots and musical instruments, will reach 61 million (a 7 per cent increase), earning $3.6 billion (up 14 per cent) in 2021. Specifically, STEM toys, which make up a growing part of this category, will see 4.7 million shipments (a 19 per cent jump), earning $187 million (a 24 per cent increase).
“As the country reopens, tech will continue to play a central role in people’s lives, from use of smartphones to upgrading automotive tech,” said Rick Kowalski, director, industry analysis and business intelligence, CTA. “With apparel sales on the rise, wearable technologies like smartwatches and wireless earbuds are also making gains. Technology is now an integral part of the modern wardrobe.”