CTA forecasts lower US tech sector revenues
January 4, 2023
As the technology sector converges on Las Vegas for CES, research from the Consumer Technology Association (CTA) projects US technology retail revenues of $485 billion (€456bn) in 2023.
This new data puts revenues slightly above pre-pandemic levels, following a three-year surge in consumer technology spending that peaked at a record-breaking $512 billion in 2021. While CTA anticipates a looming recession and inflation will weigh against consumer spending in the coming year, consumer technology industry revenues will remain roughly $50 billion above pre-pandemic levels.
“The technology industry is a deflationary force in the global economy,” said Gary Shapiro, president and CEO of CTA. “The constantly evolving nature of technology leads industries to find newer, more efficient ways to drive commerce. CES has become the destination for innovators who are making business more efficient and improving our quality of life in industries like agriculture, transportation, health and so many more.”
Notable areas of revenue growth for the technology industry in 2023 include:
Technology Services: Consumer spending on technology services including gaming, video, audio and apps will grow for the fifth straight year, generating $151 billion in consumer spending. The video streaming market is especially competitive with major brands vying for consumer attention.
Automotive Technology: Factory-installed automotive technology revenues are projected to rise 4 per cent to $15.5 billion in 2023. Advances in battery technology have allowed producers of electric vehicles to offer increasingly consumer-friendly options, with companies including Panasonic, LG and other companies building infrastructure to support more battery production.
Health and Fitness Technology: Health and fitness services including fitness subscription services and digital therapeutics are projected to rise 9 per cent to $928 million in 2023. Thanks to a landmark 2022 ruling from the US Food and Drug Administration (FDA), over-the-counter hearing aids will be sold in stores for the first full year – generating $891 million in revenue in 2023.
CTA has lowered expectations for sales of laptops, LCD TVs, tablets, smartphones and gaming consoles. Despite flat overall TV sales, OLED TV is projected to add $2.3 billion in 2023 revenues as the industry focuses on premium products. As home gaming console sales slow, portable gaming models gain traction with consumers who are spending less time at home since the pandemic began. Portable gaming consoles will generate $1.5 billion in 2023, up 41 per cent over 2022.
CTA has been at the forefront of advocacy for policies that support US businesses in consumer technology. “Leaders in Washington can help American entrepreneurs by advocating for a proactive and pro-innovation approach to trade,” said Shapiro. “We need to eliminate tariffs that amount to taxes on US businesses, and spur exports by striking new trade deals with our friends and allies.”