Led by revenue growth from LED lighting sector, the global market for AC-DC and DC-DC merchant power supplies grew 5.7 percent in 2018 to reach $22.1 billion, compared to 3 percent growth between 2016 and 2017. Revenue growth is projected to grow at a five-year compound annual growth rate (CAGR) of 5.7 percent from 2017 to 2022 to reach $27.6 billion, according to IHS Markit.
The popularity of LED lighting in commercial and retail applications is driving much of the growth in this market, as businesses look to save energy and money by replacing fluorescent lighting with LEDs. However, the LED lighting market is getting very volatile and very competitive, putting greater pressure on average selling prices and profit margins. This situation is causing large power supplies companies to investigate other sectors and custom orders where profit margins are potentially higher.
Regional growth led by Asia-Pacific
Asia Pacific was the largest regional market for power supplies in 2018, based on both revenue and unit shipments, accounting for 62.5 percent and 74.6 percent of the regional market share, respectively. The Americas was the second-largest market in 2018, accounting for 21.1 percent of revenue and 14.4 percent of unit shipments. Europe, Middle East, and Africa (EMEA) accounted for the remaining 16.4 percent of revenues and 11.1 percent of unit shipments in 2018.
Revenues from Asia-Pacific will grow at slower pace between 2017 and 2022, due to declining growth in AC-DC commodity applications. However, Asia-Pacific is still expected to maintain the largest share of revenue and unit shipments, reaching 59.3 percent in 2022.
Market growth driven by the AC-DC non-commodity applications
The AC-DC non-commodity market is projected to be the fastest-growing market segment from 2017 to 2022, with a revenue CAGR of 10 percent, compared to 2 percent growth in DC-DC applications and a 0.2 percent decline in the commodity segment. This growth in AC-DC non-commodity segment is mainly due to strong growth in LED lighting and medical applications. Revenues for the AC-DC non-commodity market exceeded revenues for the AC-DC commodity market by 30 percent in 2017.
LED lighting was the largest segment of the total AC-DC and DC-DC merchant power supplies market, with 27 percent share of total revenues in 2018, followed closely by the high-volume, low-margin mobile devices and chargers segment, with a 25 percent share. The revenue share of the mobile devices and chargers segment is expected to drop to 18 percent of the total power supply market by 2022, due to stagnant demand and decline in average selling prices in the mobile devices and chargers segment.
AC-DC & DC-DC Merchant Market & External Power Adapters Report - 2018
This report assesses the global power supplies market, including AC-DC, DC-DC merchant power supplies and external power adapters and chargers market. The study identifies growth opportunities by product, application, region, and countries. It also contains an analysis of the competitive environment by ranking power supply companies by each application based on their revenue share.