Home Audio Market Losing Volume, Yet Value Holding Strong

Following record growth due to the pandemic boom, widespread inflation is beginning to significantly impact growth across the home audio market. However, according to the latest quarterly tracker from Futuresource Consulting, despite the fall in volumes, market value remains strong.

“Higher price brackets continue to perform well in the home audio space,” says Christopher Bull, Market Analyst, Futuresource Consulting. “That’s partly driven by inflation, but also due to consumers with higher incomes spending more on premium consumer electronics devices. In Q2 2022, home audio value has risen quarter-on-quarter, as well as year-on-year. Yet volumes are painting an ominous picture of the future.”

Regional Variations Show a Market in Flux

In global volume terms, this latest round of Futuresource research shows that every product category underwent contraction year-on-year in Q2. In particular, EMEA retreated following heavy inflation in Western Europe, and economic dislocation in Eastern Europe due to the conflict in Ukraine.

The North American and Chinese home audio markets are also beginning to show signs of significant cooldown, due to saturation of their smart speaker markets. Technology brands are also withdrawing from their previously enthusiastic support of the smart speaker market, with few new product launches and smaller orders for stock.

The META region has bucked the trend, with the home audio market enjoying a rise in shipment volumes. Futuresource attributes this to the launch of Alexa and Amazon smart products within the region. At the same time, LATAM has experienced a strong performance from wireless speakers in lower price brackets, spearheaded by market activity from JBL.

Pressure at the Low End, but Premium Items on the Up

“At a global level, we’re seeing a distinct trend beginning to emerge,” says Bull. “Lower-priced home audio products are being compressed by the dual impact of a market cooling from a rush of entry level products during the COVID-19 pandemic, and the escalating cost of living crisis.

“At the same time, sub-$100 products have surrendered market share to the higher brackets, most notably within the $100 to $199 range, which grew six percentage points quarter-on-quarter for Q2. All other higher price segments also performed well, with $500 to $999 gaining a percentage point, and the others either posting marginal growth or holding steady.”

For further information or to purchase the home audio quarterly tracker report from Futuresource Consulting, please contact leon.morris@futuresource-hq.com

About the author

Chris Bull

Chris is the lead project manager for the Home Audio Quarterly and Market Forecast reports. His reports look at the latest technology developments across Wireless Speakers and Soundbars, and include wider investigations into contextual issues such as Supply Chain analysis and regional variance. He has previously worked on Futuresource’s K-12 mobile PC market services and held panel discussions on esports and computer chip production.