Audio & Video Equipment Manufacturers
Industry Profile Report
Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters
Industry Overview Current Conditions, Industry Structure, How Firms Operate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.
Call Preparation Call Prep Questions, Industry Terms, and Weblinks.
Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.
Industry Profile Excerpts
Industry Overview
The 460 audio and video equipment manufacturers in the US produce electronic audio and video equipment for home entertainment, motor vehicles, and public address and musical instrument amplification. Products include stereo equipment, speaker systems, televisions, household-type video cameras, jukeboxes, microphones, and amplifiers for musical instruments and public address systems. Large firms typically enjoy scale benefits, while small firms compete by offering specialty products.
Inventory Obsolescence
Rapidly evolving technology and fast product development cycles, which characterize the audio and video equipment manufacturing industry, can lead to inventory obsolescence.
Dependence on Foreign Contract Manufacturing
Although US firms play a significant role in the domestic audio and video manufacturing market, foreign production in countries with lower labor costs is the norm.
Industry size & Structure
The average US audio and video equipment manufacturer operates out of a single location, employs about 20 workers, and generates $8 million annually.
- The US audio and video equipment manufacturing industry consists of about 460 firms that employ about 9,500 workers and generate about $3.8 billion annually.
- The industry is concentrated; the top 50 companies account for 78% of industry revenue.
- Large firms are generally the US subsidiaries of foreign companies, which include Samsung, Sony, and LG Electronics. Multi-national conglomerates dominate the industry. Large US companies include Bose and GoPro.
- While television manufacturing is included in the industry, foreign-owned firms produce the vast majority of TVs sold in the US. TVs assembled in the US typically use parts from abroad.
Industry Forecast
Audio & Video Equipment Manufacturers Industry Growth
Recent Developments
Mar 21, 2024 - Shipments Rise, Inventories Decline
- Audio and video equipment shipments grew significantly in late Q3 2023 compared to a year ago, while inventories dropped, according to data from the Census Bureau. Shipments were up 31% in September 2023 year-over-year and were 7% lower than August 2023. Audio and video equipment inventories fell 17% in September 2023 compared to the previous year while increasing 2.5% from the last month. Additionally, consumer spending levels showed a slight upward trend in the first nine months of 2023, according to personal consumption expenditures data from the Bureau of Economic Analysis.
- US manufacturing activity contracted in February 2024, falling below the baseline for growth for the sixteenth consecutive month, according to the Institute for Supply Management’s Manufacturing ISM Report on Business. The Manufacturing PMI registered 47.8% in February, down 1.3 percentage points from the 49.1% recorded in January. A reading above 50% indicates manufacturing expansion. February’s New Orders Index was in the contraction zone at 40.2%. The February Production Index was 48.4%, a decrease from January’s 50.4%. Eight manufacturing industries tracked by the ISM reported growth in February: Apparel, Leather & Allied Products; Nonmetallic Mineral Products; Primary Metals; Plastics & Rubber Products; Fabricated Metal Products; Chemical Products; Miscellaneous Manufacturing; and Transportation Equipment. The industries reporting contraction in February were Furniture & Related Products; Machinery; Wood Products; Computer & Electronic Products; Food, Beverage & Tobacco Products; Paper Products; and Electrical Equipment, Appliances & Components.
- The Pro AV Sales Index rose in December 2023 month over month, according to the Audiovisual and Integrated Experience Association (AVIXA). The Pro AV Sales Index registered 60.4 in December, 3.5 points higher than November and about the same as December 2022. An index of 50 indicates firms saw no growth or decline in business activity; more than 50 indicates an increase, while less than 50 indicates a decrease. Respondents named hiring difficulties and supply chain issues as challenges facing their businesses. The monthly average index in 2023 was 58.8, representing a “solid year” but not as good as 2022, according to AVIXA.
- Audio and video equipment manufacturers will have to monitor minimum wage changes, as 22 states increased their minimum wages in January 2024, according to USA Today. About half of the increases are automatic adjustments linked to inflation. States that raised their minimum wages in January 2024 include Hawaii ($14), Maryland ($15), Nebraska ($12), and Washington ($16.28). Several states are set to boost their minimum wage levels later this year, including Florida (up to $13 in September) and Nevada (up to $12 in July). According to the Economic Policy Institute, nearly 40 US cities and counties will increase their minimum wage rates above state levels at the start of the new year. The federal minimum wage is $7.25 an hour, and more than 20 states, primarily located in the South and the Midwest, use the federal minimum as their wage floor.
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