Consumer Tech Spending in the U.S. to Grow by 4.4% in 2025
The Consumer Technology Association (CTA) is projecting growth in the U.S. consumer technology industry, with an expected 1% increase in 2024 to $505 billion and a further 4.4% growth in 2025 to $527 billion. This positive trend follows a period of decline in the market due to various factors such as high inflation, slow economic growth, and supply chain disruptions caused by the pandemic.
According to Rick Kowalski, the senior director of business intelligence at the CTA, the industry is experiencing growth again after two consecutive years of declines. This growth is attributed to factors such as falling inflation rates, which give consumers more spending power, and the beginning of a replacement cycle for tech products purchased during the pandemic.
One of the key drivers of the deflationary nature of the technology industry is Moore’s Law, which predicts the doubling of components on a chip every couple of years, leading to faster, smaller, and cheaper electronic devices. Despite supply chain challenges during the pandemic, prices of certain tech products have decreased, signaling a return to normalcy in accordance with Moore’s Law.
In addition to hardware sales, consumer spending on software and services plays a significant role in the consumer technology market, accounting for a third of total consumer technology revenue. The introduction of AI technology in various products is also expected to drive consumer interest and product refreshes in the coming years.
The CTA forecasts a rise in spending on live TV streaming services and gaming, with the popularity of cross-platform games, indie titles, and subscription gaming services contributing to the growth in gaming spending. AI-enabled laptops are also expected to be a popular choice for consumers, with new models featuring AI processing capabilities.
Overall, the consumer technology industry is poised for growth in the coming years, driven by technological innovation, consumer demand, and market trends. As the industry continues to evolve, consumers can expect to see a wide range of innovative products and services that cater to their changing needs and preferences.
