Pro AV Growth Accelerates, Remains Slow
Highlights
- The change is good, the level is not. In December, the AV Sales Index (AVI-S) increased a point to 53.1 (from 52.1 in November). It’s always positive to see the AVI-S increase, even if it’s only a modest shift of one point. The less positive news is the level. 53.1 means the industry continues to grow, which is inherently good. Any growth is good growth! But our industry is used to higher levels, as 53.1 remains well below historic norms. The mixed interpretation of the December AVI-S aligns with the rest of the index data in its combination of modestly positive and negative results. As we cover in the next bullet point, respondents report a good year overall despite lower monthly numbers (especially of late). On the other hand, the third bullet point covers the employment side of the index, which sees its worst level since January 2021. Zooming in on the details underlying the December monthly results, respondents listed familiar concerns: Some saw a quiet period due to the holidays, while others in different sectors benefited from year-end spending pushes. Hiring struggles, general economic concerns, and technology details also factored in.
At the end of the year, there are two ways we assess the year’s performance in the index: Averaging the year’s performance and asking the same monthly question but in annual format, i.e., how 2024 compared to 2023. The latter is our preferred metric as it nets out monthly up-and-down fluctuations, creating a more reliable whole-year indicator. In 2023, both indicators told a similar story: solid year, worse than 2022 but still good. In 2024, the two stories differ. The yearly average for 2024 was 56.7, which is down from 58.8 in 2023—a negative signal. However, our preferred metric, the annual change question, shows a diffusion index of 67.7 for 2024, which is essentially flat compared to the 67.1 for 2023. It’s reassuring to see respondents net out their year so positively after seeing recent months in the AVI-S so low. Yes, the monthly trend is disappointing, but the overall annual change question gives us a positive counter to the negativity of the monthly numbers.
- December was a clear disappointment for the AV Employment Index (AVI-E). After dropping 2.9 points from 55.8 to 52.9 in November, the AVI-E declined a further 1.3 points to 51.6 in December. This is the lowest result since January 2021. The caveats covered in the AVI-S discussion (and previous months of index coverage) apply here: First, with the number above 50, growth continues, and that is always good! Second, the market is in a healthy place, which means that flat payrolls are essentially fine—a stark contrast to January 2021 when the industry desperately needed strong growth to rebound from the pandemic. So, it’s not all bad news even though it is a dispiritingly low result.
International Outlook
As predicted, North America and the rest of the world converged in our initial reading of our regional AVI-S.1 For North America, the AVI-S is now 51.1, up from 50.4 in the finalized November reading, while the rest of the world saw its level drop from 57.3 to 55.7 in our initial December reading of the moving average. This now marks 17 consecutive months that the rest of the world has exceeded North America in our geographic breakdown, a record-long streak that shows no signs of abating. We anticipate it being some months before the regions have a chance of changing positions in terms of growth leadership.
1Due to the small sample, the North American and International indexes are based on a 3-month moving average. The December 2024 index is preliminary, based on the average of November and December 2024 and will be final with January 2025 data in the next report.
1AVIXA®, the Audiovisual and Integrated Experience Association, has published the monthly Pro AV Business Index since September 2016, gauging sales and employment indicators for the pro AV industry. The index is calculated from a monthly survey that tracks trends. Two diffusion indexes are created using the survey: the AV Sales Index (AVI-S) and AV Employment Index (AVI-E). The diffusion indexes are calculated based on the positive response frequency from those who indicated their business had a 5% or more increase in billings/sales from the prior month plus half of the neutral response. An index of 50 indicates firms saw no increase or decline in business activity; more than 50 indicates an increase, while less than 50 indicates a decrease.
Future projects are pending, [and] completion dates are lengthy affecting reimbursable schedules. Ordering materials and equipment for planned installation will precede completion and commissioning and cash flow will be committed pending long lead close out schedules prior to collection. Efficiency with procurement, project management, and Progress Payment remittance, will be a priority
AV Integrator, APAC
We are seeing slow down due to holidays and planned time off scheduled. We are also seeing last minute large orders and purchases of using budgets before year end.
Distributor, North America
Obtaining skilled labor with rising salary expectations. General political uncertainty. New Government with consequential economic forecasting. Exceedingly fast-moving changes in technology using AI which permeates all parts of our business.
IEnd User, EMEA
Methodology
The survey behind the AVIXA Pro AV Business Index was fielded to 2,000 members of the AVIXA Insights Community between December 23 2024, and January 6, 2025. A total of 270 AV professionals completed the survey. Only respondents who are service providers and said they were “moderately” to “extremely” familiar with their company’s business conditions were factored in index calculations. The AV Sales and AV Employment Indexes are computed as diffusion indexes. The monthly score is calculated as the percentage of firms reporting a significant increase plus half the percentage of firms reporting no change. Comparisons are always made to the previous month. Diffusion indexes, typically centered at a score of 50, are used frequently to measure change in economic activity. If an equal share of firms reports an increase as reports a decrease, the score for that month will be 50. A score higher than 50 indicates that firms, in the aggregate, are reporting an increase in activity that month compared to the previous month. In contrast, a score lower than 50 is a decrease in activity.
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