Large format display market falls as tariffs hit global sales

New analysis from CONTEXT shows that the global Large Format Display (LFD) market faced a decline in both unit sales and revenue at the start of 2025 amid ongoing tariff discussions and market pressures.

According to CONTEXT's findings, unit sales fell by 1.7% year-on-year in the first quarter of 2025, with revenue dropping by 10.9%. This downturn has been linked to continued price erosion and uncertainty arising from trade policy developments, particularly tariffs affecting cross-border shipments.

Aaron Smith, Senior Analyst for Displays at CONTEXT, explained: "We continue to see the impact of trade policy and tariff developments play out across the global LFD market. While the 10% baseline tariff on goods entering the US remains in place, the 90-day suspension of reciprocal tariffs, excluding China, has provided temporary relief for key exporting nations such as Japan and South Korea. Without this suspension, tariffs would have been as high as 30% and 35% respectively, significantly increasing costs."

While the temporary pause in these reciprocal tariffs has offered a brief window of relief for key manufacturing countries, CONTEXT notes that the reprieve for the LFD sector may be short-lived. Smith commented: "However, we are not out of the woods. Expectations of further tariffs on semiconductors, a critical LFD component, could once again disrupt pricing structures and supply chains."

The report highlights the potential for added complexity if volatility in US government decision-making continues. There is evidence that businesses and consumers are beginning to consider alternative brands due to concerns about possible future price increases. Some manufacturers have started to transfer additional inventory to US-based warehouses as a precaution, following a trend observed in other segments in anticipation of regulatory or tariff changes.

Within the sector, average selling prices have broadly continued to fall. Direct View LED categories have been most affected, experiencing significant year-on-year price reductions. While lower prices have helped stimulate demand in some markets where budgets are limited, these same conditions have driven down overall revenues and placed pressure on margins for vendors and their partners in the distribution channel.

Market performance across Europe has not been uniform. For example, France experienced a marked correction with unit sales down 25.5% in the first quarter of 2025. This follows a period of heightened demand associated with the 2024 Olympics. Similarly, Interactive Displays have seen declines in several key European markets: Germany posted a decrease of 17.2%, Italy 65.3%, and Spain 21.3%. CONTEXT attributes Spain's downward trend to signs of market saturation after robust activity in the previous year.

On forecasting for 2025, Smith said: "2025 is shaping up to be one of the most challenging years to forecast. While price drops are creating opportunities in some segments, uncertainty around tariffs, particularly those potentially affecting semiconductors, means there is considerable risk to both supply chains and pricing strategies. The industry also grapples with changing procurement behaviours, with some customers accelerating purchasing to avoid future cost increases, while others consider renting solutions to mitigate capital expenditure."

Across selected European countries, Q1 2025 year-on-year unit volumes and revenue varied significantly. Positive trends were observed in Poland (units up 75.4%, revenue up 43.4%), Turkiye (units up 58.1%, revenue up 117.6%), and Estonia (units up 25.0%, revenue up 62.8%). Conversely, markets such as Lithuania (units down 44.6%, revenue down 48.5%), Italy (units down 30.2%, revenue down 38.4%), and France (units down 25.5%, revenue down 21.7%) reported considerable declines. The United Kingdom saw a slight increase in units (up 0.7%) but a drop in revenue (down 7.6%).

Countries including Czechia, Portugal, Netherlands, Slovakia, Spain, Sweden, Switzerland, Austria, Hungary, Finland, Germany, and Latvia recorded mixed unit and revenue performance, reflecting the broader volatility affecting the sector.