European channel sales could jump double digits in Q2 - Context

Remote working, environmental purchasing decisions and the EU's €1.8tn recovery fund will impact the IT channel for the rest of the year

Revenue growth through distribution across Europe could be up ten per cent year on year in Q2 2021, according to figures from Context.

The market analyst added that supply chain issues and comparatives with strong 2020 figures may lower the figure slightly.

Context says it "optimistically" predicts ten per cent growth in Q2, followed by 8.5 per cent in Q3 and eight per cent in Q4.

It explained this would require the easing of supply chain problems experienced earlier on in the year, driving notebook sales up five per cent, and new partnerships enabling distributors to take an additional one per cent share of European cloud revenues.

The Green economy and the EU's €1.8tn recovery fund

"As a result of the pandemic we're seeing more remote workers invest in home office equipment and employers kitting out the workplace to support a new hybrid model," said Context global MD, Adam Simon.

"These are just some of the reasons why we're forecasting impressive channel growth for the rest of 2021, despite strong year on year comparatives.

"Two other factors that will increasingly influence the market as we head into 2022 are the environmental concerns of consumer and B2B IT buyers, and the EU's huge €1.8tn recovery fund, much of which will be spent on digital."

Potential blockers

On the other hand, Context also provided predictions for a "pessimistic scenario", which would see slightly smaller growth of 7 per cent in Q2, followed by 3 per cent and 4 per cent in succeeding quarters.

It outlined supply chain issues and reduced demand for notebooks, muted telecoms growth, and infrastructure categories losing out to cloud migration as contributors to this lower growth.