July 23, 2019, Nevada City, California – New Venture Research (NVR) announces the publication
of its annual electronics manufacturing services report, The Worldwide Electronics Manufacturing
Services Market – 2019 Edition.

In 2018, the worldwide contract manufacturing (CM) services market increased significantly—by
15 percent in total revenue—resulting in combined EMS and ODM revenue of nearly $542 billion, an
expansion of $70.7 billion. Revenue growth from 2013 to 2016 had been flat, but expanded dramatically
in 2017 and 2018.

Figure 1 The Worldwide CM Market ($M), 2013–2018

Source: New Venture Research

The CM market has been sustained by the strong demand for smart phones, and the even more
powerful demand for infrastructure networking equipment to build out the 5G wireless architecture
with products like enterprise storage systems, enterprise LANs, and servers. The need for cloud
computing, social media, and real‐time data and video streaming is driving the need for advanced
switching, routing, and wireless communication hardware.

For the ninth year in a row, the industry was profitable at $8.4 billion (for 42 EMS public
companies and 17 ODM public companies), the same amount achieved in 2017. Foxconn accounted for
nearly half of all the money made by the EMS industry in 2018, and EMS companies accounted for
approximately 80 percent of the total. Only five EMS companies and one ODM company lost money in
2018. Pegatron ranked second in net income for EMS firms ($369 million). Meanwhile, Delta Electronics
($639 million), Quanta Computer ($473 million), and Lite‐On ($264 million) ranked highest in earnings
for the ODMs.

Plant closures and openings were rare in 2018, as most companies appear to have right‐sized
their operations or closed facilities due to consolidation. New openings are clearly related to new
business opportunities, while the closures are being driven by economic decisions such as right‐sizing
the company.

Figure 2 presents the total available market (TAM) for electronics assembly in 2018 by segment.

Figure 2 The Worldwide Market for Electronic Products Assembly by Market Segment, 2018 ($1.3T)

Source: New Venture Research

Communications and computer products will continue to be the segments driving the largest
growth in the electronics industry. Fueled by the demand for EMS services, the contract manufacturing
industry will grow from $542 billion in 2018 to $777 billion in 2023, at a CAGR of about 7.5 percent.
Outsourcing has become a critical element in keeping the electronics assembly industry
expanding and driving costs down each year, and is a leading factor in stimulating continuous consumer
demand and technology deployment. The trend to move price‐sensitive manufacturing to low‐cost
regions has ceased, but will continue to impact the industry for all suppliers in the foreseeable future—
at least regionally.

The Worldwide Electronics Manufacturing Services Market – 2019 Edition is over 600 pages in
length, and examines the leading 102 EMS and ODM suppliers across 52 countries and 52 product
industries and more than 900 manufacturing locations. For more information, contact Karen Williams at
New Venture Research at 408‐244‐1100 or visit www.newventureresearch.com.