“Good news!” exclaims Marie-Pierre Ducharme, Mouser’s Vice President, EMEA Marketing, resisting the temptation to punch the air. “It’s been a growth year, after two years of decline.
“We expected Europe would bounce back later that the Americas and Asia/Pacific, and that’s what happened. We would have been happy with single digit growth, but it rebounded more than we expected.”
A return to growth in its German business was a boost. Notes Ducharme: “It represents 22% of our business in Europe, so we needed it to start growing back, and it did.”
The fastest growing European markets for Mouser were Spain and Poland. The former is stimulating business through the government’s investment through its Recovery, Transformation, and Resilience Plan (PRTR). The Polish market has been energised by a supply chain shift away from Asia.
“Poland is a good physical location in Europe,” says Ducharme, “and more and more electronic manufacturing service companies are moving there.”
Steve Rawlins, Anglia Components’ Chief Executive Officer was less ebullient. “The market has been dreadful; it goes back to lots of excess inventory that customers are slow to burn off.”
Solsta’s Managing Director Jon Baxter saw the recovery pushed back through 2025. “Not any one thing,” he says, “though customers’ inventory took longer to burn off than anticipated.”
Dan Ford, Vice President, EMEA Sales at Farnell turns to a sporting cliché.
“2025, you could call it a game of two halves. I think the first half of the calendar year continued to be a real struggle. I think there was belief towards the back end of 2024 that the first half of 2025 would start to show some signs of recovery, but Q1 and Q2 were a struggle.”
He cites customers still challenged with high inventory levels and economic and geopolitical situations not helping.
“I think the second-half of the year we definitely started to see some signs that maybe we’d bumped around at the bottom for a while, and things had started to improve a little bit through the back end of Q3. September and October really started to see some improved market conditions, not massively dramatic in terms of a turn around, and some signals as to demand starting to increase a little bit and book to bills starting to improve.”
Adds Ford: “A few countries performed a little bit better than were expected and there were a couple that didn’t. I think Germany continues to struggle. I think its dependency on the automotive sector has an impact, so its market potential has obviously suffered and continues to be very challenged, not just in the tier one automotive manufacturers, but then the knock-on effect to supporting companies.
“I think France actually started to show some early signs of improvement and had probably a better Q3/Q4 than many were expecting and some of the Nordics as well. We started to see some signs of recovery that might come, again, down to some of the market sectors that are more fruitful, potentially in those markets such as defence and aerospace. The UK, in terms of some of the other big nations, was relatively average I would say, in terms of recovery. So a little bit better maybe than Germany, but probably not quite as good as France.”
On lead times and Average Selling Prices (ASPs), Ducharme cannot detect enough of a trend to draw any firm conclusions.
“Some lead times are going out,” she comments, “but not crazy on the semiconductor side. At present, manufacturers do not have enough visibility from their customers.
“Our advice from passive component manufacturers right now is to start planning demands for the next six months at least and provide them with some forecast visibility. When the ramp up comes, lead times could move up sharply if extra production capacity has not been put in place.”
The advance of AI is also impacting prices.
“AI requires a lot of processing so the memory market, especially DDR3 and DDR4 devices, is very buoyant, lead times are lengthening as suppliers prioritise different chip geometries and priorities,” observes Solsta’s Baxter.
Anglia’s Rawlins sees ASPs rising slowly: “We haven’t seen any major price increases yet, but they are coming,” he warns.
He also believes customers will soon need to change their buying patterns or they may run into trouble. “Customers across the market have too easily been able to buy what they want, when they want. That tide is now turning. Customers need to look at forecasting, and placing schedules for orders. If they are buying ad hoc they will run into trouble by the middle of the year.”
Rawlins notes tantalum capacitors as a bellwether for a market upturn. “Our sales increased by 30 to 40% last month. Small signal SO23 parts also picked up, that’s a good sign.”
Ford points to AI and data centres impacting prices. “We’ve seen some price volatility certainly on the memory side, there’s been some huge spikes in memory prices as demand for those products is increasing,” he comments.
“There’s then also the impact of tariffs,” he argues. “How can we have a call without talking about tariffs and the knock-on effect of tariffs on raw materials or on different geographic situations?
“It is leading to some manufacturers having to put up the pricing on some of the technologies that we acquire. So, for example, in the test and measurement space and in the single board computer space, we’ve definitely seen some increased prices.
“That said, it’s probably balanced by some price decreases,” adds Ford. “In some of the areas where the demand is a little bit lower and the supply is higher. So, for example, in the passives area and in some of the interconnect and e-mech products, I think there has probably been seen some price erosion in there. But on both increases and decreases, I wouldn’t say anything overly dramatic or see as a major trend.”
Can 2026 provide a big bounce back year?
Baxter at Solsta cites the defence and medical sectors as growth drivers.
“The medical market is doing really well and was a strong market in 2025,” he comments. “Security is also a promising sector and customers are showing more interest in AI and AI accelerators.”
He is encouraged by customers seeking face to face meetings with the sales team and the Solsta field applications engineers are well prepared to explain the benefits of suppliers’ products and what they can deliver for customers.
“AI is becoming less hype and more concrete,” remarks Ducharme. “There are real projects and prototypes so we expect AI to monetise in 2026. Sustainability has become more important for customers, and there is activity around security with the Cyber Resilience Act.” She also marks quantum computing as a sector that showed promise in 2025. “Defence is also booming, especially in France, as well as medical market activity in France and Italy.”
Farnell’s Ford is encouraged that design activity is definitely on the increase.
“I think there was a period where customers were less focused on innovation as we came through that COVID period and I think customers were more intent on taking their existing designs and enabling them for longevity in terms of the allocations that we saw.
“That led to many customers having challenges around their existing designs because they were designed around a single footprint or a single microprocessor, for example. I think that turned a lot of the attention from the engineering side to make sure that their designs were more robust, more resilient in terms of being able to switch between manufacturers and different technologies to keep their production lines going.
“I think that’s changed now, probably over the last six to 12 months, where I think there’s a general sense that customers have gone back to understanding that innovation is what’s going to protect them and differentiate them from their competitors and continue to allow them to take market share. So, I think we’ve definitely seen an increased demand and one of the ways that we see that is through our evaluation kits, which is a strong part of our portfolio. We’ve definitely seen an uptick globally on the demand for our evaluation kits. So I think that’s a good leading indicator in terms of the innovation and design activity that we’re seeing across various industries and geographies now.”
“2026 will be quite interesting,” is Rawlins’ summation. He is targeting 10% growth in 2026. “Customers are starting to reorder, so I think we are coming to the end of what the customers were holding on their shelves. And the number of hits on our web pages has jumped 40%,” he says. “We are now recruiting, and we have new lines to be launched in 2026.”
This article originally appeared in the Jan/Feb 26 issue of Procurement Pro.
