By: David Gordon, Channel Marketing Group

As the calendar turned, many in the lighting industry said “good riddance” to 2025. It was a rocky road given the impact of tariffs on the project market and product pricing. At the end of the day for most it was a “meh” year from a revenue viewpoint with tariff “inspired” pricing perhaps enabling for flat revenue performance … not a report card that anyone wants to come home with.

Because a “flat” probably means “down in units.”

2025 Q4 Pulse of Lighting Report

Our 2025 Q4 Pulse of Lighting report, based upon feedback from about 200 manufacturers, reps / lighting agents and distributor personnel, indicated, essentially, a flat Q4, with almost 50% of distributors reporting +/-2%! Manufacturer feedback formed a nice bell curve.

Some other insights from the report:

• The small to medium-sized renovation market is the driver and is perceived as “steady” with everything else “slow.” This means “value-engineered” initiatives are where opportunities are. Design/build contractors are also busy.
• When it comes to conversions, distributors prefer names that the recognize vs “no-name” brands. It gives them a little more “trust.” (Coincidentally, we have access to proprietary industry research that shows that companies that are investing in brand building have greater revenue growth and market share. The research was conducted by Kerrwil Media for US Lighting Trends, a Channel Marketing Group service … and we’ll share it with manufacturers at the upcoming NAED regional meetings – reach out to schedule a meeting.)
• Backlog was flat, inventory levels where flat with 20% reporting a decline.
• Project approval / submittal approval processes are SLOW, and this is delaying some business. Lots of requoting is mentioned as is a very competitive pricing market.
• Price increases moderated to low single digits.

Lighting Rays of Hope for 2026?

We asked about 2026 and there appear to be some light at the end of the tunnel … or perhaps it is fake optimism. Time will tell.

Outlook

• Manufacturers and distributors were the most optimistic with mid-single digits. Reps / lighting agents are more dour … low single digits (and almost flat)

Key markets for 2026

• Warehousing, Healthcare, Data Centers, Office Retrofits, Municipal / State government and K-12.

Key initiatives

• Value-engineering, Lighting controls / smart lighting, focusing on design / build contractors, targeting market segments
• Distributors also mentioned “training staff to support value-engineering.”

While “growth” is forecasted, there isn’t much driving the market other than “fighting for the business.” There is no “tide” to raise all sails. It is “blocking / tackling”, targeting selected areas (and projects) and being the lighting “maven” in your market which means lighting controls knowledge and/or trained staff to VE projects.

Click here to order the complete report for only $35.