Netgear’s Asia Pacific business is under growing pressure, with sales falling both in the December quarter and across the full year to December 31, 2025, as the US networking company accelerates a strategic shift away from traditional retail and toward direct-to-consumer sales and subscriptions.

The company, which generates around 12% of its global revenue from the Asia Pacific region, reported quarterly AP sales of US$22.4 million, down from US$23.64 million in the same period a year earlier. Australia remains Netgear’s largest market in the region.

The sharper decline came at the annual level, with Asia Pacific revenues falling from US$90.4 million in 2024 to US$83.9 million in 2025, highlighting sustained weakness in consumer demand.

At the same time, inventory levels in the region have climbed, with Netgear carrying 13 weeks of stock at the end of December, up from 10 weeks a year earlier—an indicator of slowing sell-through in key consumer categories.

The downturn is most pronounced in the connected home segment, where sales in Asia Pacific have been falling for three consecutive years. Netgear’s consumer revenues in the region peaked at US$65.4 million in 2022 before sliding to US$35.7 million by 2024. Consumer sales declined again in 2025, mirroring a broader global slowdown.

Globally, Netgear reported consumer revenues of US$93.1 million, down 8.4% year over year. Excluding sales to service providers, the company said consumer revenues were down approximately 30% year on year.

Despite the revenue decline, Netgear managed to lift consumer margins by 5.4%, helped by a refreshed product lineup and tighter pricing discipline. Chief executive officer CJ Prober said the company’s “good-better-best” strategy was delivering benefits, particularly at the premium end of the market.

“In Consumer, we again saw the benefits of our refreshed product portfolio,” Prober said. “Our WiFi 7 routers and mesh systems performed well.”

Facing ongoing pressure in traditional retail channels, Netgear is now aggressively expanding its direct-to-consumer operations in Australia. The company has rolled out a new website and refreshed branding as part of the push, with local management reallocating marketing spend to drive consumers to buy directly from Netgear rather than through major retailers such as Harvey Norman, JB Hi-Fi and specialist resellers.

Alongside the direct sales push, Netgear is placing increasing emphasis on recurring revenue through subscription services. Led by its Armor security offering, the company ended the year with more than US$40 million in annual recurring revenue.

“While the overall market remained competitive, our portfolio’s breadth and pricing discipline helped us defend share and improve overall segment margins,” Prober said. “With additional improvements to our subscription offerings planned for 2026 and the launch of our eSIM-enabled M7 mobile hotspot, we remain focused on further expanding our non-device revenue streams.”

The shift signals a significant change in Netgear’s go-to-market strategy in Australia, as the company looks to offset declining consumer hardware sales by cutting out retail middlemen and building higher-margin, recurring revenue streams.