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ABB Group, a key player in the realm of industrial automation, has announced a strategic move towards greater independence by planning to spin off its entire robotics division. The Zurich-based entity aims to have this division begin trading as a standalone entity in the second quarter of 2026.
During the company’s earnings call for the first quarter of 2025, CEO Martin Wierod emphasized the significance of this transition, stating, “Today, we also announced our plan to spin off the Robotics division as a separately listed company. In overview, this change will support value creation for both companies.” He also highlighted the growth in orders from the automotive sector and noted that ABB’s paint technology remains highly competitive in the market.
Wierod remarked on the operational performance, mentioning improvements in EBITDA margins across three of the company’s four business areas, despite a decline in the robotics sector compared to the previous year. He pointed out that robotics displayed a positive sequential development, with the machine automation division achieving a break-even status.
Transition of Machine Automation Division
ABB, which boasts a legacy of over 140 years and a global workforce of around 110,000 employees, continues to be a forefront technology leader in electrification and automation solutions that address critical demands such as labor shortages, safety, and enhanced productivity. Nonetheless, the company reported growth that fell short of expectations and identified macroeconomic factors, including tariffs, that have influenced its operations.
For the first quarter of 2025, ABB’s revenue prediction missed the mark by $260 million, and while sales in the robotics segment saw a decline year-over-year, the company remains confident in its ability to retain clients.
The Machine Automation division, which is presently under the Robotics & Discrete Automation unit, will transition to the Process Automation segment by early 2026. This division is recognized as a leading provider of programmable logic controllers (PLCs), intelligent pump controls (IPCs), and various software products.
In contrast, ABB’s sectors focused on Electrification and Motion will not be impacted by the upcoming spinoff.
According to ABB Chairman Peter Voser, listing ABB Robotics independently aims to enhance both entities’ capability to deliver customer value, foster growth, and attract talent. He noted that it would lead to more focused governance and capital allocation, allowing ABB to commit fully to its long-term objectives in electrification and automation.
ABB Robotics’ Market Standing
ABB Robotics currently holds the position of the second-largest player in the global market, generating $2.3 billion in revenues for 2024. Wierod indicated that this new structure would better position ABB Robotics to compete directly with its peers, as synergies with other ABB divisions are limited due to differing market demands.
Other prominent firms in the automation sector include Japan’s FANUC, Mitsubishi, and Denso, along with Stäubli from Switzerland and KUKA from Germany (sovereign to China’s Midea Group). It’s worth noting that no leading industrial robotics companies are based in the United States.
ABB referenced its decentralized “ABB Way” business model, which has facilitated consistent double-digit profit margins for the robotics division since 2019. Recent observations suggest that the market has stabilized, aiding in the growth of divisional orders after a volatile phase marked by supply chain constraints.
The robotics division’s offerings cover a comprehensive array of industrial robots, collaborative robot arms, and autonomous mobile robots (AMRs), following the acquisition of ASTI in 2021. Last year, ABB expanded its modular IRB lineup and acquired Sevensense, enhancing navigation capabilities for its AMRs, rebranded under the name Flexly.
In line with industry trends, ABB has increasingly focused on software and artificial intelligence, claiming that over 80% of its product suite is software or AI-enabled. Recently, it introduced the RoboMasters training tool.
Following the spinoff, ABB Robotics will maintain regional manufacturing hubs located in Sweden, China, and the United States. The company plans to invest $20 million in expanding its American production capabilities in 2023.
Currently employing around 7,000 individuals, ABB Robotics operates its U.S. office from Auburn Hills, Michigan. The $2.3 billion in revenues for 2024 accounted for roughly 7% of ABB Group’s total revenue, with an operational EBITA margin of 12.1%.
If approved by ABB shareholders, the spinoff will take place through a share distribution, providing existing shareholders of ABB Ltd. with shares in the newly established company, provisionally named “ABB Robotics,” as a form of dividend in-kind.
The Robot Report has been in contact with ABB and will provide additional updates as they arise. ABB Robotics is widely recognized for its innovation, consistently ranking among the top RBR50 winners throughout the award’s history. Further details about the sector will be showcased at the upcoming Robotics Summit & Expo happening later this month.
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