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Advantech Reports New Organizational Strategy, Return to Growth

ControlDesign.com
10/30/2009

Few businesses emerged unscathed from the Great Recession, but for industrial automation and embedded systems supplier Advantech, happier times are on the horizon, according to Chaney Ho, Advantech managing director for greater China.

"If you ask me 'Is the crisis over?' my answer is 'Yes!'" Ho said, addressing some 800 attendees of the company's World Partner Conference this week in Suzhou, China. In fact, the first calendar quarter of 2009 was Advantech's low point, Ho said, and growth has been accelerating since then. Indeed, since that Q1 nadir, quarter-over-quarter growth has marked 4%, 8% and a forecasted 15% to round out the year.

Advantech's global reach has continued to diversify, Ho reported, with the Chinese market now accounting for only 26% of revenues. The U.S. market, which at 26% is now on par with China, "has the opportunity to become our number one market," Ho said. Europe accounts for 15% of sales, with the rest of the world at 33%. Ho also reported a recent IMS study that put Advantech at number one in worldwide industrial PC market share.

For continued growth, Ho pointed to robust investment in power and energy infrastructure—especially in wind and solar technologies—as well as transportation systems in China. Worldwide, the company's target vertical markets also include medical systems, factory and machine automation, industrial mobile (in vehicle) computing, and retail/hospitality/self-service applications. The overall PC market also will benefit from the recent introduction of Microsoft's Windows 7 operating system platform, which has pushed 2010 shipment projections for PCs to 300 million, "with strong growth projected for the industrial market, too."

In order to better capitalize on its diverse market opportunities, Advantech is reorganizing into two major businesses: One focused on its embedded, "design-in" activities, and the other on its branded products and solutions activities, said KC Liu, Advantech CEO. The company's "Trusted ePlatform Services" mission is now more narrowly applied to the embedded business, with a new "Enabling a Smarter Planet" tagline for its Advantech branded products and vertically focused solutions. The reorganization is designed to "support our next stage of growth and market leadership," Liu said.

Drawing on IBM's Smarter Planet vision of increasingly instrumented, interconnected and intelligent devices and systems, Liu explained that Advantech's vision is to help enable that transformation. "Crossover collaboration" among Advantech and its clients and partners will be necessary to achieve a smarter planet, Lui added. "We will rely on each other and empower each other."