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After earning $80 million in Q1 2021, the good times continued for Teradyne’s industrial automation group in the second quarter. On the backs of Mobile Industrial Robots (MiR) and RBR50 winner Universal Robots (UR), the group’s revenue reached $92 million. That’s a 15% increase Q/Q, a 57% increase Y/Y and a 23% increase from Q2 2019.

UR’s revenue was $76 million for Q2 2021, which is up 15% Q/Q and up 75% Y/Y. MiR earned $16 million, which is up 14% Q/Q and 41% Y/Y and up 51% from Q2 2019. The group’s revenue increased in all regions in Q2 over last year, with North America delivering the highest absolute revenue growth. The U.S. and Europe represented about 77% of the group’s revenue in the quarter, with China contributing about 14%.

“The longer-term outlook in our [industrial automation] business continues to brighten,” said Teradyne vice president and chief financial officer Sanjay Mehta. “We expect continued labor shortages to drive new applications for both our fixed and mobile robots.”

Teradyne expects the group’s revenue to grow about 40% for the year compared to 2020. Along with continued investments in engineering programs, Teradyne is also expanding support for distributors and sales to OEMs that integrate its robots into their products.

Cobots seeing an uptick in welding applications

Teradyne CEO and president Mark Jagiela highlighted UR’s growth in welding applications. After entering the welding market about three years ago, he said welding applications have grown to be about 6% of UR’s global sales. The company is on pace to sell 1,000 cobots into welding applications in 2021, which is more than triple the pace from 2020.

“[Welding] is just one of many job categories with acute short-term and long-term labor shortages,” said Mehta. “Our strategy is to provide an open platform that creative developers can leverage to solve industry-specific labor shortages.”

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Teradyne on The Robot Report Podcast

Greg Smith, president of Teradyne’s industrial automation group, was a recent guest on The Robot Report Podcast. He took us inside the goals and strategy of building Teradyne’s automation portfolio and what Teradyne is looking for in other industrial automation acquisitions.

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AutoGuide continues to reset

There was no mention of AutoGuide Mobile Robots on the earnings call, as the company continues to reset. During its Q1 2021 earnings call, Teradyne lowered its expectations for AutoGuide in 2021, expecting it to generate less than $10 million in revenue for the year.

“We will focus on expanding existing customer deployments while we complete a series of engineering projects designed to scale and win new customers in the future,” Mehta said at the time.

While disputed by Teradyne’s leadership, sources told The Robot Report sales of AutoGuide’s robots were recently halted to make some improvements. As a result, both AutoGuide and Heartland Automation, which is the main integrator of AutoGuide’s robots and the company AutoGuide spun out of, have let employees go.

“No deployments, no need for new integrations,” one source said. “Heartland’s installers and techs were doing nothing but maintaining the current customers, which was too many people.”

Greg Smith, president of Teradyne’s industrial automation group, said AutoGuide hasn’t halted new sales.

“What we saw working with the integrators, some of the business they were bringing in was dependent on new features that weren’t released yet. We wanted to be very disciplined about our commitments and we are focused on delivering the highest quality product.”

Therefore, Smith said AutoGuide has implemented a review process to evaluate new opportunities.

“We continue to add new business that’s not dependent on features that aren’t ready yet. If we’re not sure we have the functionality to support what a potential customer wants, we’re being frank with customers and integrators about where this falls on the priority list.”

He said AutoGuide is “selling what’s on the truck.” He said more than 40 AutoGuide AMRs that were previously sold are on an integration schedule, including at a half dozen places this quarter.

“There are things our system does very well. There are major automakers using AutoGuide AMRs.  There are large consumer product companies using our system, and they’re getting great utility out of them,” Smith said. “We need to find new business that meets those conditions, while building out new capabilities on the back end.”

AutoGuide president and CEO Rob Sullivan resigned on March 1. Tim Moriarty, Teradyne’s president of memory products, stepped into Sullivan’s role. Moriarty previously sold two companies to Teradyne. “He knows how to get what he needs out of Teradyne to scale a business,” Smith said of Moriarty.

How Energid factors in

Teradyne also owns Energid, a Bedford, Mass.-based company specializing in robot control software. Energid wasn’t mentioned in Teradyne’s earnings statement. However, Smith said Energid’s revenue is lumped into UR’s revenue figure.

“The main reason we bought Energid was to expand the total available market (TaM) for collaborative robots. Energid has done this in two ways already. The first was by creating remote TCP, a software add-on for UR. This has driven about 1,000 cobot sales for us. Energid also played a major role in ActiNav’s motion planning and perception capabilities. So Energid is playing a role in our revenue.”

UR won a 2021 RBR50 Robotics Innovation Award for ActiNav as it simplifies machine-loading applications. ActiNav, which launched in April 2020, is a “plug-and-produce” UR+ application kit that makes it easier to deploy collaborative robots for common applications.

UR recently launched a U.S. tour for ActiNav and named a select group of integrators to deploy the system across the country.

You can listen to Teradyne’s Q2 earnings call here and read a transcript of the call here.

Editor’s Note: This article was updated on August 4 at 12:20 PM ET with commentary from Greg Smith, president of Teradyne’s industrial automation group.