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Aterian Reports First Quarter 2023 Results

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Reports First Quarter 2023 Net Revenue of $34.9 Million

Announces Headcount Reduction Geared to Achieve Adjusted EBITDA Profitability Target

NEW YORK, May 09, 2023 (GLOBE NEWSWIRE) — Aterian, Inc. (Nasdaq: ATER) (“Aterian” or the “Company”) today announced results for the first quarter ended March 31, 2023. 

First Quarter Highlights

  • First quarter 2023 net revenue declined 16.3% to $34.9 million, compared to $41.7 million in the first quarter of 2022.
  • First quarter 2023 gross margin declined to 54.8%, compared to 56.6% in the first quarter of 2022, primarily reflecting the impact of our strategy of liquidating high-cost inventory.
  • First quarter 2023 contribution margin declined to 5.9% from 9.2% in the first quarter of 2022, primarily reflecting the impact of our strategy of liquidating high-cost inventory.
  • First quarter 2023 operating loss improved to $(25.0) million compared to a loss of $(36.3) million in the first quarter of 2022. First quarter 2023 operating loss includes ($2.3) million of non-cash stock compensation and a non-cash loss on impairment of intangibles of ($16.7) million, while first quarter 2022 operating loss included a gain of $2.8 million from the net change in fair value and settlement of earn-out liabilities, ($29.0) million of impairment loss on goodwill, and ($2.9) million of non-cash stock compensation.
  • First quarter 2023 net loss of $(25.8) million decreased from $(42.8) million loss in the first quarter of 2022. First quarter 2023 net loss includes ($2.3) million of non-cash stock compensation, a non-cash loss on impairment of intangibles of ($16.7) million, and a gain on fair value of warrant liability of $0.4 million, while first quarter 2022 net loss included a gain of $2.8 million from the net change in fair value and settlement of earn-out liabilities, ($29.0) million of impairment loss on goodwill, and ($2.9) million of non-cash stock compensation, a gain on extinguishment of debt of $2.0 million and ($7.7) million in net charges from the changes in fair-value of warrants and initial issuance of equity.
  • First quarter 2023 adjusted EBITDA loss improved to $(4.3) million from $(4.5) million in the first quarter of 2022.
  • Total cash balance at March 31, 2023 was $33.9 million.

“Despite weakness in consumer demand, we are continuing to execute on our goal of becoming adjusted EBITDA profitable in the second half of this year,” commented Yaniv Sarig, Co-Founder and Chief Executive Officer of Aterian. “To that end today we announced a headcount reduction that will save an annualized $6 million toward our target of adjusted EBITDA profitability. It is a difficult decision but one that will put Aterian on a better footing with a solid balance sheet. This cost savings coupled with our portfolio’s market share position will allow us to build forward with emphasis and focus on both growth and profitability.”

Headcount Reduction

The Company plans to reduce expenses by implementing a reduction in its current workforce leading to approximately $6.0 million of annualized savings. This headcount reduction will impact approximately 70 employees and 30 contractors, primarily in the Philippines. The reduction in headcount is part of the Company’s strategy to increase efficiency and to drive focus as part of its second half 2023 adjusted EBITDA profitability goal. The Company expects to substantially complete the reduction in headcount by the end of the second quarter of 2023. The Company expects to recognize restructuring charges in connection with the headcount reduction plan, primarily from severance, of between $1.0 million to $1.3 million. The Company expects the charges will be recognized primarily in the second quarter of 2023, with the majority of such charges anticipated to be paid by the end of the third quarter of 2023.

As part of this headcount reduction, our Chief Supply Chain Officer, Michal Chaouat-Fix, will be transitioning away from the Company. Arturo Rodriguez, our Chief Financial Officer, will also assume the additional responsibilities of supply chain and operations as our Interim Chief Operating Officer. In addition, Tim Stanton, our Chief E-Commerce Officer, will transition away from the Company, Phil Lepper, our Senior Vice President of Revenue will assume Tim’s responsibilities.

Second Quarter 2023 & Second Half of 2023 Outlook

For the second quarter of 2023, taking into account the current global environment and inflation, we believe that net revenue will be between $37 million and $44 million. For the second quarter of 2023, the Company expects an Adjusted EBITDA loss of between $(5.2) million to $(6.2) million including the restructuring charges from our headcount reductions.

As a result of the headcount reduction, the Company is reconfirming its prior guidance of expecting to be Adjusted EBITDA profitable in the second half of 2023.

Non-GAAP Financial Measures

For more information on our non-GAAP financial measures and a reconciliation of GAAP to non-GAAP measures, please see the “Non-GAAP Financial Measures” section below. The most directly comparable GAAP financial measure for EBITDA and Adjusted EBITDA is net loss and we expect to report a net loss for the three months ending March 31, 2023 and the second half of 2023, due primarily to interest expense and stock-based compensation expense. We are unable to reconcile the forward-looking statements of EBITDA and Adjusted EBITDA in this press release to their nearest GAAP measures because the nearest GAAP financial measures are not accessible on a forward-looking basis and reconciling information is not available without unreasonable effort.

Webcast and Conference Call Information

Aterian will host a live conference call to discuss financial results today, May 9, 2023, at 5:00 p.m. Eastern Time, which will be accessible by telephone and the internet. To access the call, participants from within the U.S. should dial (833) 636-1351 and participants from outside the U.S. should dial (412) 902-4267 and ask to be joined into the Aterian, Inc. call. Participants may also access the call through a live webcast at https://ir.aterian.io. The archived online replay will be available for a limited time after the call in the Investors Relations section of the Aterian website.

About Aterian, Inc.

Aterian, Inc. (Nasdaq: ATER), is a leading technology-enabled consumer products platform that builds, acquires, and partners with best-in-class e-commerce brands by harnessing proprietary software and an agile supply chain to create top selling consumer products. The Company’s cloud-based platform, Artificial Intelligence Marketplace Ecommerce Engine (AIMEE™), leverages machine learning, natural language processing and data analytics to streamline the management of products at scale across the world’s largest online marketplaces, including Amazon, Shopify and Walmart. Aterian has numerous owned and operated brands and sells products in multiple categories, including home and kitchen appliances, health and wellness, beauty and consumer electronics.

Forward Looking Statements

All statements other than statements of historical facts included in this press release that address activities, events or developments that we expect, believe or anticipate will or may occur in the future are forward-looking statements including, in particular, the statements regarding our goal to achieve adjusted EBITDA profitability in the second half of 2023, our portfolio’s market share position and the Company’s strategy of increasing efficiency and driving focus. These forward-looking statements are based on management’s current expectations and beliefs and are subject to a number of risks and uncertainties and other factors, all of which are difficult to predict and many of which are beyond our control and could cause actual results to differ materially and adversely from those described in the forward-looking statements. These risks include, but are not limited to, those related to the global shipping disruptions, our ability to continue as a going concern, our ability to meet financial covenants with our lenders, our ability to create operating leverage and efficiency when integrating companies that we acquire, including through the use of our team’s expertise, the economies of scale of our supply chain and automation driven by our platform; those related to our ability to grow internationally and through the launch of products under our brands and the acquisition of additional brands; those related to the impact of COVID-19, including its impact on consumer demand, our cash flows, financial condition, forecasting and revenue growth rate; our supply chain including sourcing, manufacturing, warehousing and fulfillment; our ability to manage expenses, working capital and capital expenditures efficiently; our business model and our technology platform; our ability to disrupt the consumer products industry; our ability to maintain and to grow market share in existing and new product categories; our ability to continue to profitably sell the SKUs we operate; our ability to generate profitability and stockholder value; international tariffs and trade measures; inventory management, product liability claims, recalls or other safety and regulatory concerns; reliance on third party online marketplaces; seasonal and quarterly variations in our revenue; acquisitions of other companies and technologies and our ability to integrate such companies and technologies with our business; our ability to continue to access debt and equity capital (including on terms advantageous to the Company) and the extent of our leverage; and other factors discussed in the “Risk Factors” section of our most recent periodic reports filed with the Securities and Exchange Commission (“SEC”), all of which you may obtain for free on the SEC’s website at www.sec.gov.

Although we believe that the expectations reflected in our forward-looking statements are reasonable, we do not know whether our expectations will prove correct. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof, even if subsequently made available by us on our website or otherwise. We do not undertake any obligation to update, amend or clarify these forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required under applicable securities laws.

Investor Contact:

Ilya Grozovsky
Director of Investor Relations & Corp. Development
Aterian, Inc.
[email protected]
917-905-1699 
aterian.io

ATERIAN, INC.


Consolidated Balance Sheets
(in thousands, except share and per share data)

    December 31,
2022
  March 31,
2023
ASSETS        
Current assets:        
Cash   $ 43,574   $ 33,911
Accounts receivable, net   4,515   3,486
Inventory   43,666   40,378
Prepaid and other current assets   8,261   6,870
Total current assets   100,016   84,645
Property and equipment, net   853   830
Other intangibles, net   54,757   36,392
Other non-current assets   813   753
Total assets   $ 156,439   $ 122,620
LIABILITIES AND STOCKHOLDERS’ EQUITY        
Current Liabilities:        
Credit facility   $ 21,053   $ 19,103
Accounts payable   16,035   8,955
Seller notes   1,693   1,303
Accrued and other current liabilities   14,254   13,045
Total current liabilities   53,035   42,406
Other liabilities   1,452   1,447
Total liabilities   54,487   43,853
Commitments and contingencies (Note 9)        
Stockholders’ equity:        
Common stock, $0.0001 par value, 500,000,000 shares authorized and 80,752,290 and 81,134,161 shares outstanding at December 31, 2022 and March 31, 2023, respectively   8   8
Additional paid-in capital   728,339   730,825
Accumulated deficit   (625,251)   (651,051)
Accumulated other comprehensive loss   (1,144)   (1,015)
Total stockholders’ equity   101,952   78,767
Total liabilities and stockholders’ equity   $ 156,439   $ 122,620
ATERIAN, INC.
Consolidated Statements of Operations
(in thousands, except share and per share data)
    Three Months Ended March 31,
    2022   2023
Net revenue   $ 41,673   $ 34,879
Cost of good sold   18,066   15,782
Gross profit   23,607   19,097
Operating expenses:        
Sales and distribution   22,974   20,226
Research and development   1,144   1,247
General and administrative   9,541   5,959
Impairment loss on goodwill   29,020  
Impairment loss on intangibles     16,660
Change in fair value of contingent earn-out liabilities   (2,775)  
Total operating expenses   59,904   44,092
Operating loss   (36,297)   (24,995)
Interest expense, net   802   371
Gain on extinguishment of seller note   (2,012)  
Loss on initial issuance of equity   5,835  
Change in fair value of warrant liability   1,879   354
Other (income) expense, net   (25)   54
Loss before income taxes   (42,776)   (25,774)
Provision for income taxes     26
Net loss   $ (42,776)   $ (25,800)
Net loss per share, basic and diluted   $ (0.78)   $ (0.34)
Weighted-average number of shares outstanding, basic and diluted   55,141,448   76,732,539
ATERIAN, INC.
Consolidated Statements of Cash Flows
(in thousands)
    Three Months Ended March 31,
    2022   2023
OPERATING ACTIVITIES:        
Net loss   ($42,776)   ($25,800)
Adjustments to reconcile net loss to net cash used in operating activities:        
Depreciation and amortization   1,846   1,762
Provision for (recovery of) sales returns   109   (223)
Amortization of deferred financing cost and debt discounts   106   106
Stock-based compensation   2,865   2,317
Gain from decrease of contingent earn-out liability fair value   (2,775)  
Change in inventory provisions     (1,023)
Loss in connection with the change in warrant fair value   1,879   354
Gain in connection with settlement of note payable   (2,012)  
Loss on initial issuance of equity   5,835  
Impairment loss on goodwill   29,020  
Impairment loss on intangibles     16,660
Changes in assets and liabilities:        
Accounts receivable   4,608   1,028
Inventory   (12,380)   4,312
Prepaid and other current assets   410   751
Accounts payable, accrued and other liabilities   95   (7,661)
Cash used in operating activities   (13,170)   (7,417)
INVESTING ACTIVITIES:        
Purchase of fixed assets   (16)   (33)
Purchase of Step and Go assets     (125)
Cash used in investing activities   (16)   (158)
FINANCING ACTIVITIES:        
Proceeds from equity offering, net of issuance costs   27,007  
Repayments on note payable to Smash   (1,084)   (398)
Borrowings from MidCap credit facilities   30,357   20,549
Repayments for MidCap credit facilities   (33,845)   (22,602)
Insurance obligation payments   (719)   (534)
Cash provided (used) by financing activities   21,716   (2,985)
Foreign currency effect on cash, cash equivalents, and restricted cash   (171)   129
Net change in cash and restricted cash for the year   8,359   (10,431)
Cash and restricted cash at beginning of year   38,315   46,629
Cash and restricted cash at end of year   $ 46,674   $ 36,198
RECONCILIATION OF CASH AND RESTRICTED CASH:        
Cash   44,281   33,911
Restricted Cash—Prepaid and other current assets   2,264   2,158
Restricted cash—Other non-current assets   129   129
TOTAL CASH AND RESTRICTED CASH   $ 46,674   $ 36,198
         
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION        
Cash paid for interest   $ 357   $ 538
NON-CASH INVESTING AND FINANCING ACTIVITIES:        
Non-cash consideration paid to contractors   $ —   $ 321
Fair value of warrants issued in connection with equity offering   $ 18,982   $ —
Issuance of common stock for settlement of seller note   $ 767   $ —
Equity fundraising cost not paid   $ 166   $ —
         

Non-GAAP Financial Measures

We believe that our financial statements and the other financial data included in this Quarterly Report have been prepared in a manner that complies, in all material respects, with generally accepted accounting principles in the U.S. (“GAAP”). However, for the reasons discussed below, we have presented certain non-GAAP measures herein.

We have presented the following non-GAAP measures to assist investors in understanding our core net operating results on an on-going basis: (i) Contribution Margin; (ii) Contribution margin as a percentage of net revenue; (iii) EBITDA (iv) Adjusted EBITDA; and (v) Adjusted EBITDA as a percentage of net revenue. These non-GAAP financial measures may also assist investors in making comparisons of our core operating results with those of other companies.

As used herein, Contribution margin represents gross profit less e-commerce platform commissions, online advertising, selling and logistics expenses (included in sales and distribution expenses). As used herein, Contribution margin as a percentage of net revenue represents Contribution margin divided by net revenue. As used herein, EBITDA represents net loss plus depreciation and amortization, interest expense, net and provision for income taxes. As used herein, Adjusted EBITDA represents EBITDA plus stock-based compensation expense, changes in fair-market value of earn-outs, profit and loss impacts from the issuance of common stock and/or warrants, changes in fair-market value of warrant liability, litigation settlements, impairment on goodwill and intangibles, gain from extinguishment of debt and other expenses, net. As used herein, Adjusted EBITDA as a percentage of net revenue represents Adjusted EBITDA divided by net revenue. Contribution margin, EBITDA and Adjusted EBITDA do not represent and should not be considered as alternatives to loss from operations or net loss, as determined under GAAP.

We present Contribution margin and Contribution margin as a percentage of net revenue, as we believe each of these measures provides an additional metric to evaluate our operations and, when considered with both our GAAP results and the reconciliation to gross profit, provides useful supplemental information for investors. Specifically, Contribution margin and Contribution margin as a Non-GAAP Financial Measure percentage of net revenue are two of our key metrics in running our business. All product decisions made by us, from the approval of launching a new product and to the liquidation of a product at the end of its life cycle, are measured primarily from Contribution margin and/or Contribution margin as a percentage of net revenue. Further, we believe these measures provide improved transparency to our stockholders to determine the performance of our products prior to fixed costs as opposed to referencing gross profit alone.

In the reconciliation to calculate contribution margin, we add e-commerce platform commissions, online advertising, selling and logistics expenses (“sales and distribution variable expense”) to gross profit to inform users of our financial statements of what our product profitability is at each period prior to fixed costs (such as sales and distribution expenses such as salaries as well as research and development expenses and general administrative expenses). By excluding these fixed costs, we believe this allows users of our financial statements to understand our products performance and allows them to measure our products performance over time.

We present EBITDA, Adjusted EBITDA and Adjusted EBITDA as a percentage of net revenue because we believe each of these measures provides an additional metric to evaluate our operations and, when considered with both our GAAP results and the reconciliation to net loss, provide useful supplemental information for investors. We use these measures with financial measures prepared in accordance with GAAP, such as sales and gross margins, to assess our historical and prospective operating performance, to provide meaningful comparisons of operating performance across periods, to enhance our understanding of our operating performance and to compare our performance to that of our peers and competitors. We believe EBITDA, Adjusted EBITDA and Adjusted EBITDA as a percentage of net revenue are useful to investors in assessing the operating performance of our business without the effect of non-cash items.

Contribution margin, Contribution margin as a percentage of net revenue, EBITDA, Adjusted EBITDA and Adjusted EBITDA as a percentage of net revenue should not be considered in isolation or as alternatives to net loss, loss from operations or any other measure of financial performance calculated and prescribed in accordance with GAAP. Neither EBITDA, Adjusted EBITDA or Adjusted EBITDA as a percentage of net revenue should be considered a measure of discretionary cash available to us to invest in the growth of our business. Our Contribution margin, Contribution margin as a percentage of net revenue, EBITDA, Adjusted EBITDA and Adjusted EBITDA as a percentage of net revenue may not be comparable to similar titled measures in other organizations because other organizations may not calculate Contribution margin, Contribution margin as a percentage of net revenue, EBITDA, Adjusted EBITDA or Adjusted EBITDA as a percentage of net revenue in the same manner as we do. Our presentation of Contribution margin and Adjusted EBITDA should not be construed as an inference that our future results will be unaffected by the expenses that are excluded from such terms or by unusual or non-recurring items.

We recognize that EBITDA, Adjusted EBITDA and Adjusted EBITDA as a percentage of net revenue, have limitations as analytical financial measures. For example, neither EBITDA nor Adjusted EBITDA reflects:

  • our capital expenditures or future requirements for capital expenditures or mergers and acquisitions;
  • the interest expense or the cash requirements necessary to service interest expense or principal payments, associated with indebtedness;
  • depreciation and amortization, which are non-cash charges, although the assets being depreciated and amortized will likely have to be replaced in the future, or any cash requirements for the replacement of assets;
  • changes in cash requirements for our working capital needs; or
  • changes in fair value of contingent earn-out liabilities, warrant liabilities, and amortization of inventory step-up from acquisitions (included in cost of goods sold).

Additionally, Adjusted EBITDA excludes non-cash expense for stock-based compensation, which is and is expected to remain a key element of our overall long-term incentive compensation package.

We also recognize that Contribution margin and Contribution margin as a percentage of net revenue have limitations as analytical financial measures. For example, Contribution margin does not reflect:

  • general and administrative expense necessary to operate our business;
  • research and development expenses necessary for the development, operation and support of our software platform;
  • the fixed costs portion of our sales and distribution expenses including stock-based compensation expense; or
  • changes in fair value of contingent earn-out liabilities, warrant liabilities, and amortization of inventory step-up from acquisitions (included in cost of goods sold).

Contribution Margin

The following table provides a reconciliation of Contribution margin to gross profit and Contribution margin as a percentage of net revenue to gross profit as a percentage of net revenue, which are the most directly comparable financial measures presented in accordance with GAAP:

    Three Months Ended March 31,
    2022   2023
         
    (in thousands, except percentages)
Gross Profit   $ 23,607   $ 19,097
Less:        
E-commerce platform commissions, online advertising, selling and logistics expenses   (19,777)   (17,029)
Contribution margin   $ 3,830   $ 2,068
Gross Profit as a percentage of net revenue   56.6%   54.8%
Contribution margin as a percentage of net revenue   9.2%   5.9%
 

Adjusted EBITDA

The following table provides a reconciliation of EBITDA and Adjusted EBITDA to net loss, which is the most directly comparable financial measure presented in accordance with GAAP:

    Three Months Ended March 31,
    2022   2023
Net loss   $ (42,776)   $ (25,800)
Add:        
Provision for income taxes     26
Interest expense, net   802   371
Depreciation and amortization   1,846   1,762
EBITDA   (40,128)   (23,641)
Other (income) expense, net   (25)   54
Change in fair value of contingent earn-out liabilities   (2,775)  
Impairment loss on goodwill   29,020  
Impairment loss on intangibles     16,660
Gain on extinguishment of seller note   (2,012)  
Change in fair market value of warrant liability   1,879   354
Loss on original issuance of equity   5,835  
Litigation reserve   800  
Stock-based compensation expense   2,865   2,317
Adjusted EBITDA   $ (4,541)   $ (4,256)
Net loss as a percentage of net revenue   (102.6)%   (74.0)%
Adjusted EBITDA as a percentage of net revenue   (10.9)%   (12.2)%
         

Each of our products typically goes through the Launch phase and depending on its level of success is moved to one of the other phases as further described below:

i. Launch phase: During this phase, we leverage our technology to target opportunities identified using AIMEE (Artificial Intelligence Marketplace e-Commerce Engine) and other sources. This phase also includes revenue from new product variations and relaunches. During this period of time, due to the combination of discounts and investment in marketing, our net margin for a product could be as low as approximately negative 35%. Net margin is calculated by taking net revenue less the cost of goods sold, less fulfillment, online advertising and selling expenses. These primarily reflect the estimated variable costs related to the sale of a product.

ii. Sustain phase: Our goal is for every product we launch to enter the sustain phase and become profitable, with a target of positive 15% net margin for most products, within approximately three months of launch on average. Net margin primarily reflects a combination of manual and automated adjustments in price and marketing spend.

iii. Liquidate phase: If a product does not enter the sustain phase or if the customer satisfaction of the product (i.e., ratings) is not satisfactory, then it will go to the liquidate phase and we will sell through the remaining inventory. Products can also be liquidated as part of inventory normalization especially when steep discounts are required.

The following tables break out our first quarter of 2022 and 2023 results of operations by our product phases (in thousands):

    Three months ended March 31, 2022
    Sustain   Launch   Liquidation/
Other
  Fixed Costs   Stock Based Compensation   Total
Net revenue   $ 37,964   $ 837   $ 2,872   $ —   $ —   $ 41,673
Cost of goods sold   15,749   411   1,906       18,066
Gross profit   22,215   426   966       23,607
Operating expenses:                        
Sales and distribution expenses   17,479   535   1,762   2,851   347   22,974
Research and development         870   274   1,144
General and administrative         7,217   2,324   9,541
Impairment loss on goodwill         29,020     29,020
Change in earn-out liability         (2,775)     (2,775)
    Three months ended March 31, 2023
    Sustain   Launch   Liquidation/
Other
  Fixed Costs   Stock Based Compensation   Total
Net revenue   $ 28,631   $ 158   $ 6,090   $ —   $ —   $ 34,879
Cost of goods sold   11,678   92   4,012       15,782
Gross profit   16,953   66   2,078       19,097
Operating expenses:                        
Sales and distribution expenses   13,353   119   3,557   2,526   671   20,226
Research and development         813   434   1,247
General and administrative         4,747   1,212   5,959
Impairment loss on intangibles         16,660     16,660

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Artificial Intelligence

Predictive Maintenance Market worth $47.8 billion by 2029 – Exclusive Report by MarketsandMarkets™

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Real-time analysis and decision-making will be made easier by developments in AI and IoT integration, which will drive the Predictive Maintenance Market in the future. Innovation will be fueled by prognostics, industry-specific solutions, and interoperability, while Predictive Analytics as a Service (PAaaS) models will make advanced predictive maintenance skills more accessible to all.
CHICAGO, March 29, 2024 /PRNewswire/ — The Predictive Maintenance Market is estimated to grow from USD 10.6 billion in 2024 to USD 47.8 billion in 2029, at a CAGR of 35.1% during the forecast period, according to a new report by MarketsandMarkets™. The driving factors for the Predictive Maintenance Market include the widespread adoption of emerging technologies like IoT sensors and data analytics, enabling real-time monitoring of equipment health. The integration of machine learning (ML) and artificial intelligence (AI) algorithms allows for predictive analysis of potential failures, reducing downtime and optimizing asset performance. Organizations are increasingly focused on cost savings and operational efficiency, driving the need for proactive maintenance strategies to minimize unplanned downtime and maximize productivity. Additionally, regulatory requirements and the shift towards predictive analytics-driven decision-making further contribute to the growth of the Predictive Maintenance Market.

Browse in-depth TOC on “Predictive Maintenance Market”
280 – Tables 60 – Figures300 – Pages
Download PDF Brochure @ https://www.marketsandmarkets.com/pdfdownloadNew.asp?id=8656856
Scope of the Report
Report Metrics
Details
Market size available for years
2019–2029
Base year considered
2023
Forecast period
2024–2019
Forecast units
USD Billion
Segments Covered
Component (Hardware, Solution [Solution by Deployment mode {Cloud (Public, Private, Hybrid) & On-premises}] & Services), Technology (Analytics & Data Management, Artificial Intelligence, IoT Platform, Sensors & Other Devices), Technique (Vibration Analysis, Infrared Thermography, Acoustic Monitoring, Oil Analysis, Motor Circuit Analysis, Other Techniques) Organization size (Large Enterprises, SMEs), Vertical (Energy & Utilities, Manufacturing, Automotive & Transportation, Aerospace & Defense, Construction & Mining, Healthcare, Telecommunications) and Region.
Geographies covered
North America, Europe, Asia Pacific, Middle East & Africa, Latin America
Companies covered
IBM (US), ABB (Switzerland), Schneider Electric (France), AWS (US), Google (US), Microsoft (US), Hitachi (Japan), SAP (Germany), SAS Institute (US), Software AG (Germany), TIBCO Software (US), Altair (US), Oracle (US), Splunk (US), C3.ai (US), Emerson (US), GE (US), Honeywell (US), Siemens (Germany), PTC (US), Dingo (Australia), Uptake (US), Samotics (Netherlands), WaveScan (Singapore), Quadrical Ai (Canada), UpKeep (US), Limble (US), SenseGrow (US), Presage Insights (India), Falcon Labs (India).
By component, the services segment to account for higher CAGR during the forecast period.
The services segment plays a crucial role in the Predictive Maintenance Market, serving as a core component essential for the efficient operation of software solutions. Many companies are turning to intelligent devices, robust AI systems, and Industrial Internet of Things (IIoT) solutions to monitor the health and productivity of critical equipment, aiming to minimize costly production shutdowns. Remote monitoring of machinery and equipment has become a significant priority for organizations grappling with challenges in detecting machinery failures. The adoption of predictive maintenance services, including IoT, has become imperative to mitigate the risks and failures of machines across various industries. Within the services segment, managed and professional services are considered vital for enhancing overall process efficiency.
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By Technique, Vibration Analysis is expected to hold the largest market size for the year 2024.
Vibration analysis is a crucial technique employed primarily for high-speed rotating equipment in predictive maintenance strategies. It enables technicians to monitor the vibrations of machines using handheld analyzers or real-time sensors integrated into the equipment itself. Machines operating optimally exhibit specific vibration patterns, which can be compared against known standards. However, as components like bearings and shafts wear down or develop faults, they generate distinct vibration patterns, signaling potential issues. By continuously monitoring equipment vibrations, trained technicians can identify deviations from normal patterns and diagnose problems early on. The range of issues detectable through vibration analysis is extensive and includes misalignment, bent shafts, unbalanced components, loose mechanical parts, and motor irregularities.
By Vertical, Automotive & Transportation is projected to grow at the highest CAGR during the forecast period.
As automotive technology progresses rapidly, traditional fault detection methods are inadequate for ensuring vehicle smoothness. However, modern automobiles are equipped with various sensors, instruments, and cameras that generate diverse data. Leveraging this data, past service records, and employing AI and ML, predictive maintenance in the automotive & transportation sector emerges as a powerful solution to enhance vehicle performance and minimize downtime. The surge in intelligent technologies has spurred predictive maintenance investments in transportation, particularly accelerated by the Covid-19 crisis, where consumer preferences shifted towards individual mobility due to health and safety concerns, leading to an increased demand for cars. This demand surge, coupled with slowed new vehicle production, is driving the resurgence of the used car market. Predictive maintenance plays a crucial role in reducing the lifespan of used cars and preventing unexpected downtimes. Solutions like IBM’s monitoring for connected vehicles and collaborations between automakers and tech companies like Ford, CARUSO, and HIGH MOBILITY showcase the industry’s commitment to leveraging predictive maintenance for improved operations and customer services.
Middle East & Africa is expected to grow at the second-highest CAGR during the forecast period.
The Middle East & Africa (MEA) lacks technological development as well as primary business growth in many verticals. Slow economic growth and geopolitical conditions are the major hurdles to the growth of the Predictive Maintenance Market in the region. Moreover, it generates the majority of the revenues from natural resources. The government policy in the United Arab Emirates (UAE) is supportive of the industry with the vision to be one of the most technologically advanced nations by 2022. The proliferation of telecom and IT-enabled industry in the African countries is steering the growth of AI-based IoT companies in the region. The major reasons that are said to influence the growth of the Predictive Maintenance Market in the region are the increasing investments in data center infrastructures and the growing number of high-growth start-ups. Only a few countries, such as the UAE, Israel, and Qatar, across the region, are advancing in this market at an economical pace. The UAE, Israel, and Qatar have demonstrated a strong commitment toward the development and implementation of AI and IoT technologies.
Top Key Companies in Predictive Maintenance Market:
The major predictive maintenance hardware, solution and service providers include IBM (US), ABB (Switzerland), Schneider Electric (France), AWS (US), Google (US), Microsoft (US), Hitachi (Japan), SAP (Germany), SAS Institute (US), Software AG (Germany), TIBCO Software (US), Altair (US), Oracle (US), Splunk (US), C3.ai (US), Emerson (US), GE (US), Honeywell (US), Siemens (Germany), PTC (US), Dingo (Australia), Uptake (US), Samotics (Netherlands), WaveScan (Singapore), Quadrical Ai (Canada), UpKeep (US), Limble (US), SenseGrow (US), Presage Insights (India), Falcon Labs (India). These companies have used both organic and inorganic growth strategies such as product launches, acquisitions, and partnerships to strengthen their position in the Predictive Maintenance Market.
Recent Developments:
In January 2024, Siemens and AWS deepened their collaboration to simplify the development and scaling of generative artificial intelligence (AI) applications for businesses across various industries and sizes. This partnership enables domain experts in fields like engineering, manufacturing, logistics, insurance, or banking to leverage advanced generative AI technology to create and enhance applications efficiently.In December 2023, ABB enhanced its ABB Ability Field Information Manager (FIM 3.0) to provide system engineers and maintenance teams with enhanced connectivity and expanded reach across the latest communication protocols.In June 2023, Qatar Airways and Google Cloud partnered to create innovative data and artificial intelligence (AI) solutions tailored for the airline industry. This collaboration will concentrate on enhancing areas like predictive maintenance, passenger experience, and cargo operations, aiming to elevate efficiency and customer satisfaction within the airline sector.In April 2023, TrendMiner launched an updated version of its predictive maintenance software, the Digital Twin Manager. This release includes enhanced support for cloud data sources from AWS and Microsoft, along with interactive search functionality, enabling users to make data-driven decisions more efficiently.In January 2023, AVEVA, a global leader in industrial software, finalized its acquisition by Schneider Electric. AVEVA’s strategic objective is to emerge as the top Software as a Service (SaaS) provider in software and industrial information, transitioning to a subscription-only business model.Inquire Before Buying@ https://www.marketsandmarkets.com/Enquiry_Before_BuyingNew.asp?id=8656856
Predictive Maintenance Market Advantages:
Through proactive equipment maintenance based on data-driven insights, the prevention of expensive unplanned downtime, and the reduction of repair costs, predictive maintenance assists organisations in cutting maintenance costs.Predictive maintenance increases equipment availability and uptime by anticipating possible equipment faults before they happen, guaranteeing continuous operations and maximising output.By locating and resolving underlying problems that may compromise the dependability and efficiency of equipment, predictive maintenance extends the life of assets and lowers the need for untimely replacements.Predictive maintenance reduces the likelihood of mishaps, injuries, and interruptions to operations brought on by malfunctioning equipment by anticipating possible equipment breakdowns.By scheduling maintenance jobs more effectively, predictive maintenance helps businesses minimise interruptions to existing operations and match maintenance duties with production schedules.Using data analytics and machine learning algorithms, predictive maintenance produces actionable insights that help with equipment investments, resource allocation, and maintenance strategy selection.Predictive maintenance ensures continuous functioning and customer satisfaction by proactively addressing equipment concerns, minimising unplanned downtime and production losses.Status-based maintenance techniques, which optimise maintenance resources and cut down on pointless inspections and repairs by triggering maintenance actions based on real-time equipment status data, are made possible by predictive maintenance.Report Objectives
To describe and forecast the Predictive Maintenance Market, in terms of value,by component, technology, technique, organization size, and verticalTo describe and forecast the Predictive Maintenance Market, in terms of value,by region—North America, Europe, Asia Pacific, Middle East & Africa and Latin AmericaTo provide detailed information regarding major factors influencing the market growth (drivers, restraints, opportunities, and challenges)To strategically analyze micromarkets1 with respect to individual growth trends, prospects, and contribution to the overall Predictive Maintenance MarketTo profile key players and comprehensively analyze their market positions in terms of ranking and core competencies2, along with detailing the competitive landscape for market leadersTo analyze competitive developments such as joint ventures, mergers and acquisitions, product developments, and ongoing research and development (R&D) in the Predictive Maintenance MarketTo provide the illustrative segmentation, analysis, and projection of the main regional marketsBrowse Adjacent Markets: Analytics Market Research Reports & Consulting
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AeC Recognized by Frost & Sullivan for Leading the Customer Relationship Industry in Brazil

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AeC is the largest customer relationship company in Brazil and its reliable and customized customer care solutions help businesses create seamless end-user experiences.
SAN ANTONIO, March 29, 2024 /PRNewswire/ — Frost & Sullivan recently researched the customer experience outsourcing services industry and, based on its findings, recognizes AeC with the 2023 Company of the Year Award. AeC is connecting technology with outstanding customer service to increase efficiency and optimize the customer’s business journey. AeC leverages artificial intelligence (AI), data intelligence, machine learning (ML), natural language processing (NLP), fraud prevention, and real human experiences to guarantee an optimal customer experience (CX) in its clients’ business operations.

The company helps businesses deliver a remarkable CX to remain competitive in the marketplace and meet its clients’ demands. It consistently aims to enhance end-user CX by carefully analyzing customer data, testing new business models, and adjusting its processes based on customer feedback.
AeC drives its clients’ digital transformations with innovative tools that provide superior business process outsourcing (BPO) services. The company launched Vision, an advanced and intuitive solution that allows managers to track agents’ performance and deliver effective support. Moreover, its AeC HR technology platform, Robbyson, assists businesses by increasing engagement and efficiency with AI to automatically estimate, suggest, and forecast outcomes.
“With a legacy of BPO services leadership, the company’s compelling value proposition underpins its sustained success. AeC holds a solid position with a diversified client base, serving industry leaders of every market, including four of the top five Brazilian unicorns and two of the top five energy organizations in Brazil,” said Sebastian Menutti, industry principal at Frost & Sullivan.
With its customer-centric approach, the company provides consulting and highly customized projects for its clients. AeC bases its operations on the core principle that its success depends on customer satisfaction. For this reason, the company meets with clients at the pre-sales stage to identify their specific business requirements and challenges to develop tailor-made solutions.
“The company acknowledges that offering a complete product portfolio that aligns with broader market trends (e.g., omnichannel customer services, automation capabilities, and tools that address security challenges) is a key differentiator. Therefore, it constantly leverages technology to improve the efficiency and effectiveness of its services, such as automating processes and using data analytics to gain insights into end users’ behaviors and preferences,” noted Valentina Barcia, best practices research analyst at Frost & Sullivan.
Each year, Frost & Sullivan presents a Company of the Year award to the organization that demonstrates excellence in terms of growth strategy and implementation in its field. The award recognizes a high degree of innovation with products and technologies, and the resulting leadership in terms of customer value and market penetration.
Frost & Sullivan Best Practices awards recognize companies in various regional and global markets for demonstrating outstanding achievement and superior performance in leadership, technological innovation, customer service, and strategic product development. Industry analysts compare market participants and measure performance through in-depth interviews, analyses, and extensive secondary research to identify best practices in the industry.
About Frost & Sullivan
For six decades, Frost & Sullivan has been world-renowned for helping investors, corporate leaders, and governments navigate economic changes and identify disruptive technologies, Mega Trends, new business models, and companies to action, resulting in a continuous flow of growth opportunities to drive future success. Contact us: Start the discussion.
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Kristen MooreP: +1 (210) 247-3823E: [email protected]
About AeC
AeC is a Brazilian technology company specializing in customer relations. Leading by innovation, the most outstanding is the warm way of dealing with people and applying cutting-edge technology in its processes, such as artificial intelligence, cloud services, analytics, and automation tools. For over 30 years, it has developed customized consumer experience solutions in the market, helping companies in different segments, such as digital businesses, fintech, financial sector, telecommunications, services, retail, insurance, energy, and health. Currently, AeC has more than 43,000 employees and is certified by the Great Place to Work Institute (GPTW).
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Actuators Market worth $94.8 billion by 2029 – Exclusive Report by MarketsandMarkets™

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CHICAGO, March 29, 2024 /PRNewswire/ — The Actuators market is estimated at USD 67.7 billion in 2024 and is projected to reach USD 94.8 billion by 2029, at a CAGR of 7.0 % from 2024 to 2029 according to a new report by MarketsandMarkets™. The growth can be attributed to growing industrial automation and use of robots in various sectors like manufacturing and transportation, Developments in areas like sensor technology, connectivity, and control systems, The increasing demand for actuators is fueled by the expansion of sectors like healthcare (medical devices), oil & gas, and aerospace & defense, and the need for improved process control, energy efficiency, and safety regulations in various industries.

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Browse in-depth TOC on “Actuators Market” 300 – Tables175 – Figures350 – Pages
Actuators Market Report Scope:
Report Coverage
Details
Market Revenue in 2024
$ 67.7 billion
Estimated Value by 2029
$ 94.8 billion
Growth Rate
Poised to grow at a CAGR of 7.0%
Market Size Available for
2019–2028
Forecast Period
2023–2028
Forecast Units
Value (USD Million/Billion)
Report Coverage
Revenue Forecast, Competitive Landscape, Growth Factors, and Trends
Segments Covered
By Actuation, Application, Type, Vertical, and Region
Geographies Covered
North America, Europe, Asia Pacific, and Rest of World
Key Market Challenge
Issues of leakage in pneumatic and hydraulic actuators
Key Market Opportunities
Increased spending on renewable sources of energy for power generation
Key Market Drivers
Rapid industrialization and utilization of robotics
The Electric segment held the largest growth rate in the Actuators market by actuation.
By actuation, the Actuators market has been segmented into electric, hydraulic, pneumatic, and others. electric Segment to hold the highest growth rate during the forecast period. Electrical actuators use electricity to produce motion. These actuators can be further classified into solenoid actuators and motor-driven actuators. A solenoid used in an electric actuator works on the principle of electromagnetism. Electrical actuators provide control and acceleration at higher speeds. The force for applying thrust can be managed without the requirement for compressed air and the related infrastructure, and hence the total energy consumption in these actuators is lower. Electrical actuators can be used for various applications where linear as well as rotary actuation is required. They can be used for low torque as well as high torque requirements.
The vehicle equipment segment is expected to account for the largest share of Actuators by application in 2024.
By application, the Actuators industry is segmented into industrial automation, robotics, and vehicle equipment. The vehicles and equipment segment includes actuators used in automotive, aircraft, ships, and defense vehicles. These can be either hydraulic, pneumatic, electrical, or mechanical actuators. Actuators are widely used in various systems and sub-systems of an automobile, aircraft, ships as well as defense vehicles.
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Asia Pacific accounts for the largest market share in 2024.
The Actuators market has been studied in North America, Europe, Asia Pacific, Middle East, and Rest of the World. The Asia Pacific region accounts for the largest market share in 2024 as well as throughout the forecast period due to the increasing demand for actuators in the region to enhance the growth of the market. India is expected to show the highest growth rate in Asia Pacific Region for Actuators market.
Major players operating in the Actuators companies are SMC Corporation (Japan), Rockwell Automation (US), Curtiss-wright Corporation (US), ABB Ltd (Switzerland), and Parker Hennifin Corporation (US).
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Browse Adjacent Market: Aerospace and Defence Market Research Reports & Consulting
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Military Actuators Market by Application (Air, Land, Naval), System (Electrical, Hydraulic, Pneumatic, Mechanical), Component (Cylinders, Drives, Servo Valves, Manifolds), Type (Linear, Rotary), and Region (2019-2024)
Aircraft Actuators Market Size, Share & Industry Growth Analysis Report by Installation Type (OEM & Aftermarket), System, Technology (Hydraulic, Electric Hybrid, Mechanical, Pneumatic, and Full Electric), Type, Platform, Aircraft Type (Fixed Wing and Rotary Wing) and Region – Global Forecast to 2027
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Avionics Market by Platform (Military Aviation, Commercial Aviation, General Aviation, Special Mission Aviation), Fit, Systems and Region (North America, Europe, Asia Pacific, Middle East and Rest of the World) – Global Forecast to 2030
About MarketsandMarkets™
MarketsandMarkets™ has been recognized as one of America’s best management consulting firms by Forbes, as per their recent report.
MarketsandMarkets™ is a blue ocean alternative in growth consulting and program management, leveraging a man-machine offering to drive supernormal growth for progressive organizations in the B2B space. We have the widest lens on emerging technologies, making us proficient in co-creating supernormal growth for clients.
Earlier this year, we made a formal transformation into one of America’s best management consulting firms as per a survey conducted by Forbes.
The B2B economy is witnessing the emergence of $25 trillion of new revenue streams that are substituting existing revenue streams in this decade alone. We work with clients on growth programs, helping them monetize this $25 trillion opportunity through our service lines – TAM Expansion, Go-to-Market (GTM) Strategy to Execution, Market Share Gain, Account Enablement, and Thought Leadership Marketing.
Built on the ‘GIVE Growth’ principle, we work with several Forbes Global 2000 B2B companies – helping them stay relevant in a disruptive ecosystem. Our insights and strategies are molded by our industry experts, cutting-edge AI-powered Market Intelligence Cloud, and years of research. The KnowledgeStore™ (our Market Intelligence Cloud) integrates our research, facilitates an analysis of interconnections through a set of applications, helping clients look at the entire ecosystem and understand the revenue shifts happening in their industry.
To find out more, visit www.MarketsandMarkets™.com or follow us on Twitter, LinkedIn and Facebook.
Contact: Mr. Aashish MehraMarketsandMarkets™ INC. 630 Dundee RoadSuite 430Northbrook, IL 60062USA: +1-888-600-6441Email: [email protected] Our Web Site: https://www.marketsandmarkets.com/Research Insight: https://www.marketsandmarkets.com/ResearchInsight/global-actuators-market.aspContent Source: https://www.marketsandmarkets.com/PressReleases/global-actuators.asp
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