ABB unveils $2.3bn robotics spin-off plan—shareholders to receive direct stock in 2026 listing

Why is ABB spinning off its robotics division?

ABB Ltd, the Zurich-headquartered industrial technology giant, has formally announced plans to separate its Robotics division into a newly listed company by the second quarter of 2026. The proposed spin-off, if approved by shareholders at the 2026 Annual General Meeting, will be executed through a share distribution, enabling existing ABB shareholders to receive stock in the new company as a dividend in-kind.

The strategic move is designed to create independent entities with clear sector focus, distinct growth trajectories, and tailored capital strategies. Peter Voser, Chairman of ABB, stated that the separation would optimise both companies’ ability to innovate, attract talent, and create long-term customer value. ABB will concentrate on its dominant areas of electrification and process automation, while the new company—tentatively referred to as ABB Robotics—will operate as a standalone robotics and intelligent automation business.

What makes ABB Robotics a strong candidate for public listing?

ABB Robotics is currently a leader in intelligent automation and advanced robotic systems. Its portfolio includes a wide range of technologies such as Autonomous Mobile Robots, AI-powered platforms, and advanced control software. With a strong emphasis on productivity, flexibility, and sustainable operations, the division serves industries contending with workforce constraints and the push toward carbon reduction.

More than 80% of ABB Robotics’ product suite is software or AI-enabled, supporting modern industrial needs such as adaptive automation, human-robot collaboration, and data-driven control systems. These solutions are increasingly deployed across both traditional manufacturing sectors and emerging tech-driven verticals.

The company maintains a localised manufacturing footprint, with major hubs in Sweden, China, and the United States, following a ‘local-for-local’ strategy aimed at de-risking supply chains and reducing time-to-market. In 2024, ABB Robotics generated $2.3 billion in revenue, contributing around 7% to ABB Group’s overall topline. The unit recorded an Operational EBITA margin of 12.1%, demonstrating consistent profitability under ABB’s decentralised “ABB Way” model.

How does ABB’s spin-off strategy fit within broader market trends?

The decision to spin off the robotics business reflects a growing industry trend among diversified industrial firms to isolate high-growth segments into pure-play entities. As automation technology becomes increasingly software-centric, faster innovation cycles and demand for cross-sector integration have pushed companies like ABB to rethink business structures.

ABB CEO Morten Wierod noted that ABB Robotics has limited technological and market overlap with the Group’s core divisions, which focus on electrification and process systems. Spinning off the robotics unit enables both entities to pursue industry-specific innovation agendas and respond more directly to their respective market dynamics.

ABB Robotics is expected to compete more aggressively with specialised robotics firms such as Fanuc, KUKA, and Yaskawa, particularly in areas like autonomous material handling, collaborative robotics, and smart factory ecosystems.

What changes will follow within ABB post-spin-off?

Upon the separation of ABB Robotics, ABB’s Machine Automation business—currently grouped with Robotics under the Robotics & Discrete Automation segment—will be merged into the Process Automation division. This realignment is designed to consolidate software and control technology synergies, especially in hybrid industrial applications.

Machine Automation is a key player in high-performance solutions based on programmable logic controllers (PLCs), industrial PCs (IPCs), servo motion systems, vision technologies, and industrial transport platforms. The division will remain under the “ABB Way” framework, with strategy execution delegated to the divisional management team.

This internal shift aims to sharpen ABB’s focus on its automation and electrification priorities while aligning complementary technologies for end-to-end industrial integration.

What does the spin-off mean for ABB India?

ABB India Limited confirmed in its April 17 regulatory filing that it will review the global spin-off’s potential implications for its own Robotics and Discrete Automation operations. The company stated that any future decisions regarding its Indian operations would be evaluated in accordance with applicable laws and at an appropriate time.

India continues to be a growing market for advanced manufacturing and digital automation. ABB’s localised operations in the country have been expanding steadily, supported by the government’s “Make in India” initiative and growing industrial digitalisation. If the spin-off model is extended to ABB India in future phases, it could open new investment pathways or support domestic partnerships in AI-enabled automation.

What is the market sentiment on ABB stock amid the spin-off announcement?

Investor sentiment around ABB has remained largely positive following the spin-off news and the release of its Q1 2025 earnings results. ABB shares (trading under ticker ABBN on SIX Swiss Exchange and ABBNY on U.S. OTC markets) closed at $50.82 as of April 17, 2025. The stock has seen a consistent upward trajectory in recent months, with market forecasts suggesting a potential 12-month target of $60.11—an estimated 18.28% upside.

The upbeat sentiment is underpinned by ABB’s stronger-than-expected Q1 results, where operational EBITA climbed 13% to $1.59 billion. Revenue rose by 5%, aided by stable demand across all business areas, despite continued macroeconomic uncertainty. ABB also reiterated its full-year guidance, projecting mid-single-digit revenue growth and a sustained improvement in margin performance.

As part of its ongoing capital return strategy, ABB launched a $1.5 billion share buyback program and declared a dividend of CHF 0.90 per share. These initiatives reflect the company’s healthy cash position and confidence in its long-term growth outlook.

Analysts have issued a consensus “Moderate Buy” rating on ABB, citing the company’s streamlined focus, sector leadership in electrification and process automation, and the value-unlocking potential of the spin-off.

What are the investor implications and potential upsides?

The spin-off offers ABB shareholders direct exposure to the robotics industry, a sector experiencing strong global tailwinds due to labour shortages, AI integration, and demand for precision manufacturing. By listing ABB Robotics as an independent, pure-play entity, ABB is expected to unlock significant embedded value currently masked by its diversified group structure.

For long-term investors, ABB presents an attractive dual-pronged proposition: continued exposure to the company’s steady-performing electrification and automation segments, and potential high-growth upside from ABB Robotics’ standalone journey. The dividend-in-kind structure also ensures that existing shareholders benefit directly from the new listing without dilution or cash outlay.

With the Robotics spin-off slated for Q2 2026, and the reorganisation of internal divisions already in motion, ABB appears to be strategically positioning itself for a future where industrial digitalisation, autonomy, and sustainability intersect.