UBS: The wave of investment in warehouse automation is poised to begin. CGNX.US (CGNX.US) is expected to be a big winner

The Zhitong Finance App learned that the latest survey data from UBS Evidence Lab (UBS Evidence Lab) shows that global warehousing automation spending is expected to accelerate, driven by technological advances and rising labor costs. The survey results show that automation equipment suppliers will face significant opportunities, and machine vision company CGNX.US (CGNX.US) will be the main beneficiary.

UBS's sixth global warehouse automation business survey covered 130 decision makers in North America, Europe, and Asia Pacific. According to the survey results, nearly two-thirds of respondents plan to increase capital expenses for warehouse and distribution center automation over the next year, with an average budget increase of 5%. Retailers and e-commerce companies are leading the way in terms of short-term spending intentions, but wholesalers and manufacturers seem more optimistic about the outlook for the next three years.

UBS analyst Damian Karas said that the warehouse automation sector is still showing a structural growth trend. Currently, the market is not saturated, and he expects a large-scale wave of automation investment by the end of this decade.

Demand for machine vision is growing at an accelerated pace

Research shows that advanced machine vision technology is developing strongly. This technology is essential for automated operations such as bar code reading, quality inspection, and item recognition in logistics environments. More than half (56%) of respondents expect to increase their investment in machine vision tools next year, up from previous survey results.

Although 62% of respondents have used some kind of image-based barcode scanning method, only 36% of the warehouse space uses advanced machine vision technology, which indicates there is still plenty of room for expansion.

Cognex, a leader in machine vision, was named the supplier of choice for future deployments. Datalogic and Zebra Technology (ZBRA.US) are still the most widely used machine vision and bar code scanning suppliers, and Zebra's brand position in the mobile robot field is still stable.

Mobile robots are widely used

Mobile robots, particularly autonomous mobile robots (AMRs), are rapidly gaining popularity as companies seek flexible automation solutions to avoid high fixed infrastructure costs. Up to 91% of respondents said they have used or plan to use mobile robots, a significant increase from previous surveys.

Among AMR suppliers, Honeywell (HON.US)'s Intelligrated business is at the top in terms of customer considerations, while Fetch Robotics, a subsidiary of Zebra Technology, is at a moderate level. European automation companies continue to dominate the market penetration rate, but the rise in Intelligrated's position indicates that the competitiveness of American suppliers is also growing.

Karas said the rising usage of AMRs is due to their flexibility, adding that businesses want to achieve automation that doesn't need to be fixed to the floor.

Which stocks are worth watching?

UBS believes the survey supports warehouse automation stocks in general, and Cognex in particular because the company is leading the way in evaluating machine vision suppliers.

Zebra technology has shown strong brand strength in both bar code scanning and mobile robotics, while Symbotic (SYM.US) appears to be facing difficulties and is the worst performer among potential new vendors. Honeywell's performance was mixed: the company's usage rate declined compared to previous survey results, but future customer demand for its automation and AMR products increased.

Karas said that although Honeywell has seen encouraging signs in the field of warehouse automation, this business segment still accounts for a relatively small share of Honeywell's overall business.

Honeywell announced a major restructuring plan this year to split itself into three independent listed companies focusing on the fields of automation, aerospace, and advanced materials. The plan, which is expected to be completed by mid-2026, aims to streamline operations and strengthen the strategic priorities of each business.

The wave of automation is poised to begin

Despite the company's desire to increase investment, UBS said that automation applications in the entire industry are still limited, leaving plenty of room for future development. UBS anticipates that rising labor costs, artificial intelligence optimization, and e-commerce logistics demand will continue to drive investment by 2030.

The survey also showed that there is growing interest in AI-based warehouse layout optimization tools and digital twin technology, and Intelligrated received good reviews from respondents evaluating these advanced solutions.

Overall, UBS has a positive view of the warehousing automation industry, and is particularly optimistic about companies with favorable positions in high-growth segments such as machine vision and mobile robots, such as Cognex and Zebra Technology.