Publicly traded enterprise technology company Zebra Technologies Corp. today announced that it’s buying Antuit.ai Inc., whose artificial intelligence software helps retailers and manufacturers forecast customer demand for their products.

Zebra Technologies is buying Antuit.ai from a consortium led by Goldman Sachs Group Inc.’s Asset Management Group. The company didn’t disclose a price tag, but said it expects to close the deal by year’s end.

Lincolnshire, Illinois-based Zebra Technologies is a major provider of industrial hardware, with about $4.5 billion in annual revenues as of its last fiscal year. The company makes ruggedized mobile devices that staffers at facilities such as warehouses use to scan package barcodes and perform related tasks. Zebra Technologies also sells various complementary devices: printers for producing barcode labels that can be attached to packages, parcel tracking systems and other equipment.

Additionally, Zebra Technologies makes specialized devices for organizations in sectors such as healthcare and construction. 

The acquisition of Antuit.ai continues the company’s ongoing effort to expand beyond industrial hardware into the software-as-a-service market. SaaS solutions generally have higher profit margins than hardware, which means that moving into this market could help Zebra Technologies improve its profitability. Another benefit is that the company can increase the competitiveness of its core hardware products by bundling them with complementary SaaS solutions. 

Zebra Technologies earlier made two other acquisitions to advance its SaaS strategy. The first was the 2019 purchase of Profitect Inc., which developed a cloud platform designed to help companies improve the efficiency of their supply chains. More recently, Zebra Technologies in 2020 inked a deal to acquire workforce management specialist Reflexis Systems Inc. for $575 million.

Antuit.ai will expand the company’s SaaS product portfolio by bringing a set of AI-powered customer demand forecasting tools to the table.

Antuit.ai’s tools are used mainly by retailers and manufacturers of consumer packaged goods. Such companies must closely track customer demand: retailers need continuously to fine-tune the quantity and type of merchandise they offer based on shoppers’ preferences, while manufacturers need to adjust what products they make and in what volume. Antuit.ai’s tools help companies predict demand in advance to help them align their operations more closely with demand.

The company uses a set of AI algorithms to forecast how much of each product shoppers will buy. Antuit.ai claims that its algorithms can produce more accurate predictions than traditional forecasting tools and, moreover, require less manual input. The company’s value proposition has helped it win big-name customers such as Walgreen Co., PepsiCo Inc. and Philips NV.

In addition to Antuit.ai’s core demand forecasting technology, Zebra Technologies is gaining a number of industry-specific software capabilities through the deal. For retailers, Antuit.ai offers a tool that they can use to estimate how their business would be affected if competitors were to lower prices. For manufacturers, Antuit.ai’s algorithms can generate recommendations on how to best manage customer orders when demand exceeds production line capacity.

“The acquisition of antuit.ai will further drive our ability to bring the power of AI to our customers, and meet the demands of today’s consumer,” said Zebra Technologies Chief Executive Officer Anders Gustafsson. “It will also enable us to offer our customers in the CPG industry an analytics, AI and automation solution that supports more efficient planning and operations with greater visibility across the supply chain.”

SaaS is not the only area into which Zebra Technologies is expanding in pursuit of new revenue streams. The company is moving into the warehouse automation market through the recently announced $290 million acquisition of startup Fetch Robotics Inc, which makes robots for fulfillment centers. The acquisition will buy Zebra Technologies a line of about a half-dozen AI-powered robots capable of performing tasks ranging from counting items on warehouse shelves to moving merchandise between conveyor belts.

Other enterprise hardware makers besides Zebra are also adding more software solutions and AI-powered products to their portfolios in a bid to create new revenue streams. In June, industrial equipment maker Rockwell Automation Inc. announced plans to buy software firm Plex Systems Inc. for $2.2 billion. Plex Systems provides a cloud-based platform that helps manufacturers increase operational efficiency.

Image: Zebra Technologies