Advantech Deepens Edge Computing/Edge AI Strategy by Partnering with Ecosystem Players
Advantech promotes sales channels through Arrow’s extensive local business network, ensuring products meet local market demands.
Anticipating the next decade as a golden era for the integration of artificial intelligence (AI), the Internet of Things (IoT), and edge computing across various industries, Advantech, a global leader in industrial IoT, is reinforcing its transformation and deployment strategies for the edge. By partnering with a global ecosystem of collaborators, Advantech addresses the unique demands of different industries by launching edge AI-based platforms, hardware, software, and solution architectures, driving technological upgrades and business growth.
Advantech recently released its third-quarter financial report for 2024, highlighting growth in both revenue and profit compared to the previous quarter. Its October consolidated revenue also grew by nearly 8% year-over-year, reflecting a steady recovery and growth momentum in operations, alongside the success of its transformation strategy to adapt to market and industry changes.
For example, in the EU, regional system integrators (SIs) or small channel partners may not have the capacity to provide corresponding service models. Especially, many applications today emphasize the ‘last mile,’ where locally manufactured products or designs entering overseas markets may involve different regulations and cultures, requiring comprehensive hardware assembly and software integration.
Therefore, partnering with global channel partners or large SIs, leveraging their global distribution network, helps promote sales, drive implementation, and even open new markets, creating a win-win situation. Chang cited Arrow Electronics as an example. “A technology company like Arrow with a global footprint can provide different values in different regions,” he said.
For example, in Taiwan and other Asian regions, Arrow provides assistance in component procurement and supply chain services, even advanced product design-in technology. The cooperation between the two parties spans the entire product development and manufacturing value chain.
In markets such as the Americas, Europe, and the Middle East, Advantech promotes sales channels through Arrow’s extensive local business network, ensuring products meet local market demands and providing services from hardware assembly to software integration. For example, Arrow’s integration centre in Israel helps customers like Advantech with comprehensive integration, “from development boards, software installation, to even designing the enclosures!”
Fostering Win-Win Collaborations
In addition to global channel partners, Advantech adopts a multi-role cooperation model to expand the supply chain, collaborating with chip manufacturers, software vendors (ISVs), system integrators (SIs), and other partners to drive transformation and establish a more comprehensive partner ecosystem.
Chang said that in the multi-stage transformation process, partners play an important role. From AI chip technology, large semiconductor companies like Intel®, AMD, and NVIDIA provide the chips needed to drive AI computing, helping Advantech continuously accelerate the computing performance of edge devices. Additionally, software vendors like Microsoft, Linux, and Google Android provide operating systems, helping Advantech enter innovative smart application markets like AI PCs.
Advantech also collaborates with SIs, particularly domain-focused SIs (DFSI), to more efficiently introduce Edge AIoT and Edge AI into specific industry applications. Chang said that compared to traditional hardware integration-focused SIs, DFSIs are particularly important in the AIoT era.
Most especially as Advantech has over 70 product lines, and the same computer or AI product introduced into hospitals, smart factories, new energy, or robots must consider their respective technical, appearance, network, ecosystem, or cultural background needs. “No SI can fully support every domain; each needs to provide its own technical know-how and professional services,” said Chang.
This multi-role partner strategy, combined with Advantech’s sector-driven focus, is leveraging synergies from different geographic regions, vertical industries, and product types, accelerating Advantech’s move towards a diverse and professionally segmented business team and product portfolio.
Optimistic Outlook for Edge Computing/Edge AI
Advantech is optimistic about the overall recovery of the industry, expecting to emerge from the current operational trough next year. While inventory adjustments impacted performance this year, positive growth trends are already evident in industries such as healthcare and manufacturing.
Looking ahead, Advantech will continue to focus on edge computing and edge AI as its core strategies. It plans to expand its footprint in established industries like factory automation and smart healthcare while actively exploring emerging fields, including service robotics, autonomous mobile robots (AMRs), drones, renewable energy, and smart cities. With this dual approach to fostering growth across diverse sectors, Advantech anticipates a promising year ahead.
Multi-Stage Transformation: From IPC to Edge Computing and Edge AI
Celebrating its 40th anniversary last year, Advantech’s journey has been marked by multiple transformations. From being a local industrial PC (IPC) manufacturer in Taiwan to becoming an international corporation, the company expanded its product portfolio and ventured into IoT, and later, AIoT. Each transformation strengthened Advantech’s competitive edge.
According to Miller Chang, President of Advantech’s Embedded Sector, the company has continuously adjusted its operational focus—from IPC and IoT to its current emphasis on edge computing and edge AI. Today, Advantech adopts a sector-driven approach, focusing on vertical industry needs. Starting as a Taiwan-based export-oriented manufacturer, the company has since established overseas branches, expanded its product lines to over 70, and laid a solid foundation for edge computing and edge AI development under management philosophies like the “Amoeba Management” of Kazuo Inamori and IBM’s Business Leadership Model (BLM).
With the rise of IoT, Advantech shifted from hardware dominance to hardware-software integration. Recently, under the AI wave, it has integrated AI with edge computing, applying critical AI technologies to industrial automation, healthcare, and other fields to accelerate intelligent transformations.
Chang emphasized that Advantech is transitioning from a product-driven sales strategy to a sector- driven approach that dives deep into specific industry needs, ensuring technological innovations are effectively implemented across industries.
Focusing on Edge Computing and Edge AI
Under its sector-driven strategy, Advantech will further develop edge AI based on its existing edge computing technologies and product portfolio from IPC and embedded systems, and its extensive installed base across various industries. This will be a key development focus for 2025 and beyond, actively developing edge AI-related platforms and solution architectures to achieve software and hardware integration, particularly promoting innovative applications of edge devices and AI in industries such as factory automation, healthcare, and smart cities.
“Industry growth must balance existing markets with emerging ones,” Chang said. He noted that AI adoption is most rapid in areas like factory automation and healthcare (e.g., image processing), with newer applications, such as robotic surgery systems, renewable energy, and smart cities, quickly following suit. These fields are Advantech’s key areas of focus.
As part of this transformation, software-hardware integration plays a crucial role. Advantech has significantly increased its software development resources, expanding its team from 200 to 400 developers. To address customer challenges posed by diverse AI chip SDKs, Advantech has developed its own Edge AI SDK platform, which integrates runtime SDKs from major chipmakers, evaluates AI chip performance, and assists customers in choosing suitable hardware. After customers complete AI model training, the SDK enables deployment to edge devices.
Rooted in Taiwan, Expanding Globally
From its inception, Advantech has been expanding overseas, with the US, China, and Europe accounting for about 70% of its global market business.
According to Advantech’s 3Q24 report, North America accounts for about 31%, China 23%, and Europe (excluding the Middle East), about 17%.
Currently, Advantech’s business in the US, China, and Europe accounts for about 70% of its global market business. North America, Taiwan, and South Korea markets performed well in October this year, growing by 12%, 22%, and 20% year-on-year (YoY), respectively. Europe, China, and Japan markets
also showed single-digit growth, mainly driven by industries such as factory manufacturing and healthcare.
Advantech will continue to expand its overseas market footprint, particularly through global channel partners and local branch offices. According to Chang, Advantech began establishing overseas bases 30 years ago and now has branch offices in about 90 cities in 27 countries worldwide, responsible for key customers and promoting overseas business through
channel partners, particularly for edge computing and edge AI solutions.
“In fact, this is not easy. It is no longer just a ‘box moving’ model; partners must be able to provide corresponding services and integration capabilities,” he said.