ABB Ltd. plans to spin off and list its robotics unit in 2026, as the Swiss manufacturer aims to improve its least profitable division as a standalone company.

The business, which makes industrial robots and related software, is to start trading in the second quarter of 2026. Likely listing venues are Switzerland and Sweden, chief financial officer Timo Ihamuotila said April 17.

ABB cited limited synergies with its other units, and improved capital allocation for the plan. The robotics division “would benefit from being measured more directly against its peers,” the Zurich-based manufacturer said.

The move will allow ABB to focus on more profitable businesses such as its electrification unit, which is benefiting from soaring investments in data centers triggered by an artificial intelligence boom. The robotics division has recently struggled with a manufacturing slowdown in China.

ABB shares rose as much as 5.1% in Zurich on April 17. The stock is still down around 14% this year. 

The company on April 17 flagged increased global economic uncertainty due to tariffs, but still confirmed its full-year guidance when reporting quarterly earnings. Around 80% of ABB’s sales in the U.S. are generated with locally made products, chief executive officer Morten Wierod said, adding that the manufacturer plans to further increase that share.

The robotics and discrete automation division’s operating earnings margin slipped to 9.9% in the first quarter. 

Robotics accounted for around two thirds of that business and generated double-digit margins, while the weaker machine automation part — which ABB plans to keep and integrate into its process automation unit — struggled with low utilization rates in production. The electrification unit’s margin increased to 23.2% in the same period.

Spinning off robotics is a “logical step, creating two companies with further sharpened focus, strong potential for continued profitable growth and long-term value creation for their shareholders,” said Christian Cederholm, who heads ABB’s largest shareholder Investor AB.

The robotics division employs around 7,000 people, and generated $2.3 billion in revenue last year, or roughly 7% of group sales. It operates manufacturing hubs in Sweden, the U.S. and China and competes with the likes of Japan’s FANUC Corp., Yaskawa Electric Corp. and Midea’s Kuka. 

It may be worth around $3.5 billion as a standalone business, RBC analysts led by Sebastian Kuenne said in a note.

The unit makes products including industrial and collaborative robots used in the food and automotive industries as well as autonomous mobile robots that maneuver merchandise in logistics centers.

ABB shareholders will receive stock in the future listed robotics company as a dividend in-kind in proportion to their existing shareholding, the company said.