On Monday, Rick Cohen’s warehouse automation company Symbotic declared record sales and a $23 billion backlog of orders, which boosted the company’s valuation by a significant amount.
Shares of Symbotic, a company that automates warehouses, jumped more than 50% when the company announced earnings today, giving majority owner Rick Cohen an additional $7 billion in wealth. According to Forbes’ real-time wealth tracker, Cohen and his family’s net worth increased by an astounding $27.8 billion today, demonstrating the power of industrial robotics. Cohen’s net worth of $7.6 billion placed him at #99 on Forbes’ 400 list of the wealthiest Americans last year.
Cohen, who is now 70 years old, is responsible for making his family’s food distribution business, C&S Wholesale food, the eighth largest private company in the United States, with annual sales of $33 billion. However, the real money is in the warehouse automation enterprise. Today’s increase in Symbotic’s stock price pushed its market value to $35 billion.
Cohen, at 70 years old, was first featured in our December 2021 article “Meet the Billionaire Robot Overload Reinventing Walmart’s Warehouses.” Before going public in 2022 in a SPAC sale sponsored by venture-capital giant SoftBank, Cohen established Wilmington, Massachusetts-based Symbotic mostly under stealth to address his own distribution troubles with C&S. By that time, the company had signed up WalmartWMT 0.0% as a customer. Symbotic’s collaboration with Walmart grew by another 42 distribution facilities in May 2022. Symbotic’s clientele includes Cohen’s C&S as well as Walmart, AlbertsonsACI +0.3%, TargetTGT +1.1%, and others.
The stock price increased due to positive third-quarter results released by Symbotic. There was a 78% rise in revenue over the prior-year quarter, from $176 million to $312 million, as reported by the corporation. It went on to say that it anticipates fourth-quarter sales of $290 million to $310 million, which would push Symbotic’s yearly sales past $1 billion. In spite of a $39 million quarterly loss, the company expects to see positive Ebitda of $0 to $3 million in the fourth quarter as it rolls out automated warehouses.
Last week, Symbotic announced that it would be partnering with SoftBank Group to offer its robotic warehouses to small and medium-sized businesses through a leasing model through a new company named GreenBox Systems. Symbotic (which owns 35% of that collaboration) stated that the rollout will begin in 2024, and that once everything is operational in six years, it expected to bring in more than $500 million in annual recurring revenue from GreenBox. On today’s conference call with investors, Cohen said, “GreenBox is the realization of a vision I’ve had for many years to bring AI-enabled automation to companies of all sizes.”
Tom Ernst, CFO of Symbotic, stated on the call that the firm had $23 billion in backlog between Symbotic and GreenBox combined. As of the conclusion of the third quarter, the firm has 10 completely functional warehouses in place, with another 33 under construction.
Symbotic’s degree of mechanization is mind-boggling. More than 400 Symbotic autonomous bots, and perhaps as many as 1,000, could quickly navigate a ten-story warehouse’s winding aisles and process several hundred orders each hour. Cohen told Forbes in 2021, “It’s a big Rubik’s cube—a big Tetris game is what we call it.” It’s like a warehouse shrunk to a convenient size.
Cohen’s decision to go public in 2022, after the market had changed and SPAC agreements had lost favor, reflected his long-term perspective. In 2022, he told Forbes, “The market is what the market is.” For me, it wasn’t a day trade in the stock market. The true worth lies in our position three, four, or five years from now. It’s better to just get started.
The outcomes of today suggest that he was correct in his prediction.
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