Why Autostore’s valuation is soaring

by Rueben Scriven, Interact Analysis

Founded in 1996, AutoStore is a Norwegian warehouse automation vendor specializing in ultra-high density storage systems. Ultra-high density storage systems use a swarm of robots which traverse the top of a three dimensional structure made up of totes. As an order comes in, the robots ‘dig’ out, or retrieve, the correct tote and carry it to the edge of the grid where a human worker picks the correct number of items.

AutoStore operates by licensing its technology to well-known integrators such as Swisslog, Dematic and Element Logic. To date, AutoStore has deployed 20,000 robots at 600 sites across 35 countries. This is up from just 130 installations in December 2016 and 350 in June 2019.

A series of acquisitions in the market

In 2016, EQT Partners acquired AutoStore with a valuation of €500m (US$594m) representing an EBITDA multiple of 18.8x, according to Unquote. AutoStore’s revenues grew from approximately $60 million (NOK 240m) to just under $200 million between 2016 and 2019 representing a CAGR of just under 50 percent, well above the warehouse automation industry average of 12 percent.

In June 2019, Thomas H. Lee (THL) acquired AutoStore, valuing the company at €1.6b ($1.9b). AutoStore’s 2019 EBITDA was $108m resulting in a EBITDA multiple of 17.6x. Along with AutoStore, THL acquired a number of other warehouse automation vendors including Material Handling Systems (which we discuss in depth here) and Fortna.

Recently, Japanese tech conglomerate Softbank acquired a 40 percent stake in AutoStore for $2.8b, valuing it overall at $7.7b. Assuming a 50 percent revenue growth rate from 2019 and a 2020 EBITDA margin of 55 percent (AutoStore’s EBITDA margin in 2019), this would result in an EBITDA multiple of 48x when comparing 2020 EBITDA with the $7.7b valuation. This begs the question: Why has AutoStore’s valuation skyrocketed in recent years?

Strategic shift towards micro-fulfillment

AutoStore has positioned its technology as an ideal solution for micro-fulfillment; the concept of installing small automated centres in urban areas for rapid fulfillment. The automated micro-fulfillment centre market is forecast for rapid growth as the traditional centralized model struggles to meet growing demand for same-day delivery requests. By 2025, we forecast that there will be more than 2,000 micro-fulfillment centres installed globally. To date, AutoStore has a number of micro-fulfillment centres installed across the globe, most of which have been installed by Swisslog. These include micro-fulfillment centres for H-E-B in Texas and the recently announced partnership with Ahold Delhaize in Philadelphia.

Hardware and software developments

In recent years, AutoStore has announced several developments to its system including both hardware and software upgrades. Most notably the new Black Line robots, which joined the Red Line robots in AutoStore’s portfolio. Black Line robots can handle larger bins with better battery management and regenerative braking, eliminating the need for downtime whilst charging. In addition to the Black Line, there have been several software upgrades to the system such as the ability to store finished orders within the grid system alongside inventory. The resulting hardware and software upgrades have improved the presentation rate from 450 to 600 presentations/hour.


The consumer shift towards online retail during the pandemic has highlighted many of the inefficiencies that currently exist within today’s logistics systems. Many retailers’ online strategies moved ahead by five years in the space of a few months. To remain profitable, retailers and grocers alike are looking towards automation to help curb costs and provide the flexibility needed to meet higher than expected growth in eCommerce. You can read more about our pre- and post-COVID warehouse automation forecasts here.

SoftBank synergies

SoftBank has stakes in several companies which will likely benefit from having a closer relationship with AutoStore. Most notable is Coupang which has been dubbed the Amazon of South Korea. Coupang’s recent IPO was a huge success and it’s likely that much of the funds will be used to expand its logistics network across South Korea and potentially even internationally. SoftBank also owns a stake in FlipKart, Tokopedia, GoPuff and ShipBob, all of which are potential customers for AutoStore.

Final thoughts

AutoStore’s phenomenal valuation trajectory and EBITDA multiple paints a sunny picture for the warehouse automation sector. COVID-19 has seen demand for warehouse automation equipment skyrocket. For example, Dematic – one of AutoStore’s licensing partners – recorded a 100 percent increase in warehouse automation order intake in Q2 2020. SoftBank is forming a strong logistics portfolio and AutoStore has the potential to benefit nearly all of SoftBank’s logistics investments.


This opinion was supplied by Interact Analysis. To learn more about Interact Analysis’ research on warehouse automation, click here.