There is a lot of overblown hype regarding artificial intelligence (AI), automation, and robotics. The usefulness and real-world applications are still largely to be determined. There's a tremendous amount of speculation in this realm, which is why Symbotic's (NASDAQ: SYM) traction and growth are so impressive.
After an excellent earnings report for the fourth quarter of its fiscal 2025, ended Sept. 27, and an optimistic Q1 2026 forecast, Symbotic stock's meteoric rise continues. The question isn't whether or not Symbotic will succeed in transforming modern warehouses and supply chains; it's whether the company will become the gold standard and default option. If Symbotic can revolutionize the likes of Walmart's warehouses, expect to see a gold rush for the company as other major suppliers and retailers board the train.
Beating competition with actual revenue
Many robotics companies are still in the research and development phase. Symbotic, however, is signing new contracts and scaling. The company's revenue reached $2.247 billion in fiscal 2025, a 26% increase from the year prior.
Symbotic financials are gaining strength as the company reported significant increases in revenue; adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA); free cash flow; and adjusted gross profit margin in its Q4 earnings. The robotics company based out of Wilmington, Massachusetts, boasts an impressive backlog of orders totaling approximately $22.5 billion.
Even more impressive is the list of blue-chip companies using Symbotic's systems. Powerhouses such as Walmart, Target, and C&S Wholesale are a few of the well-known names signed to multi-year deals with Symbotic.
Labor shortages and the need for cost reductions make Symbotic's abilities appealing to major suppliers and retailers worldwide. Symbotic has also shown that it is effective in using AI to optimize its customers' operations. This particular expertise should help Symbotic improve its own margins, particularly where costly hardware hurts the balance sheet.
Symbotic's partnership with SoftBank is enabling the company's entry into a global marketplace, starting with Europe and Asia. This is an important step for the company and one in which its ability to execute will be tested.
The key to success is keeping R&D costs down
Symbotic faces significant headwinds in future research and development costs. The engineering, hardware, and testing needed prior to deploying its systems are expensive and will likely only get more so. Symbotic's overall expenses have grown, but not at a faster pace than revenue. The company will need to keep expenses in check as it invests capital in developing new technologies, which is required to maintain a competitive edge.