Those who fear not knowing their place in the world should Trimble. Trimble Navigation makes systems and software that combine global positioning technology with wireless communications to provide location and position data and make it actionable. Using GPS, laser, optical, and other technologies, the company's products target areas such as surveying, construction site project management, mapping, mobile personnel management, and mobile and fixed asset management. They are offered to end users, such as government entities, farmers, engineering firms, and public safety workers, as well as equipment manufacturers (OEMs). About half of sales are made outside the US.
To establish certain operational advantages, Trimble divides its business into four segments: engineering and construction, field solutions, mobile solutions, and advanced devices.
Engineering and construction products command more than half of sales and include, among a wide range of others, construction machine guidance systems and robotic optical surveying instruments.
Field solutions (about a fifth of sales) get used right where the name suggests - out in the field. Trimble markets such products to the agricultural and geographic information system (GIS) sectors. Agricultural offerings include systems that provide navigation guidance for farm equipment. It also sells handheld data collection units designed to work with GIS databases. Utility companies use such systems to gather information about transmission poles and have the data automatically stored.
Mobile solutions (another 20% of sales) start where field solutions end: at the mass workforce level. It makes hardware and software used to handle scheduling for field service technicians and other mobile personnel. It also provides in-vehicle GPS receivers and other systems for tracking mobile assets. Mobile products are sold under the brands Trimble, PeopleNet, TMW, and ALK Technologies.
Advanced Devices (about 6% of sales) encompasses Applanix (mobile mapping), embedded technologies (boards, modules, chipsets, licenses), military and advanced systems (aircraft navigation), timing and synchronization, Trimble Outdoors (GPS-enabled cell phones) businesses, and ThingMagic (UHF and radio frequency identification (RFID) reader modules and services). Most of these products are hardware focused and are typically marketed to OEMs, system integrators, or service providers.
Trimble has principal facilities in Canada, China, India, New Zealand, a handful of European countries, in addition to its North American locations. The US is its largest single market, accounting for 48% of sales in 2013. Customers in Europe made up another quarter of sales, while Asia followed with 14%.
Contract electronics manufacturers, principally Flextronics International and Benchmark Electronics, make some of Trimble's products at factories in China and Mexico.
Sales and Marketing
Trimble pitches its products to customers via dealer partnerships on all products except advanced devices and mobile solutions products. It also uses representatives, joint ventures, and other sales channels, supported by offices in 35 countries. Trimble sees its existing markets as underpenetrated, offering opportunities to expand adoption of its products as replacements for lingering traditional methods. In that regard, product development is also a key strategic component for both maintaining and broadening the company's ability to serve its target markets. It ramped up advertising spending by about $5 million to $39 million in 2014.
As a leader in its industry, Trimble Navigation is a $2 billion company. In 2012 it reported revenue of $2.4 billion, up 5% from 2013. Profits, however, were off 2% at $214 million after hitting record $218 million in 2013. Cash flow from operating activities was also down, falling about $7.5 million to 407 million in 2103. The revenue increase was driven by growth in Engineering and Construction and Mobile Solutions. Field Solutions revenue dropped because of softness in the agriculture sector. The company increased spending in several areas -- research and development and advertising, which cut into profits.
The company focuses on growth in international markets as a major component of its strategy. The acquisitive company is particularly interested in opportunities in Africa, China, India, the Middle East, and Russia.
Mergers and Acquisitions
Trimble continued its acquisition tear in 2015 from 2014 and previous years. Recent acquisitions were made to add capabilities that extend beyond navigation and, in some cases, into the cloud.
The Manhattan Software acquisition provides Trimble with design-build-operate software for building owners, facilities and real estate managers. It acquired Fifth Element, a provider of forestry enterprise and mobile software for logistics and harvest operations.The acquisition expands Trimble's forestry presence in Northern Europe. Fifth Element works in a software-as-a-service model.
In 2015 Trimble bought Linear project GMBH, a provider of scheduling software for linear infrastructure projects.
With MAYBIM, Trimble gets a provider of 3-D Building Information Modeling (BIM) services for mechanical, electrical and plumbing (MEP) contractors across the US. MAYBIM's suite of 3-D BIM professional services allows for contractors to scale their BIM capabilities regardless of the requirements from the building owner or general contractor.