What CEOs talked about in Q3 2020
For many companies, the third quarter of 2020 was characterized as “shifting back to the (new) normal”.
While in Q2, companies were busy organizing for remote work, handling disrupted supply chains, and dealing with new cybersecurity threats, Q3 saw some of the pre-Covid themes rise in importance again (see here for our Q2/2020 analysis). The themes that had the highest increase in importance in the July-September timeframe include the Industrial Internet of Things, AI, analytics, as well as sustainability. Cloud and 5G remain some of the most discussed topics, but without much change compared to Q2.
This is one of many findings of IoT Analytics’ latest 104-page publication titled “The State of IoT Q4/2020 & Outlook 2021” (available to download for corporate subscription clients).
The analysis highlighted in this article is one of many analyses presented in that report. It looks at specific keywords from 3,000 earnings calls of US-listed companies. The resulting visualization is an indication which digital and technology topics CEOs prioritized in Q3.
The chart visualizes keyword importance and keyword growth:
- X-axis: Keyword importance (i.e. how often have keywords been mentioned in Q3). The further out on the x-axis, the more often the topic has been mentioned all together.
- Y-axis: Keyword growth (i.e. what is the increase or decrease Q3/2020 vs. Q2/2020, indexed to 100). A number >100 on the Y-axis indicates the topic has grown importance, a number <100 indicates the topic has lost in importance.
These were some of the hottest topics discussed by CEOs:
Priority #1: Industrial IoT
Earnings call mentions for the Industrial Internet of Things grew 92% in Q3 2020. Topics such as “remote asset access”, “remote commissioning of new assets” and “connecting previously unconnected assets/machines” were some of the top themes that companies started to prioritize and that are expected to stay very high on the agenda in the coming quarters.
Sample CEO quote from Q3:
“Following this, and beginning in 2022, there will be another cycle of industrial IoT applications, even bigger than the last, which will drive strong growth in the mature process technology segment.”Mary G. Puma – CEO of Axcelis Technologies Inc. 08/05/2020
Priority #2: Sustainability
Sustainability and related topics are back on the agenda. After discussion of the topic diminished in Q2, companies are now prioritizing aspects such as carbon footprint reduction, recycling, or enabling the circular economy. Mentions of “sustainability”-related topics grew 58% in Q2/2020.
Sample CEO quote from Q3:
“We are expanding our solutions to allow customers to measure and reduce carbon emissions along their value chain. Since earlier this year, we are running trials with customers from industries like auto, chemicals, food and engineering.”Christian Klein – CEO of SAP SE 07/27/2020
Priority #3: AI and analytics
Investment into Artificial Intelligence and analytics-related topics are back. All of the related topics, including “Data Science”, “Machine Learning”, and “Predictive Analytics” grew significantly as CEOs highlighted the importance of analyzing data both for cost-reduction purposes as well as for developing new offerings for customers.
Sample CEO quote from Q3:
“We are now entering the age of insights, driven by the amount of data we are generating and the utilization of new analytic tools, such as machine learning and artificial intelligence technologies. Customers are looking to power a new breed of applications and workloads that work in concert with the cloud, but analyze and process data at the edge.”Antonio Neri- CEO , Hewlett Packard Enterprise Co. , 08/25/2020
Other notable observations (and opinions)
- Widespread digitization is coming. Over the last few months, Tech company CEOs such as Satya Nadella of Microsoft emphasized that they believe firms are now accelerating their digital transformation initiatives. An IoT Analytics survey of 50 IoT end-users in September 2020 shows that an overwhelming 92% of organizations are accelerating their “company-wide digitization” initiatives. (Note: The entire survey results are part of the State of IoT report)
- Private and hybrid cloud accelerating. Although overall mentions of “cloud” did not move much in Q3, both “Private Cloud” and “Hybrid cloud” did (not shown in the chart for simplification reasons). In fact, “private cloud” as a topic increased more than 100% compared to Q2. The trend towards private cloud is also backed up by IoT Analytics survey data which will be released later this year as part of the upcoming “Cloud Computing for IoT Market Report 2020-2026”.
- The Q2 trend on “3D printing” was short-lived. There was a lot of talk during the first wave of the pandemic on how additive manufacturing and 3D printing helped in producing much needed supplies such as respirators. The hype around this technology and its ability to locally create much needed parts faded significantly in Q3. Mentions of both 3D printing and Additive Manufacturing declined ~60% after rising approx. 100% in Q2.
More information and further reading
Are you interested in learning more the current State of technology and the Internet of Things?
The State of IoT Q4/2020 & Outlook 2021 is a comprehensive 104-page report on the current state of the Internet of Things, incl. market update & forecast, latest trends, IT spending update, and more. This report is based on insights from the whole IoT Analytics analyst team and was compiled for IoT Analytics subscription customers.
This report provides answers to the following questions (among others):
- Numerous insights on the current market environment, recent technology developments, latest IoT projects, and notable announcements
- IoT market update & outlook (global IoT connections, revenue, regional view)
- Survey data from 50 senior IT decision-makers (on current priorities, spending, and outlook)
- Covid-19 themes (incl. 21 IoT-related themes that are accelerating now)
- Tech stack analysis across 5 layers (IoT Hardware, Connectivity, Software/Platform/Cloud, Analytics/AI, IoT Security)
- Investment & M&A highlights
A sample of the report can be downloaded here:
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