Peggy Johnson Leads Agility Robotics to Public Success

Peggy Johnson began her engineering career in 1985 when personal computers were just emerging in homes. The World Wide Web had not yet been invented, and humanoid robots were considered science fiction. Decades later, Johnson, at 65, has led the first humanoid robotics company to go public in the US.

On Thursday, Johnson’s Oregon-based Agility Robotics went public through a merger with a special-purpose acquisition company, raising around $465 million. This funding will boost production and deployment of Digit, a two-legged robot built for tasks in warehouses and factories. Despite market fluctuations after the midterm elections, Agility shares closed Friday at $9.90, a decline of nearly 14% from Thursday’s closing.

For Johnson, this listing represents a milestone in her career, which has spanned from Qualcomm to senior roles at Microsoft, and leading augmented reality startup Magic Leap. Her current challenge is to make humanoid robots a profitable venture.

Challenges in Humanoid Robotics

Despite billions invested in humanoid robotics, there is debate among experts about the need for robots to resemble humans. The technology is not yet proven at scale. Agility reported just $1.8 million in revenue last year, with a $138.1 million net loss, as per regulatory filings.

Yet, Agility Robotics operates in nine customer facilities, including Amazon, Toyota, and GXO. They’ve secured over $300 million in orders for 1,000 robots from a financially linked customer.

Competition in the sector is growing. Figure AI, with a recent valuation of $39 billion, and Apptronik, valued at around $5.5 billion, attract significant investor interest and conduct customer trials. Tesla, led by Elon Musk, focuses on its Optimus robot, already under production.

Johnson believes Agility’s operational experience gives it an advantage. “This is a real business problem right now, and we can fill that need that companies have for automation,” she said.

From Engineer to CEO

Johnson grew up in a busy Los Angeles home with 15 siblings. When her father passed away young, she had to fund her own education. She graduated from San Diego State University with an electrical engineering degree, juggling various jobs to pay for tuition.

She started at General Electric before joining Qualcomm in 1989, then a young wireless tech company. Although initially shy in the male-dominated engineering world, she excelled over 24 years, eventually becoming executive vice president of global market development. She played a key role in significant deals, like a 2002 agreement with Nextel and a $1.925 billion sale of wireless spectrum to AT&T in 2010.

Johnson caught Microsoft’s attention, and in 2014, joined to lead business development. She contributed to Microsoft’s $26.2 billion acquisition of LinkedIn and launched M12, its venture capital arm.

Nagraj Kashyap, who worked under Johnson at both Qualcomm and Microsoft, praised her leadership style. “She gave me air cover to let me do my job the way I saw fit,” he said, highlighting her belief in hiring talented people and allowing them to excel.

Wanting to lead a company, she became CEO of Magic Leap in 2020, navigating it toward enterprise customers before joining Agility Robotics. She saw potential in their robots ready for commercialization.

Johnson’s Current Challenge

Two years into her role at Agility, Johnson needs to convince investors of the company’s potential. Agility’s filings reveal the costs and projections for their Digit 5 robot. Initially costing $150,000 in materials, this is expected to drop with higher production rates. They anticipate robots to last five years and offset costs in 18 months via a robot-as-a-service model. Success depends on scaling production and reducing costs.

Michelle Sun, a robotics analyst, acknowledges the challenges in unit economics. Johnson’s focus remains on enhancing Digit’s industrial utility. Agility established a 60,000-square-foot facility in Fremont, CA, for skill enhancement. The company uses 65,000 hours of operational data to refine technology.

While Johnson foresees robots in homes eventually, the immediate focus is on meeting factory and warehouse demands due to labor shortages. A Deloitte study forecasts 1.9 million unfilled US manufacturing jobs by 2033.

Agility has identified 30 prospective industrial customers. “They can’t find people,” Johnson stated. “It is definitely existential for these companies and we can help solve the problem.”