Results, as well as the outlook into the coming few quarters. So with us on this webcast, we have CFO and President of General Management, Eric Chen, and also the President of Embedded IoT Group, Miller Chang. So without further ado, let me pass it to Eric for the prepared remark.
Thank you, Derek. Good morning and good afternoon, everyone. Thank you for joining today's IR meeting. This is Eric Chen, CFO of Advantech. Please review the agenda. In second one, since Grace is on sick leave, I will brief you regarding our third quarter 2024 financial results. Then I will provide a business update and our guidance for quarter four. And during this session, we are honored to have Miller Chang, President of EIoT, join us to share additional insights and market trends with you. As usual, please take a few seconds to read the safe harbor notice. For the third quarter financial result, revenues in quarter three reached TWD 14.9 billion, representing a 2% increase compared to the previous quarter and remained flat year on year.
Gross margin, the gross margin rate, improves to 41.3%, reflecting a 1.2 percentage point increase year on year, primarily due to a reduction in material costs and a favorable product mix. Operating profit was NT$2.45 billion, resulting in an operating margin rate of 16.5%, which marked a 1.6% increase quarter on quarter, although there was a slight decline of 0.3% year on year, and the effective tax rate was close to 18%. Net income for the third quarter was reported at NT$2.26 billion, showing a 7% increase quarter on quarter, but a 13% decline year on year. EPS, earnings per share for quarter three, stood at NT$2.61. For year-to-date third quarter 2024 performance, overall, the top line and the bottom line figures increased quarter by quarter, but there was still a significant year on year decline.
In the first nine months, sales revenue reached NT$43.5 billion, representing a 12% decline year on year. Gross margin rate was 40.6%, an increase of 0.3% point year on year. Operating expense rose by around NT$0.6 billion, mainly due to the approval of ESOP expenses. I will explain more details about this part. Operating margins fell to 15%, a decrease of 4.1% point due to weak EIoT performance. For non-operating items, amount to NT$1.2 billion. For the first three quarters, net income was NT$6.36 billion, down 26% year on year. Earnings per share were NT$7.39. For regional performance, year to third quarter revenue reached $1.36 billion, reflecting a 15% decline year on year. The major three markets, which account for 71% of the revenue, are exploring.
North America was the largest contributor, experienced a 17% year on year decline. Europe saw a significant decline of 27%. The US and European region faced postponed project and slow demand in the logistics, gaming, and retail sectors. China market declined by 4% year on year, but customer demand is gradually becoming more stable and increasing. In North Asia, the overall decline was 14% year on year. Japan experienced a 27% decline, while Korea grew 10%. The ASEAN market demonstrated an impressive 18% increase, making it the best performing region in the world. The industrial equipment, AMR, and semiconductor sectors mainly drive this growth. Emerging market overall declined by 9% year on year. However, momentum remains strong in Mexico and Brazil. Let's look at the performance by SBG.
Industrial IoT accounts for 30% of revenue contribution and declined 4% year over year, mainly due to the more stable demand in China market. Taiwan and Korea market also represent positive growth. Embedded IoT was down 19% year over year. ACG was down 14%, and ICVG declined 24%. The three SBG were all impacted by customers postponing their projects. SIoT declined 20% year over year. Three major sectors include logistics, retail, and healthcare, which shows negative growth. Here is the page of balance sheet overview. In quarter three, the total inventory value was NT$9.9 billion, representing a decrease of around NT$0.9 billion year over year. The turnover day for inventory were 105, which is a reduction of 11 days compared to the same period last year. Although there was a slight increase from the second quarter.
Accounts receivable turnover days stood at 58, while accounts payable turnover days were at 67. Overall, the cash conversion cycle improved from 111 to 96 days year on year. This concludes the financial briefing for the third quarter result. The next session is the third quarter comments and the fourth quarter guidance. Let me add some comments regarding the third quarter result. Our Q3 results align with our expectations, while the gross margin and operating profit were slightly better than our guidance. Regarding regional performance, the U.S. and European markets experienced slowdown in customer demand and project delays, leading to double-digit sales declines. Conversely, the Chinese market showed signs of gradually recovering, with only a single-digit decline. The market in Taiwan and Korea performed well, which achieved double-digit growth due to strong demand for semiconductor and IEMS.
From the product perspective, we faced weak demand across various sectors, including gaming, retail, logistics, and network security platforms. However, if you look at our BB ratio on the page, you will see our bookings and shipments are on an upward trend. Now, let's look at the trend of BB ratio across different regions. As the page shows, the BB ratio for the third quarter was recovering to 1.07, although in the U.S. and Europe, it rose by 16% and 23% respectively. Although China saw a 7% decline, its BB ratio remained above 1.0. This uptrend BB ratio indicates a positive outlook for our revenue in the coming seasons. Looking ahead to the fourth quarter, we anticipate revenue to be between $480 million and $500 million, assuming an exchange rate of $1 to TWD 31.7.
Regarding margins, we expect the fourth quarter gross margin to be between 39% and 41%, while the operating margin is projected to range from 14.5% to 16.5%. This concludes my fourth quarter guidance, and thank you for your attention.
Okay, thank you, Eric. So now we will start the Q&A session. We have gathered some questions from investors earlier, and Management will go through them first. And after that, we will take some questions from the line.
Okay, for the purposes regarding the outlook of the first quarter 2024, I guess 2024 and the full year 2025, for the fourth quarter guidance, I mentioned consolidated revenue will be between $480 million and $500 million. And also the gross margins between 39% and 41%, and operating margins between 40.5% and 16.5%. For the outlook of the entire year of 2025, it's still too early to make projections. The BB ratio in October was higher than the third quarter at 1.07. So we are confident that we have a solid opportunity to deliver good results in the first quarter of next year. And also the formal guidance will be released in February 2025. The key drivers, because they have a question regarding the key drivers, will primarily come from the automation, semiconductors, healthcare, and energy and utility sectors.
And let me break down by region for the fourth quarter guidance. In North America, a strong demand for semiconductor and energy supports double-digit growth. Transportation, healthcare, and video equipment booking shows recoveries. So we anticipate single-digit revenue growth in quarter four. This is for North America regions. China bookings are recovering in energy, machine automation, and transportation, while semiconductor and healthcare equipment have seen declines. We project breakthrough single-digit revenue growth this quarter. And for Europe, transportation and industrial equipment bookings have double-digit growth. We expect a high single-digit return this quarter. In addition, the demand for the semiconductor in Korea and Taiwan remains strong. Also, the healthcare in Japan is recovering. So this is regarding the quarter four guidance, also the key driver for the growth.
The second question is regarding the OpEx because our sales actually underperformed, but the OpEx remained at a high level. Also, the question is regarding how the company to effectively manage expense. So allow me to explain the reason first. There are two main reasons for this increase in operational expenses. The first is related to the ESOP expense approval. ESOP stands for Employee Stock Option Grant. In 2023, we issued 8,000 ESOP, resulting in a total expense of around TWD 1.2 billion. And under IFRS regulation, we must accrue the expense from 2023 to 2028. And in 2024, the ESOP expense approval reached to the peak of TWD 400 million, and we're gradually declining year by year. If we accrue this expense, the OpEx increase rate is around 3.0%. So this is the first reason.
The second reason is the rise in operational expense is our strategic investment in R&D, particularly in recruiting talent in Edge AI software engineering and associated investment. This area has been an increase of around 10% R&D expense, around NT$350 million year on year. For expense control, given the personnel cost accounts for 75% of our total operational expenses, managing the headcount is crucial. Advantech has seen a reduction in our total headcount by 0.8% on a year-over-year basis. Travel and marketing expense accounts for another 5% of our total expense, and we have decreased by 4%. Overall, due to the accrual of ESOP expenses, the investment in Edge AI R&D accounts for a large portion of the overall increase. Even though we have reduced the total headcount and marketing expenses, the total expense has still increased. Internally, we aim to improve our employee productivity per headcount.
We review our OpEx regularly. For 2024, organic headcount growth is still under strict control. Only a few key talents in the strategic area can be recruited. So this is the way we control our expense. Actually, the headcount is under real control. Also, the travel expense, the variable expenses are under control, but we have put more resources on R&D. Also, we have a large portion for the ESOP expense accrual. So this is the reason why our expense rate is quite high. For question three, it's regarding BB ratio to assist 1.1 in fourth quarter 2024 under design win and designing status. As mentioned, our BB ratio exists 1.08 in October. Actually, it's a little bit close to 1.1. However, it's still challenging to pinpoint whether BB ratio will return to 1.1 in this quarter.
Our BB ratio has been on an uptrend since the first quarter, and we anticipate it will continue in the first quarter. For design-win and design-in figures in the U.S. are very encouraging. Over $700 million in design-win have been accrued since 2023. And over 50%, half percent of this came from a new customer and new projects. This figure will secure the U.S. region revenue in 2025 and 2026. So we have a good outlook for the U.S. region next year. Also, for the average selling price, at the beginning of this year, we made some price adjustment in China to strengthen our competition. And the feedback from our customers was positive. And more and more customers are returning to Advantech to buy our products because they have experienced poor product quality and support issues from local emerging peers.
For other regions, there's no plan to adjust SP. So we have no plan to adjust ASP except we already take action in China region. For the design-in design-win, they acquire promising in the U.S. regions. For question number four regarding the capacities, Advantech currently has 23 SMT production lines, 11 in China and eight in Taiwan, and four in Japan. In the third quarter, the utilization rate in China was below 80%. Taiwan was about 100%, and Japan was around 95%. For the fourth quarter, the utilization rate in China was up to 82%. Japan and Taiwan region will remain the same. For the CapEx in 2024-2025, we are currently working on two main projects. The first is North America head office in Southern California. This is expected to be completed in quarter three of 2026.
The total construction fees are around $85 million. The second project is the second manufacturing center in Huaya, Linkou, Taiwan, which is expected to be launched in quarter two of 2028. The total construction fee is around $100 million. Besides, just a few days ago, the board of directors also approved the new Japan manufacturing plant project. The total construction fee will be around $33 million, and it's expected to be completed in the year 2027. Lastly, the total CapEx will be around $80 million annually from 2024 to 2025, including the construction fee for the three main buildings and some production and R&D equipment upgrade. So this is regarding the capacity for each region and also the CapEx plan. For the following question regarding the RBU and SBU, I will hand over to Miller to share some insight for our investor.
Okay, thank you, Eric. So I will answer the follow-up four questions from 2.1 to 2.4 first. The 2.1 is regarding for the EIoT business decline. Yes, the main reason for the EIoT revenue decline this year is our customer overstock issue, especially from last year's second half to this year. As you may know, our EIoT business model mainly focuses on the key account design-in model. So in major regions like North America, Europe, China, and Japan, our key customers, our big customer service markets like medical equipment, industrial equipment, those customers are all suffering in the overstock issue. This is the main reason. Okay. Then about the recovery, as Eric mentioned earlier, the USA and Japan will proceed to recover in 2024, 2025 next year. But Europe is still not so clear. We may say state nature continues to upward growth for Europe.
For the second first half of next year, it may still just slightly grow, and we'll have a better growth momentum for the second half of next year. This is regarding for the Europe region. Then talk about the second question, 2.2, for China market and also the competition. Yes, we'll continue to drive the cost optimization progress to offer the more competitive product for China. Okay, this is for sure. The second, to establish the local supporting team, local growth team for China PD. As you may know, we have the product team in Kunshan, nearby Shanghai, about 200 people team from product development and also the R&D development. So China for China, not only for production, but also for the design, manufacturing, and production, and also services will all come out of our local growth team.
So this is the second action that we will take that is already in progress. Okay. So continue to drive the cost-effective optimization and also to establish the local growth team to support our China market. This is currently the action that we take already. Then also for the 2.3 question regarding the demand visibility from USA and also Europe. Yes, USA has a good visibility. The design-win, design-in pipeline is good. So that's also the reason we can foresee a very good growth momentum for 2025 and 2026. Okay. Europe, as I said, I can only say will be better than this year. Okay, 2025 will be better than this year, but maybe only slightly better in the first half than full recovery from second half. This is why I can answer now from the design pipeline visibility. Okay.
For sure that in Europe, currently the heavy product division and also our sector are working very hard to connect with our customers, push more design-in and design-win pipeline. Okay. This is regarding for the third question. And also for the 2.4 Edge AI contribution. Yes. This is a very big topic and also important topic for Advantech. About the contribution for Edge AI currently, as I remember that we have been delivered the currently the Edge AI revenue portion for this year is around 4%, 4% portion for Advantech total revenue. Okay. Then we are also very aggressive to set a target to growth to make a 15%-20% contribution from next year, 2025 and 2026. Okay. This is a very positive growth momentum and also forecast. There are some reasons.
As you may know, the top chip company, they are ready, whether from the GPU or from standalone NPU processing or GPU plus NPU integrated solution. The chip companies are ready. The operating systems are also ready. Domain demand market, for example, like our existing market from medical imaging processing or machine vision, they are our existing market. They adopt the AI technology into our edge computing. The growth momentum is very, very significant. Okay. Also, some new markets like robot AMR market also started to adopt our Edge AI solution. So we are very positive and also set a very good growth target for our team, entire Advantech product division and also sales team for next year. Okay. This is regarding for 2.4 question.
Yeah. Allow me to add some comment for the 2.4. From my point of view, the advancement of Edge AI in the Advantech platform, first, we're familiar with the Edge AI computing ecosystem. We have a strong relationship with NVIDIA, AMD, Intel, Qualcomm, MediaTek, and even the new players such as Hailo. So these are the first strength areas. And second is the rich portfolio for edge products. We provide a wide range of scalability of edge computing. So we hold strong positions in developed and mastered technology across various Edge AI silicon solutions. And the third is the diverse AI computing technology, including the ARM-based, Windows-based infrastructure. And last but not least, it's a good design service that will accelerate the integration of client AI application development. So I just want to add some comments for the Edge AI advantage from my point of view.
Okay. And then for the 3.1 question regarding for our WISE- IoT software platform, let me answer the question first. Yeah. We have a team, software team, very, very focused on the WISE- IoT software platform, targeted to our product line to support our customers, especially focused on some domain markets like you mentioned about the intelligent factory and also intelligent energy management system, IEMS. Okay. To this year, the revenue portion is still very small, very small, less than 1% of the total revenue. The revenue portion is very small today. But the growth rate, the growth momentum, especially for this year, is very, very good. I give you an example. Until year two, quarter three, okay, our iFactory solution business, we have achieved more than 60% growth. And also for our IEMS solution business, we have more than 80% growth this year. Very, very good growth momentum.
Even though the revenue portion is still small, but we have quite a good confidence. This year, we show a very good growth momentum, and regarding for their priority, I have to say the first of their priority from a business point of view is break-even. They need to break-even their business. That's their major focus, then for sure, we will continue to develop more solution business. iFactory and also IEMS is their current focus. They will continue to develop to provide more software solutions together with our hardware platform to promote our total solution to focus on the IoT solution business. This is their focus.
Yeah. And also from my point of view, I want to add some comments for this topic. Actually, just as Miller mentioned, we foresee a more robust demand for WISE-IoT this year, and particularly for IEMS, our iFactory solution. Most customers and use cases are in China, Taiwan, and the ASEAN region. Total revenue projection for WISE-IoT, this is around $10 million, $10 million. Yeah. It accounts for less than 1% of our total revenue. But the value of our WISE-IoT platforms relies heavily on our hardware, which is installed in the factory and facility and infrastructures. Therefore, in most cases, the software is not sold standalone, but bundled with our hardware platform. Also, the essential purpose of our software is not to generate significant revenue, but to sell more Advantech products.
Even in the long run, we still foresee the software platform will contribute only a single digit of our total revenue. But right now, yes, as Miller mentioned, the first priority is to break-even for the software we use. For the third Q2 question regarding the M&A for Aures. The merger with Aures will increase our top line by around 4%. The Aures revenue in 2026 is projected to be around $80 million. So it will increase our top line by around 4%. However, Aures GP is below Advantech, and its operating results were at the lowest. So it will bring negative impact to our consolidated GP and OP by around 0.2%, only 0.2%. Slight impact. And for Aures post-merger integration, we have appointed our SIoT VP, MC Chiang, as the CEO of Aures.
A lot of integration tasks are ongoing, including the new organization design, channel reinforcement, launch new sales incentive program, and plan for below two key strategic areas, including the first one is cross-selling synergies. As you may know, Aures has a strong sales presence in the retail sector in France, the U.K., Germany, and the U.S., which complements Advantech's retail sales network. We are mainly in Asia. The cross-selling synergy could exist for Advantech retail products to be sold either through Aures and Advantech existing sales network. So this is what we want to create a cross-selling synergy, and the second is regarding the product and operation synergies. Aures mainly focuses on POS and kiosk products and has established its branding in the retail product sector. Its unique design of POS and kiosk products can enrich Advantech product offering and design know-how.
But on the other hand, Aures can also leverage Advantech core engineering capacity and manufacturing facilities to create additional synergies. This has a great chance to improve their gross margins, also the OP margin as well. We have just started the first 90 days of the integration task, and the integration of the key tasks is on the right track. For example, right now we can check and daily trace Aures daily sales figures, including the booking number, shipping number, and backlog in our business intelligence system, in our internal BI system. This will allow us to review their performance more effectively. This is regarding the GP and OP impact will be around 0.2% in the current situation. Yeah.
Okay. So regarding for the 3.3 question, let me answer the first. Okay. It's about the competition. Yes. There are always some peer companies and also competition. They show the growth. And if they only focus on some individual market industry, for example, to focus on the medical market during the COVID period or also the material shortage, which can show the good growth momentum. Okay. But Advantech, as you may know, that we cover several vertical markets, not only focus on the individual vertical market, especially we are lagging behind in some important markets like automation and also the industrial server. Okay. Especially the automation industry. This is our traditional market, very important. Okay. And also industrial server. Okay. Then, of course, we realize the issue, and we start to push the internal organization. So we call it a sector-driven transformation. Okay.
Originally, we had the business group. We had the industrial IoT, embedded IoT, and service IoT. But now we made the decision to separate it as iSystems, iAutomation, embedded, and iService. The four sectors will have the dedicated product group, sales force, and also the focused leadership. Okay. Very important for our sector-driven transformation. Okay. We need to get back the leadership from our automation market and also the industrial server market. Then more additionally, there's some new market initiative. Okay. We are an edge computing leader for many years. And also the AI, the key technologies are already into the PC market, and soon will enter our industrial market as well. So the new corporate vision and also the new thing for Advantech 2025 this year will be the edge computing and edge AI. This will be our core corporate vision.
Our corporation will invest more resources and also begin to drive the new direction. Okay. So competition is always there. For Advantech, our product group and also sales team will work together as a sector to focus on the target sector, whatever from the existing sector, as I say, from medical equipment, industrial equipment, the new service market, or also some emerging market territory. We will put our resources on the new initial market and also the key technology for Edge AI as well. So those new initiatives will support us to back to growth from this year, 2025. Okay. So this is the comment from me.
Thank you, Miller. Let me add some comments for China. In China, we encountered a few local emerging players in competition. They are trying to gain the industrial market by providing low price and consumer-grade products. It worked in 2023, but as I note, their sales figures have declined a lot this year due to quality issues, and many customers are returning to Advantech to seek more reliable and long, long-distance support now. For other regions, the feedback from our sales heads remained positive. We have not lost any key customers even in the low season, and the new design-win and design-in shows promising signs this year, which will support our business growth in 2025 and 2026. Although we are in the recovery stage in China and our corporate project business is positive for the upcoming two years. Yeah. This is my comment.
Okay. Thanks, Eric and Miller, for the comprehensive answers. Now, we will open up the line for questions. So if you wish to ask a question, please use the raise your hand function, and we will read out your name, and then please unmute yourself and go with your question. Yeah. So maybe the first one for me is that I think in the past few days, all eyes have been on this U.S. election, and I think in the next few hours, probably we'll see the final outcome. So I'm wondering what would be the implications for Advantech in terms of your operations in the near term for your strategies in the mid to long term around this U.S. election. Thank you.
Let me try to answer this question first. Maybe Miller can add some comment later. The impact of U.S. election results is still not clear at this moment. I tried to remind when Trump was president at the United States from 2017 to 2021, it raised tariffs on China. We then worked with our clients who were concerned about the impact of the tariff. We transferred around 193 products, 193 models. They were produced in China to Taiwan, and the overall product cost increased by around 6%. But most clients were willing to absorb this transfer fee. So the impact on Advantech was limited. This happened in 2017 to 2021. Besides, we also applied a first sale rule to minimize the impact of our tariff on our clients. Yeah.
So for the election result, I'm not sure who will win this election, but for the past appearance, we are well prepared for the production transfer from China to Taiwan or to Japan because we have a unified EMS system, also the back-end ERP system. So it will take around one quarter, then we can prepare. We can start the product transfer from China to Taiwan or to Japan or even the third-party outsourced manufacturing in Malaysia. So this is my answer.
We foresee that the USA is a big country, also actually the big revenue contribution to Advantech. Since five years ago, we start to establish the sales office in North America, USA. Also you also heard that we have the big investment plan in Tustin, Southern California. Okay. We will build up a new headquarters and also the assembly line there. Okay. To fulfill our customer requirement, yes, some customers, they are asking for the build product in North America. That's the reason we have that capex investment plan there to service our key customers for different industry requirements. Yes, for USA, that we will continue to invest our resources, our people, our facility, and also our services, upgrade our services to support our customer well. Okay.
As we discussed about the information for our USA, our business team, currently their business progress is very positive, very positive. They are engaged with our key account customer very closely to get a new project pipeline. So that's the reason, yes, we continue to invest resources there. We also foresee the good feedback and growth momentum for USA for the next few years. That's the answer.
Thank you, Eric and Miller. So our next question is from Roshi Chatham. Roshi, please unmute yourself before you speak. Thank you.
Team, thank you for this very insightful presentation followed by the Q&A session. My first question was on our order book. I'm just curious, how do we calculate this figure which we share, given some of our business is directly with OEMs and some is with distributors or system integrators? That's the first question. And the sub-question is, how much is the typical conversion time from order books to booking our revenues in terms of months?
Sorry, can you repeat the first question?
Yeah. First question was, how do you sort of get visibility to calculate the order book number? Because some of our business, we directly work with our OEM customers who directly engage with us and place orders, while a lot of our business will actually go through our distributor partners, right, where our distributors will sort of just buy off the shelf and stock with them and then eventually supply to customers.
Let me try to answer this question. In our system, we have the order created; it's called the bookings. Because, for example, we have the how many amount order we received to date. This is what we call the bookings. And also we have the invoice shipping by this month or by to date. It's called shipments. So the BB ratio is the actual order create in our system, back-end system in our ERP system. So we have very precise figures for how many order amount we received to date and how many invoice we have shipped to date. So this is regarding the BB ratio. And for the design-in and design-win figures, because this is just in the early stage, we have a sales methodology. For example, we give the quotation to customer; then the conversion rate will be 25%.
And for the formal production invoice, the conversion rate will be 50%. And for the engineering sample, the conversion rate will be 75%. Something like that. So our design-in and design-win indicators is a leading KPI for us to foresee how many projects, how many key account projects status requirements of our leading indicators. So we formally list our BB ratio to our investor, but for design-in and design-win indicator, it's still for internal reference only. So this is very precise figures. Yeah. Not just predictions. It's real precise. Also, we have a strong methodology to calculate how to define the BB ratio, how to define the design-in and design-win. This is strong methodology. And for the design-in and design-win business, normally the mass production will delay around one quarter or even two quarters. And the project normally will last for three years. Yeah.
This is a normal case for the design and design win business. I'm not sure I have answered your question.
No, I think that's it. Thanks, thanks, Eric. I think that's very clear. I had a quick follow-up. Can I go ahead and ask that?
Yeah.
Yeah. I just wanted to get some sense of margins in different regions. So we know that China has been slightly challenged in terms of margins, but is it fair to say that U.S. will be the most profitable region followed by Europe and then China and other parts of Asia?
Yeah. In China, actually, we have lower our selling price around 2%. Our legal book shows the China region declined 2% of our gross margin. But for the other region, the selling price still remained the same. We also have cost reductions in our material side because normally the product cost, the material cost accounts for our product cost over 90%. The labor and overhead only accounts for 10%. So the material cost is quite important to Advantech. And we have continued to drive the cost efficiency, also the material price cost reductions. So this is the reason why we have a strong gross margin performance these years. Also, we consolidated all the plant in Taiwan just three months before we consolidated the Donghu plant into Linkou. Right now in Taiwan, we have only one manufacturing site in Linkou.
So this is the reason why we can maintain a very high gross margin, even though we are lowering our selling price in China.
That's very clear. Thank you, Eric. Thanks. Thanks so much.
Okay. Thanks, Eric. So again, we are in the Q&A session right now. So if you wish to ask a question, please raise your hand virtually and we will read out your name.
Yeah. Let me try to explain regarding the sector driven because a lot of investors are very concerned about our sector driven and what changed for the sector driven. Let me try to explain. Firstly, we changed the name of IIoT, EIoT, and SIoT into iSystems, iAutomation, Embedded and iService sectors. So maybe start from next year, we will report our sales by product to iSystems, iAutomation, and Embedded and iService sectors. Led by Linda, KC, our founder, also lead the iAutomation sector, Miller and MC respectively. Under the sector structure, each sector is configured with a dedicated product group, sales, and marketing team on the headquarters side to support its development of product and solutions. Also on the region side, the sector key account, sales, BDM, solution engineer, and the marketing team also report to the sector. So this is regarding the first change.
The second change areas, we established the emerging business unit. In headquarters side, we set up the EBO organizations. This step includes the Edge AI software team, Advantech Service Plus, and maybe for the new emerging platform, new emerging technology designed to foster innovation and cooperation with sectors. This business unit will be incubated and managed at a corporate level. Once that mature, we will dispatch them to the sector for day-to-day operation and management. So the second change area is we established the emerging business unit in the headquarters side. And the third change area is concerned about the common sales force, which includes the general account, e-commerce, and channel. In the past, each sector built up and managed its own online and channel sales in a different region. And in the future, we will set up the global channel and online sales teams in the headquarters.
In the region, we will consolidate each sector online and channel sales team as one team. The streamlined approach will enhance coordination and efficiency in our sales operations. So we will consolidate the GA, the general account, channel, and e-commerce as one team. In headquarters side, we have as key teams. In the region, we will consolidate to the one leadership. So a lot of KPI and incentive structure are under design and discussion. So maybe in addition to current KPI of revenue, profitability, and the revenue per headcount, we will also establish the incentive program to boost per sector selling and increase client figures. So this is our sector-driven key change areas. EIoT and rename the IIoT, IoT, and SIoT. Also, the general sales sectors will consolidate. Yeah.
Thanks, Eric. So final call for the questions on the line. Okay. It seems that there are no further questions. Eric and Miller, would you like to make some closing remarks?
Okay. As mentioned, our BB ratio continues to trend upwards quarter by quarter. Our design-in and design-win figures are promising. Although we are still facing uncertainty related to the U.S. election results and geopolitical issues, we are confident that we can achieve strong strengths in our top line and bottom line next year. We gratefully appreciate your constant support to Advantech. Thank you.
Thank you, Eric and Miller, and everyone for joining us today. We will wrap up the call here. Thank you. See you next quarter.
Thank you.
Thank you.