Epiroc: A Culture of Moving Mountains

Far out in Western Australia's Pilbara region, where red earth stretches to the horizon and you're more likely to cross paths with lizards than humans, something remarkable is taking place. Enormous driverless mining trucks are zipping by, carrying tons of iron ore around the clock with precision and safety no human could match. This is Hancock Iron Ore's Roy Hill mine, currently becoming the world's largest fully agnostic autonomous mine. The driverless operation is enabled by a Swedish company with strong ties to the Wallenberg family and Investor AB as its largest owner. This is the history and business of Epiroc – rewriting the rules of mining.

Key insights

• 152 years of industrial experience: Epiroc's roots trace back to Atlas Copco's founding in 1873 and its first rock drill, produced in 1905.

• The spinoff: Epiroc became independent in 2018 after Atlas Copco spun off its mining business area to unlock greater focus and growth.

• Automation leader: Over 3,450 driverless machines globally using Epiroc's technology makes it the global leader in mixed-fleet mining automation.

• The electrification revolution: 600+ battery-electric Epiroc vehicles operate at around 40 underground mine sites, cutting emissions and vastly reducing energy costs.

• Resilient, high-margin core: 66% of revenues come from aftermarket: service, tools, and parts that together form an economic moat with every machine deployed.

Founding story and the great spinoff

Epiroc's roots stretch back more than a century and a half, to the dawn of Sweden's industrial age. In 1873, Atlas Diesel (now Atlas Copco) was founded in Stockholm to supply equipment for the nation's rapidly expanding railways. But as the world continued to industrialize at the turn of the century, the now second-largest company by market cap in Sweden had expanded into other lucrative areas. One of them literally beneath the surface, producing its first rock drill in 1905.

Behind Atlas' rise stood one of Europe's most powerful industrial dynasties. Through Investor AB, the Wallenberg family bought their first shares in the company in 1918, and since then they haven't sold a single one – not in Atlas Copco, and not in Epiroc. For over a century, Investor AB has backed the two companies with patient capital that measures success in decades, not quarters.

Each breakthrough carried a distinctive Wallenberg management approach: give engineers freedom to innovate, hold them accountable for results, and let the best ideas rise regardless of hierarchy. This philosophy, coupled with much-needed funding through two world wars and countless economic crises, allowed Atlas Copco to grow into the Swedish engineering behemoth that would eventually give birth to Epiroc.

The ground-breaking Swedish Method was introduced in 1936, also referred to as "One man – one machine."

By the 2010s, Atlas Copco had become one of Sweden's largest companies by market cap, a global conglomerate spanning compressors, vacuum technology, industrial tools, and mining equipment. Yet its massive and broad success eventually created a paradox. Mining was competing for resources and focus against other divisions. The board realized that what had once been a strength, the diversity of the group, was now holding back mining's potential.

Before writing this article, we had the rare opportunity to sit down with Epiroc's CEO, Helena Hedblom, and VP Investor Relations & Media, Karin Larsson. When asked about the rationale behind the spinoff, Karin recalled a moment that perfectly captured the thinking at the time:

The decision came in 2017. Atlas Copco would spin off its mining business into a standalone company, one with the focus, culture, and independence to chart its own path. On June 18, 2018, Epiroc made its debut and began trading on the Nasdaq Stockholm.

The mining industry was standing at a crossroads at the time: aging infrastructure, rising energy costs, stricter environmental rules, and an acute shortage of skilled labor all weighed heavily. But advancement in new technologies – automation, digitalization, and electrification – promised answers. Epiroc could now pursue these opportunities with singular focus as a standalone entity.

Even the name spoke to its mission. Derived from "epi" (upon) and "roc" (rock), Epiroc symbolized mastery over the earth, and now stood ready with tools built for a digital age after decades of relentless focus on innovation. The spinoff was both a continuation and a rebirth – a company carrying forward Atlas Copco's heritage while carving out its own path. Looking back, Helena perfectly captured that turning point:

Epiroc CEO Helena Hedblom.

The new picks and shovels for modern mining

Epiroc doesn't dig for gold or extract copper. Instead, the company arms the world's mines with the machines and technology that make extraction more efficient, safer, and in many cases, possible at all. The Swedish industrial giant designs, manufactures, and services the specialized equipment that keeps mines running. From massive drilling rigs that bore through solid rock, to autonomous haul trucks that move thousands of tons daily, to battery-electric loaders that operate in the deepest underground chambers.

Epiroc supplies the picks, shovels, and intelligent systems of modern mining, then supports these assets throughout their operational lives with parts, service, and continuous technological upgrades.

At Boliden's Kristineberg mine in Sweden, the numbers tell a story that every mining executive dreams about. Since deploying Epiroc's battery-electric trolley truck system, productivity increased by 23% while speeds up the ramp improved by 50%. At the same time, maintenance costs dropped by 25%. But perhaps the most crucial breakthrough is consistency. These machines deliver the same performance on hour 23 as they do on hour one.

A different revolution unfolds thousands of miles away at Assmang's Black Rock mine in South Africa. Epiroc's battery-electric fleet operating in full production has delivered an 11% increase in tonnes per hour while cutting ventilation needs by 42% and reducing energy costs by 18% (sourced through Quartr Pro). The miners no longer work in diesel fumes, and the operation has eliminated over 8,200 tonnes of net CO2 emissions.

This is the essence of the value Epiroc unlocks: delivering focused, high-tech solutions to complex and costly operations. Its autonomous systems don't just replace human operators. They operate longer, safer, and with precision no human can match. Its electric vehicles don't just cut emissions, but also reduce energy costs, improve air quality, and lower the massive ventilation requirements that can account for 40% of a mine's energy budget.

The numbers across Epiroc's global footprint paint the picture clearly. Over 3,450 machines of Epiroc and other brands now use its autonomous technology to operate driverless in mines worldwide, collectively moving an estimated 2-3 billion tons of material. At around 40 sites across the world, over 600 battery-electric vehicles have eliminated substantial CO2 emissions while reducing operating costs for mines by 15-25% on average.

The Epiroc Boomer XE3.

Financials and business breakdown

Since the spinoff in June 2018, Epiroc has grown trailing twelve months (TTM) orders by 71%, revenues by 86%, and EBIT by 98% as of Q2 2025. In absolute terms, revenue and EBIT were 63.6 billion SEK (~$6B) and 12.4 billion SEK (~$1.2B) respectively TTM.

Since 2018, Epiroc has grown its revenue and EPS at a 9.2% and 9.8% CAGR respectively.

From its spinoff as a ~$12 billion company in 2018 to its ~$25 billion market cap today, Epiroc's growth story demonstrates how a truly focused business can capture the transformative trends reshaping an entire industry. Let's have a closer look at its two business segments.

Equipment & Service

At Epiroc's core sits its Equipment & Service segment, representing 76% of total sales and generating 48.3 billion SEK in revenue with a 23.5% EBIT margin TTM. This segment offers a comprehensive portfolio spanning over 150 automated equipment models, including surface drill rigs (SmartROC D65, Pit Viper series), underground equipment (drill rigs, loaders, and mine trucks such as the MT66 S eDrive – the world's largest underground truck at 66 tonnes), plus ventilation systems and exploration rigs. Equipment sales are roughly evenly split between surface and underground. But calling it just "equipment sales" misses the strategic brilliance.

This business area derives 55% of its revenue from service. When a mine buys an Epiroc drill rig, loader, or autonomous haulage system, they're entering an ecosystem. Every machine comes with telematics connectivity, joining what Helena described in the Q2'25 earnings call as "15,000 connected machines, giving us data and intelligence when it comes to both driving customer share, but also, of course, to work with our customers on productivity." (sourced through Quartr Pro).

This digital nervous system transforms traditional equipment sales into a platform business. The data flowing from Epiroc's connected machines enables predictive maintenance, optimization consulting, and performance upgrades that generate recurring revenue. It's a business model that Deere & Company pioneered in agriculture, now applied to 66-tonne mining trucks operating one mile underground. These are Epiroc's core equipment categories that drive mining and construction operations globally:

The Pit Viper

At the apex of Epiroc's surface equipment lineup stands the Pit Viper, a drill rig so massive it requires special permits to transport. These can drill holes up to 40 centimeters in diameter – roughly the width of a large pizza or car tire – and bore up to 20 meters in a single pass, deeper than a six-story building is tall.

The Pit Viper 351, one of the most sold models, now features an Automatic Bit Changer that eliminates human interaction with the drill string, boosting both safety and productivity. When Fortescue Metals ordered around 50 autonomous and electric Pit Viper and SmartROC D65 drill rigs from Epiroc in April 2025, the deal totaled ~2.2 billion SEK, representing roughly 45 million SEK per machine not counting service and support.

The Epiroc Pit Viper 231.

Scooptram

Size constraints demand different engineering underground. Epiroc's Scooptram loaders range from the compact ST2 to the mighty ST18, sized by the tons of rock their buckets can carry. The ST1030, the most sold loader, represents the sweet spot between capability and maneuverability in narrow underground tunnels.

The flagship Scooptram ST18 SG (Smart and Green) showcases how electrification transforms economics. This 18-ton capacity loader eliminates 365 tonnes of CO2 emissions annually compared to diesel equivalents while dramatically reducing ventilation costs – which often account for 40% of operational expenses in underground mining. For deep mines, these ventilation savings alone can justify the premium price.

Minetruck

The Minetruck MT42, a 42-metric-ton underground hauler, demonstrates Epiroc's focus on productivity optimization. The latest 66-ton MT66 S eDrive variant, powered by its strongest underground truck engine, achieves 11% faster up-ramp speed versus previous versions.

But the latest innovation lies in the MT42 SG trolley system, which runs 50% faster than diesel equivalents by combining battery power with overhead electrical lines. At Boliden's Kristineberg Mine, the trolley system increased productivity by 23% while reducing maintenance costs by 25%. When underground mines measure productivity in tons-per-hour and downtime in millions of lost revenue, these performance gains translate directly to bottom-line impact.

Diamec

In the exploration realm, the Diamec core drilling rig exemplifies Epiroc’s specialized engineering. Although drilling rigs and consumables such as drill bits and drill steel account for only 5% of orders, these rigs perform the crucial work of discovering tomorrow's mines.

The recently launched automated rod magazine for the Diamec range has gained strong traction by further eliminating manual handling and boosting productivity. These are critical improvements for exploration teams working in remote locations, where every efficiency gain matters.

Tools & Attachments

The company's Tools & Attachments segment represents 24% of total sales, generating 15.2 billion SEK in pure aftermarket revenue with a 10.5% EBIT margin TTM. The segment includes hydraulic attachments used in construction and urban mining, for instance in projects where concrete structures are dismantled and materials like steel and copper are recycled. It also covers specialized drilling tools for mining, creating a revenue stream that doesn't rely on Epiroc being the supplier of the original equipment.

This segment's strategic value lies in creating frequent customer touchpoints. While a drill rig might be purchased once every decade, the consumable tools require regular replacement, creating ongoing relationships with site operators and procurement teams. As automation in drilling becomes increasingly important and adopted, the requirements for high-quality drill bits are also rising.

This recurring interaction, combined with Epiroc's digital solutions for monitoring, optimization, and analytics, provides visibility into operational patterns that can inform broader equipment opportunities. The same personnel involved in daily tool purchases often influence multi-million-dollar equipment decisions.

The symbiotic advantage

Mining operations are risk-averse environments where equipment failure can cost millions in downtime. When Epiroc's autonomous haulage system delivers years of reliable performance, that credibility transfers across the entire product portfolio. Mine managers who trust Epiroc's ability to keep trucks running autonomously become more willing to try specialized drilling tools or hydraulic attachments bearing the same brand.

More strategically, every piece of Epiroc equipment creates service opportunities not just for that machine, but for the tools and attachments it uses. When a mining company signs one of Epiroc's comprehensive service contracts, it naturally extends to the specialized drill bits, cutting tools, and replacement parts those machines require. A single equipment service contract becomes a gateway to dozens of consumable tools.

The symbiotic relationship allows Epiroc to capture value across the entire mining operation lifecycle in ways that create compounding returns over time. It might enter through specialized drilling tools, expand into service contracts as trust builds, then win major equipment tenders when mines modernize. Each step deepens switching costs through integrated systems that become increasingly difficult for competitors to dislodge.

The aftermarket gold mine

For Epiroc, the most value is created after the initial sale happens. Every piece of Epiroc equipment becomes a recurring revenue stream through parts, service, and upgrades. Aftermarket represents 66% of total group sales, with the high-margin service alone accounting for 42% of total group revenue.

Epiroc's revenue segment split.

Service revenue includes five categories: replacement parts and kits, service agreements ranging from 24/7 on-site technicians to parts-only arrangements, circular services like midlife upgrades and component remanufacturing, custom-engineered solutions and training, and digital solutions. 32% of Epiroc's equipment is currently under some kind of service contract (up from 26% in June 2023), and machines under service agreements generate on average twice the revenue of those without.

When a mine invests in Epiroc equipment, they're often entering a decades-long partnership that continuously evolves with new software and smarter automation. From a business model perspective, this is arguably where the most crucial secret lies. Helena cuts straight to the point about where the company truly proves its value:

While both business segments are compelling in their own right, it's the 42% service revenue that represents the real gold mine and resilience. The key to this lies in Epiroc's more than 7,000 service technicians, a globally distributed expert network. This isn't just a maintenance force. It's more of a strategic asset.

Consider the loyalty mechanics: when an Epiroc technician prevents a catastrophic failure at 3 AM in a remote Australian mine, that relationship transcends typical vendor dynamics. Mining operations remember who keeps their equipment running when millions of dollars hang in the balance. This creates switching costs that extend far beyond contract terms – mine managers develop personal relationships with technicians who understand their specific operational challenges, geological conditions, and performance requirements.

Each of those 7,000+ technicians also becomes a sensor collecting operational data: which components fail under specific conditions, how different maintenance approaches affect uptime, what modifications customers make to optimize performance. These insights flow back to Epiroc's engineering teams, informing everything from product development to predictive maintenance algorithms.

The knowledge transfer creates value across all of its operations. A technique developed to solve a ventilation problem in a Chilean copper mine gets systematically deployed across similar operations in Mongolia, Canada, and South Africa. Pattern recognition across thousands of installations allows Epiroc to anticipate problems before they occur, transforming reactive maintenance into proactive optimization.

The larger the network, the more valuable the insights, the stickier the relationships, and the harder it becomes for peers to compete. While many companies can build mining equipment, they can't easily replicate a global expert network with decades of both underground and surface mining expertise and established customer relationships. Helena ads:

A control room overseeing Epiroc's automated production drilling operations.

Innovation and culture

Beyond the global network of service technicians lie two additional major strengths: a hidden R&D multiplier effect and a decades-cultivated culture of being truly decentralized and customer-centric.

The distributed innovation engine

Epiroc operates as what Helena describes as "much more of an assembler than a mass producer." With ~75% of equipment product costs coming from purchased components, Epiroc focuses on designing products and manufacturing only core components such as the rock drill, control systems, and the "brain" of the machine. The rest is sourced from its network of more than 2,400 specialized suppliers.

This creates what can be described as a distributed innovation engine. Epiroc's suppliers also invest in R&D, meaning the company’s own innovation efforts are amplified by continuous investment across its supplier network. This allows Epiroc to remain highly capital-efficient, with R&D spending at just 3% of sales and CAPEX at only 1–2%, while still accessing best-in-class components and technologies from thousands of suppliers around the world. As Karin puts it:

One could also argue that Epiroc's true R&D intensity is far higher than the reported 3%, since that figure applies only to the equipment business. In reality, Epiroc invests roughly 9% of its equipment revenues in R&D.

Culture as the secret weapon

Perhaps Epiroc's most durable advantage lies in its culture, defined by a customer-centric mindset and radical decentralization.

The culture and decentralization revealed itself during the pandemic when Epiroc demonstrated what financial discipline looks like in practice. By freeing up ~1 billion SEK in working capital in a very short time, the company showcased both the quality of customer relationships and the effectiveness of decentralized decision-making under pressure. Epiroc's field managers made immediate adjustments to collections, supplier payments, and production efficiency. This cultural foundation has deep roots:

This creates what the legendary former Atlas Copco HR leader Marianne Hamilton described as:

The river metaphor captures the internal trust and decentralization built over decades. Epiroc's managers typically grow up within the system, moving through roles every few years while building networks of relationships across the organization. This internal mobility creates a culture where everyone wants to do better than their predecessor.

What makes this particularly powerful is how incentives are linked to rational outcomes. Individual performance targets for managers tie directly to profitability and working capital metrics, creating organizational behavior that naturally optimizes for the financial outcomes that matter most. When every manager understands that faster collections, optimized supplier payments, and efficient production directly impact their evaluation, the entire organization becomes a cash flow optimization engine. Karin continues:

This operational discipline creates a compounding flywheel. Strong financial performance generates cash that funds R&D and service network expansion. Better products and service deepen customer relationships. Deeper relationships enable premium pricing and faster payment terms. Premium pricing and faster collections generate more cash to reinvest.

Competitors can replicate individual components such as hiring service technicians, increasing R&D spending, or adopting decentralized structures. But copying the integrated system requires decades of trust-building, cultural development, and operational refinement that cannot be accelerated through capital investment alone.

It's a fascinating idea: with time itself as a moat, it creates a barrier no amount of capital or strategy can cross in the short term, built only through decades of steady execution and earned trust.

Capital allocation: a disciplined approach to cycle management

Epiroc's capital allocation reflects long-term thinking with selective counter-cyclical elements, prioritizing relationship-building and balance sheet strength over pure market timing. The company demonstrated this approach through disciplined cash preservation during the pandemic, followed by strategic deployment during the recovery, while maintaining investments in R&D.

This methodology combines risk-conscious decision-making with opportunistic elements, always backed by a rock-solid balance sheet that even the Pit Viper wouldn't blast a hole into.

M&A through patient relationship building

Epiroc, much like its spin-off parent Atlas Copco, has made bolt-on and vertical acquisitions a key part of its strategy over the years. When asked about capital allocation and M&A, CEO Helena explained:

This multi-year relationship building creates a pipeline of pre-vetted acquisition targets where trust has already been established, giving Epiroc optionality to accelerate deal flow when market conditions are favorable.

While individual deals follow relationship timelines as described by Helena, Epiroc's aggregate deployment pattern reveals selective counter-cyclical characteristics. In 2021, as business fundamentals stabilized broadly and target companies had weathered the toughest pandemic storm, Epiroc was positioned to act decisively. Management guided confidently that "demand, both for equipment and aftermarket, will remain at a stable high level in the near term."

The 2021 acquisition activity of ~2.4 billion SEK was the highest yearly amount at that point in time, nearly 37x higher than the pandemic-reduced 2020 level, and more than double the 1.1 billion spent in 2019 at the pre-pandemic cycle peak. This aggressive deployment during the recovery phase rather than at peak conditions suggests counter-cyclical timing within Epiroc's relationship-driven acquisition framework. Since being spun off in 2018, Epiroc has completed 30 acquisitions, spending roughly 24 billion SEK in total.

Epiroc's cash spent on acquisitions since 2017.

The fortress balance sheet meets operational discipline

As mining companies slashed budgets and competitors froze R&D during the depths of the pandemic, Epiroc made a decision that epitomized long-term thinking. Despite a 12% revenue decline in 2020 and widespread uncertainty across the industry, the company increased its R&D spending slightly that year. In 2021, Epiroc raised it again to ~1.2 billion SEK, the highest level since the spin-off. Helena was clear in the 2020 annual report: "Innovation is in our DNA and we are investing more than we have ever done in R&D to stay ahead."

This positioned Epiroc to capitalize on the recovery while competitors remained defensive. But perhaps more telling was its quick and decisive operational response. Epiroc implemented efficiency actions within months of the pandemic's onset, announcing in Q1 2020 that it expected to save more than 500 million SEK annually starting from Q3 2020. As previously mentioned, the company also brought in about ~1 billion SEK in working capital in just a few quarters, showcasing its resilience during challenging times and positioning itself for acquisitions.

Epiroc has consistently maintained minimal leverage since the spinoff in 2018, creating the financial flexibility to act when others can't. At the end of 2019, at the pre-pandemic cycle peak, the company held a net debt-to-EBITDA ratio of only 0.05. Epiroc indeed practices counter-cyclical capital allocation. Not through market timing, but through the discipline of maintaining permanent optionality: consistently maintaining financial strength to enable selective action when others are constrained.

Closing thoughts

From the depths of South African mines to the headquarters in Stockholm, Epiroc has positioned itself at the intersection of multiple transformational forces reshaping the mining industry. The company's story transcends typical industrial narratives, this is a business that has systematically converted century-old mechanical expertise into a modern platform for digital transformation.

What emerges from examining Epiroc's business is a rare industrial company that has achieved the holy grail of strategy: creating competitive advantages that strengthen with scale. Each service call, each predictive maintenance insight, each equipment upgrade deepens the moat. The company that once simply sold machines to move rock is now the indispensable partner that defines how an entire industry operates globally.