ManageEngine, the IT management division of Zoho Corp., is reducing its heavy reliance on the United States market. This move comes after the U.S. imposed 50% tariffs on India-sourced goods (though IT services are not yet covered). Currently, the U.S. contributes around 30% of ManageEngine’s revenue, making it their largest market. However, the company is now actively expanding into Latin America, the Middle East, and Africa to reduce dependency on one geography.
About ManageEngine (Zoho)
- Zoho Corporation: A global SaaS company headquartered in India, known for providing affordable business software to SMEs worldwide.
- ManageEngine: A division of Zoho that builds tools for IT operations, enterprise infrastructure, monitoring, helpdesk, cybersecurity, and password management.
Why Diversification is Needed
1. Impact of Tariffs and Geopolitical Risks
The 50% tariff announcement has increased uncertainty. Even though IT services are excluded for now, future risks make it clear that depending too much on the U.S. is not sustainable.
2. Reducing Over-dependence on the U.S.
With 30% of revenue coming from the U.S., a slowdown or regulatory hurdle there could hurt the company’s growth. Diversification is a strategic safety net.
3. Targeting New Markets
Regions like Latin America, the Middle East, and Africa are undergoing rapid digitization and are still underserved in terms of enterprise IT tools. These markets offer double-digit growth opportunities and higher SaaS adoption potential.
4. Growth Drivers in Emerging Regions
According to Zoho executives, demand is being fueled by:
- Rapid digitization of businesses.
- Regulatory compliance needs.
- AI-driven SaaS evolution, which is becoming a necessity across industries.
5. Proven Track Record of Adaptability
Zoho has a history of adapting during crises. For example, during the telecom crash in 2001, Zoho shifted focus and launched ManageEngine to serve SMEs—turning a challenge into a long-term success.
6. Future Outlook
India is also expected to become the second-largest market for ManageEngine soon. This will strengthen its revenue base further and reduce overdependence on the U.S.
Easy Takeaway
- The problem: Heavy dependence on the U.S. market amid tariff tensions.
- The solution: Diversifying into fast-growing, under-served regions.
- The driver: Digitization + compliance + AI adoption.
- The future: India to play a major role as a growth hub.
This makes ManageEngine’s strategy not just about reducing risk, but also about tapping into new opportunities where digital transformation is happening fastest.
Sources: Times of India, Economic Times, New Indian Express, Inc42. (Media reports)
