STOCK TITAN

Zebra Technologies Announces Third-Quarter 2024 Results

Rhea-AI Impact
(Neutral)
Rhea-AI Sentiment
(Neutral)
Tags

Zebra Technologies (NASDAQ: ZBRA) reported strong Q3 2024 results with net sales of $1,255 million, up 31.3% year-over-year. Net income reached $137 million with earnings per diluted share of $2.64. The company saw significant improvements in gross margin, reaching 48.8%, and completed restructuring actions expected to generate $120 million in annual cost savings. Both Enterprise Visibility & Mobility and Asset Intelligence & Tracking segments showed strong organic growth of 33.0% and 25.8% respectively. The company raised its full-year outlook, projecting Q4 sales growth between 28-31% and expects full-year free cash flow of at least $850 million.

Zebra Technologies (NASDAQ: ZBRA) ha riportato risultati forti per il terzo trimestre del 2024, con vendite nette di 1.255 milioni di dollari, in aumento del 31,3% rispetto all'anno precedente. Il reddito netto ha raggiunto 137 milioni di dollari con utili per azione diluiti di 2,64 dollari. L'azienda ha registrato miglioramenti significativi nel margine lordo, arrivando al 48,8%, e ha completato azioni di ristrutturazione previste per generare 120 milioni di dollari di risparmi annuali sui costi. Sia il segmento di Visibilità e Mobilità per le Imprese che quello di Intelligenza delle Risorse e Tracciamento hanno mostrato una forte crescita organica del 33,0% e del 25,8% rispettivamente. L'azienda ha aumentato le sue previsioni per l'intero anno, prevedendo una crescita delle vendite del quarto trimestre compresa tra il 28% e il 31% e si aspetta un flusso di cassa libero annuale di almeno 850 milioni di dollari.

Zebra Technologies (NASDAQ: ZBRA) informó resultados sólidos para el tercer trimestre de 2024, con ventas netas de $1,255 millones, un aumento del 31.3% en comparación con el año anterior. El ingreso neto alcanzó $137 millones con ganancias por acción diluida de $2.64. La compañía vio mejoras significativas en el margen bruto, alcanzando el 48.8%, y completó acciones de reestructuración que se espera generen $120 millones en ahorros anuales de costos. Tanto el segmento de Visibilidad y Movilidad Empresarial como el de Inteligencia de Activos y Seguimiento mostraron un sólido crecimiento orgánico del 33.0% y 25.8% respectivamente. La compañía elevó su perspectiva para el año completo, proyectando un crecimiento en ventas del cuarto trimestre entre el 28% y el 31%, y espera un flujo de caja libre anual de al menos $850 millones.

제브라 테크놀로지스 (NASDAQ: ZBRA)는 2024년 3분기 강력한 실적을 보고하며, 순매출 12억 5,500만 달러를 기록하고 작년 대비 31.3% 증가했습니다. 순이익은 1억 3,700만 달러에 도달했으며, 희석 주당 순이익은 $2.64입니다. 회사는 총 매출 총이익률에서 48.8%를 기록하며 상당한 개선을 보였고, 연간 1억 2,000만 달러의 비용 절감 효과를 올릴 것으로 예상되는 구조조정 조치를 완료했습니다. 기업 가시성 및 이동성 부문과 자산 인텔리전스 및 추적 부문은 각각 33.0%와 25.8%의 강력한 유기적 성장을 보였습니다. 회사는 연간 전망을 상향 조정하며, 4분기 매출 성장률을 28%에서 31% 사이로 예상하고, 연간 자유 현금 흐름은 최소 8억 5,000만 달러에 이를 것으로 보고 있습니다.

Zebra Technologies (NASDAQ: ZBRA) a annoncé de solides résultats pour le troisième trimestre 2024, avec des ventes nettes de 1,255 million de dollars, en hausse de 31,3 % par rapport à l'année précédente. Le revenu net a atteint 137 millions de dollars avec un bénéfice par action diluée de 2,64 dollars. L'entreprise a observé des améliorations significatives de la marge brute, atteignant 48,8 %, et a complété des actions de restructuration censées générer 120 millions de dollars d'économies annuelles de coûts. Les segments de Visibilité et Mobilité d'Entreprise ainsi que d'Intelligence d'Actifs et de Suivi ont affiché une forte croissance organique de 33,0 % et 25,8 % respectivement. L'entreprise a relevé ses prévisions pour l'année entière, prévoyant une croissance des ventes pour le quatrième trimestre entre 28 % et 31 % et s'attend à un flux de trésorerie disponible d'au moins 850 millions de dollars pour l'année.

Zebra Technologies (NASDAQ: ZBRA) meldete starke Ergebnisse für das 3. Quartal 2024 mit Nettoumsätzen von 1.255 Millionen US-Dollar, was einem Anstieg von 31,3 % im Vergleich zum Vorjahr entspricht. Der Nettogewinn betrug 137 Millionen US-Dollar mit einem verwässerten Ergebnis je Aktie von 2,64 US-Dollar. Das Unternehmen verzeichnete signifikante Verbesserungen der Bruttomarge, die 48,8 % erreichte, und schloss Umstrukturierungsmaßnahmen ab, die voraussichtlich 120 Millionen US-Dollar an jährlichen Kosteneinsparungen generieren werden. Sowohl der Bereich Unternehmenssichtbarkeit und Mobilität als auch der Bereich Vermögensintelligenz und -verfolgung verzeichneten ein starkes organisches Wachstum von 33,0 % bzw. 25,8 %. Das Unternehmen hob seine Prognose für das Gesamtjahr an und erwartet im 4. Quartal ein Umsatzwachstum zwischen 28 und 31 % sowie einen jährlichen freien Cashflow von mindestens 850 Millionen US-Dollar.

Positive
  • Net sales increased 31.3% to $1,255 million
  • Net income improved to $137 million from a $15 million loss year-over-year
  • Gross margin expanded 410 basis points to 48.8%
  • Completed restructuring actions with $120 million expected annual cost savings
  • Strong organic growth across both business segments (EVM 33.0%, AIT 25.8%)
  • Free cash flow guidance raised to at least $850 million for full year
Negative
  • Total debt remains significant at $2,183 million

Insights

The Q3 2024 results showcase a remarkable turnaround for Zebra Technologies with significant improvements across key metrics. Net sales surged 31.3% to $1,255 million, while adjusted EBITDA margin expanded by 980 basis points to 21.4%. The successful completion of restructuring actions yielding $120 million in annualized savings demonstrates strong operational execution.

The balance sheet remains solid with $676 million in cash and impressive free cash flow generation of $666 million year-to-date. The robust Q4 guidance suggesting 28-31% growth and enhanced EBITDA margins near 22% indicates sustainable momentum. The company's improved profitability metrics and strong cash position provide significant flexibility for future growth initiatives and shareholder returns.

The substantial growth in both Enterprise Visibility & Mobility (33% organic growth) and Asset Intelligence & Tracking (25.8% organic growth) segments signals strong market demand for digital transformation solutions. The 430 basis point improvement in adjusted gross margin to 49.1% reflects enhanced pricing power and operational efficiency.

The robust outlook and completed restructuring indicate Zebra has successfully navigated supply chain challenges and is well-positioned to capitalize on increasing automation trends. The strong order momentum and margin expansion suggest sustainable competitive advantages in mission-critical enterprise solutions.

Third-Quarter Financial Highlights 

  • Net sales of $1,255 million; year-over-year increase of 31.3%
  • Net income of $137 million and net income per diluted share of $2.64
  • Non-GAAP diluted EPS increased year-over-year to $3.49
  • Adjusted EBITDA increased year-over-year to $268 million
  • Completed Exit and Restructuring actions to drive $120 million annualized net expense savings

LINCOLNSHIRE, Ill.--(BUSINESS WIRE)-- Zebra Technologies Corporation (NASDAQ: ZBRA), a leading digital solution provider enabling businesses to intelligently connect data, assets, and people, today announced results for the third quarter ended September 28, 2024.

“Our third quarter performance reflects excellent execution by our teams supported by continuing recovery in demand, strong gross margin, and the completion of our restructuring actions, enabling us to deliver sales and earnings results above the high end of our outlook,” said Bill Burns, Chief Executive Officer of Zebra Technologies. "Our relentless focus on innovation continues to drive our competitive differentiation and secure wins."

“We have increased our full year outlook for profitable growth to reflect our recent performance and continued momentum in demand," said Burns. "We continue to be well positioned to advance our industry leadership with our innovative solutions that digitize and automate our customers’ workflows across the supply chain.”

$ in millions, except per share amounts

3Q24

3Q23

Change

Select reported measures:

 

 

 

Net sales

$

1,255

 

$

956

 

31.3%

Gross profit

 

613

 

 

427

 

43.6%

Gross margin

 

48.8

%

 

44.7

%

410 bps

Net income (loss)

 

137

 

 

(15

)

1,013.3%

Net income (loss) margin

 

10.9

%

 

(1.6

)%

1250 bps

Net income (loss) per diluted share

$

2.64

 

$

(0.28

)

1,042.9%

 

 

 

 

Select Non-GAAP measures:

 

 

 

Adjusted net sales

$

1,255

 

$

956

 

31.3%

Organic net sales growth

 

 

30.6%

Adjusted gross profit

 

616

 

 

428

 

43.9%

Adjusted gross margin

 

49.1

%

 

44.8

%

430 bps

Adjusted EBITDA

 

268

 

 

111

 

141.4%

Adjusted EBITDA margin

 

21.4

%

 

11.6

%

980 bps

Non-GAAP net income

$

181

 

$

45

 

302.2%

Non-GAAP diluted earnings per share

$

3.49

 

$

0.87

 

301.1%

Net sales were $1,255 million in the third quarter of 2024 compared to $956 million in the prior year. Net sales in the Enterprise Visibility & Mobility ("EVM") segment were $845 million in the third quarter of 2024 compared to $632 million in the prior year. Asset Intelligence & Tracking ("AIT") segment net sales were $410 million in the third quarter of 2024 compared to $324 million in the prior year. Consolidated organic net sales for the third quarter of 2024 increased 30.6% year-over-year, with a 33.0% increase in the EVM segment and a 25.8% increase in the AIT segment.

Third quarter 2024 gross profit was $613 million compared to $427 million in the prior year. Gross margin increased to 48.8% for the third quarter of 2024 compared to 44.7% in the prior year due to volume leverage and business mix. Adjusted gross margin was 49.1% in the third quarter of 2024 compared to 44.8% in the prior year.

Operating expenses decreased to $422 million in the third quarter of 2024 from $439 million in the prior year, primarily due to lower restructuring costs and incremental savings largely attributed to our restructuring actions, partially offset by higher incentive compensation expense. Adjusted operating expenses increased to $364 million in the third quarter of 2024 from $334 million in the prior year.

In the third quarter, the company completed the actions under its previously announced Exit and Restructuring Plans generating approximately $120 million of net annualized cost savings primarily within Operating expenses, of which, the Company has realized $110 million in net savings to date.

Net income for the third quarter of 2024 was $137 million, or $2.64 per diluted share, compared to net loss of $15 million, or $0.28 loss per diluted share, in the prior year. Non-GAAP net income increased to $181 million for the third quarter of 2024, or $3.49 per diluted share, compared to $45 million, or $0.87 per diluted share, for the prior year.

Adjusted EBITDA for the third quarter of 2024 was $268 million, or 21.4% of adjusted net sales, compared to $111 million, or 11.6% of adjusted net sales in the prior year primarily due to higher gross margins and lower operating expense as a percentage of revenue.

Balance Sheet and Cash Flow

As of September 28, 2024, the Company had cash and cash equivalents of $676 million and total debt of $2,183 million.

For the first nine months of 2024, net cash provided by operating activities was $707 million and the Company invested $41 million in capital expenditures, resulting in free cash flow of $666 million. The Company also had net debt payments of $43 million and share repurchases of $16 million in the first nine months of 2024.

Outlook

The Company expects fourth quarter sales growth between 28% and 31% compared to the prior year. Foreign currency translation is expected to have approximately a 1 percentage point favorable impact.

Fourth quarter Adjusted EBITDA margin is expected to be approximately 22%. Non-GAAP diluted earnings per share are expected to be in the range of $3.80 to $4.00. This assumes an adjusted effective tax rate of approximately 17%.

Free cash flow for the full year is expected to be at least $850 million.

The Company does not provide a reconciliation for non-GAAP estimates on a forward-looking basis where it is unable to provide a meaningful or accurate calculation or estimation of reconciling items and the information is not available without unreasonable effort. This is due to the inherent difficulty of forecasting the timing or amount of the most directly comparable forward-looking GAAP financial measure as discussed under the "Forward-Looking Statements" caption below. This would include items that have not yet occurred, are out of the Company’s control and/or cannot be reasonably predicted, and that would impact diluted net earnings per share. For the same reasons, the Company is unable to address the probable significance of the unavailable information. Forward-looking non-GAAP financial measures provided without the most directly comparable GAAP financial measures may vary materially from the corresponding GAAP financial measures.

Conference Call Notification

Investors are invited to listen to a live webcast of Zebra’s conference call regarding the Company’s financial results. The conference call will be held today at 7:30 a.m. Central Time (8:30 a.m. Eastern Time). To view the webcast, visit the investor relations section of the Company’s website at investors.zebra.com.

About Zebra

Zebra (NASDAQ: ZBRA) helps organizations monitor, anticipate, and accelerate workflows by empowering their frontline and ensuring that everyone and everything is visible, connected and fully optimized. Our award-winning portfolio spans software to innovations in robotics, machine vision, automation and digital decisioning, all backed by a +50-year legacy in scanning, track-and-trace and mobile computing solutions. With an ecosystem of 10,000 partners across more than 100 countries, Zebra's customers include over 80% of the Fortune 500. Newsweek recently recognized Zebra as one of America's Most Loved Workplaces and Greatest Workplaces for Diversity, and we are on Fast Company's list of the Best Workplaces for Innovators. Learn more at www.zebra.com or sign up for news alerts. Follow Zebra’s Your Edge blog, LinkedIn, X and Facebook, and check out our Story Hub: Zebra Perspectives.

Forward-Looking Statements

This press release contains forward-looking statements, as defined by the Private Securities Litigation Reform Act of 1995, including, without limitation, the statements regarding the company’s outlook. Actual results may differ from those expressed or implied in the company’s forward-looking statements. These statements represent estimates only as of the date they were made. Zebra undertakes no obligation, other than as may be required by law, to publicly update or revise any forward-looking statements, whether as a result of new information, future events, changed circumstances or any other reason after the date of this release.

These forward-looking statements are based on current expectations, forecasts and assumptions and are subject to the risks and uncertainties inherent in Zebra’s industry, market conditions, general domestic and international economic conditions, and other factors. These factors include customer acceptance of Zebra’s offerings and competitors' offerings, and the potential effects of emerging technologies and changes in customer requirements. The effect of global market conditions, and the availability of credit and capital markets volatility may have adverse effects on Zebra, its suppliers and its customers. In addition, natural disasters, man-made disasters, public health issues (including pandemics), and cybersecurity incidents may have negative effects on Zebra's business and results of operations. Zebra's ability to purchase sufficient materials, parts, and components, and ability to provide services, software and products to meet customer demand could negatively impact Zebra's results of operations and customer relationships. Profits and profitability will be affected by Zebra’s ability to control manufacturing and operating costs. Because of its debt, interest rates and financial market conditions may also have an adverse impact on results. Foreign exchange rates, customs duties and trade policies may have an adverse effect on financial results because of the large percentage of Zebra's international sales. The impacts of changes in foreign and domestic governmental policies, regulations, or laws, as well as the outcome of litigation or tax matters in which Zebra may be involved are other factors that could adversely affect Zebra's business and results of operations. The success of integrating acquisitions could also adversely affect profitability, reported results and the company’s competitive position in its industry. These and other factors could have an adverse effect on Zebra’s sales, gross profit margins and results of operations and increase the volatility of Zebra's financial results. When used in this release and documents referenced, the words “anticipate,” “believe,” “outlook,” and “expect” and similar expressions, as they relate to the company or its management, are intended to identify such forward-looking statements, but are not the exclusive means of identifying these statements. Descriptions of certain risks, uncertainties and other factors that could adversely affect the company’s future operations and results can be found in Zebra’s filings with the Securities and Exchange Commission, including the company’s most recent Form 10-K and Form 10-Q.

Use of Non-GAAP Financial Information

This press release contains certain Non-GAAP financial measures, consisting of “adjusted net sales,” “adjusted gross profit,” “adjusted gross margin,” “EBITDA,” “Adjusted EBITDA,” “Adjusted EBITDA margin,” “Adjusted EBITDA % of adjusted net sales,” “Non-GAAP net income,” “Non-GAAP earnings per share,” “Non-GAAP diluted earnings per share,” “free cash flow,” “organic net sales,” “organic net sales growth,” “organic net sales growth (decline),” “organic net sales (decline) growth,” and “adjusted operating expenses.” Management presents these measures to focus on the on-going operations and believes it is useful to investors because they enable them to perform meaningful comparisons of past and present operating results. The company believes it is useful to present non-GAAP financial measures, which exclude certain significant items, as a means to understand the performance of its ongoing operations and how management views the business. Please see the “Reconciliation of GAAP to Non-GAAP Financial Measures” tables and accompanying disclosures at the end of this press release for more detailed information regarding non-GAAP financial measures herein, including the items reflected in adjusted net earnings calculations. These measures, however, should not be construed as an alternative to any other measure of performance determined in accordance with GAAP.

The company does not provide a reconciliation for non-GAAP estimates on a forward-looking basis (including the information under “Outlook” above) where it is unable to provide a meaningful or accurate calculation or estimation of reconciling items and the information is not available without unreasonable effort. This is due to the inherent difficulty of forecasting the timing or amount of various items that have not yet occurred, are out of the company’s control and/or cannot be reasonably predicted, and that would impact diluted net earnings per share, the most directly comparable forward-looking GAAP financial measure. For the same reasons, the company is unable to address the probable significance of the unavailable information. Forward-looking non-GAAP financial measures provided without the most directly comparable GAAP financial measures may vary materially from the corresponding GAAP financial measures.

As a global company, Zebra's operating results reported in U.S. dollars are affected by foreign currency exchange rate fluctuations because the underlying foreign currencies in which the company transacts change in value over time compared to the U.S. dollar; accordingly, the company presents certain organic growth financial information, which includes impacts of foreign currency translation, to provide a framework to assess how the company’s businesses performed excluding the impact of foreign currency exchange rate fluctuations. Foreign currency impact represents the difference in results that are attributable to fluctuations in the currency exchange rates used to convert the results for businesses where the functional currency is not the U.S. dollar. This impact is calculated by translating current period results at the currency exchange rates used in the comparable period in the prior year, rather than the exchange rates in effect during the current period. In addition, the company excludes the impact of its foreign currency hedging program in the prior year periods. The company believes these measures should be considered a supplement to and not in lieu of the company’s performance measures calculated in accordance with GAAP.

ZEBRA TECHNOLOGIES CORPORATION AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(In millions, except share data)

 

 

September 28,
2024

 

December 31,
2023

 

(Unaudited)

 

 

Assets

 

 

 

Current assets:

 

 

 

Cash and cash equivalents

$

676

 

 

$

137

 

Accounts receivable, net of allowances for doubtful accounts of $1 each as of September 28, 2024 and December 31, 2023

 

642

 

 

 

521

 

Inventories, net

 

639

 

 

 

804

 

Income tax receivable

 

67

 

 

 

63

 

Prepaid expenses and other current assets

 

109

 

 

 

147

 

Total Current assets

 

2,133

 

 

 

1,672

 

Property, plant and equipment, net

 

302

 

 

 

309

 

Right-of-use lease assets

 

173

 

 

 

169

 

Goodwill

 

3,895

 

 

 

3,895

 

Other intangibles, net

 

447

 

 

 

527

 

Deferred income taxes

 

501

 

 

 

438

 

Other long-term assets

 

239

 

 

 

296

 

Total Assets

$

7,690

 

 

$

7,306

 

Liabilities and Stockholders’ Equity

 

 

 

Current liabilities:

 

 

 

Current portion of long-term debt

$

89

 

 

$

173

 

Accounts payable

 

533

 

 

 

456

 

Accrued liabilities

 

490

 

 

 

504

 

Deferred revenue

 

432

 

 

 

458

 

Income taxes payable

 

18

 

 

 

7

 

Total Current liabilities

 

1,562

 

 

 

1,598

 

Long-term debt

 

2,080

 

 

 

2,047

 

Long-term lease liabilities

 

162

 

 

 

152

 

Deferred income taxes

 

66

 

 

 

67

 

Long-term deferred revenue

 

304

 

 

 

312

 

Other long-term liabilities

 

95

 

 

 

94

 

Total Liabilities

 

4,269

 

 

 

4,270

 

Stockholders’ Equity:

 

 

 

Preferred stock, $.01 par value; authorized 10,000,000 shares; none issued

 

 

 

 

 

Class A common stock, $.01 par value; authorized 150,000,000 shares; issued 72,151,857 shares

 

1

 

 

 

1

 

Additional paid-in capital

 

653

 

 

 

615

 

Treasury stock at cost, 20,609,801 and 20,772,995 shares as of September 28, 2024 and December 31, 2023, respectively

 

(1,871

)

 

 

(1,858

)

Retained earnings

 

4,697

 

 

 

4,332

 

Accumulated other comprehensive loss

 

(59

)

 

 

(54

)

Total Stockholders’ Equity

 

3,421

 

 

 

3,036

 

Total Liabilities and Stockholders’ Equity

$

7,690

 

 

$

7,306

 

ZEBRA TECHNOLOGIES CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

(In millions, except share data)

(Unaudited)

 

 

Three Months Ended

 

Nine Months Ended

 

September 28,
2024

 

September 30,
2023

 

September 28,
2024

 

September 30,
2023

Net sales:

 

 

 

 

 

 

 

Tangible products

$

1,019

 

 

$

729

 

 

$

2,931

 

 

$

2,885

 

Services and software

 

236

 

 

 

227

 

 

 

716

 

 

 

690

 

Total Net sales

 

1,255

 

 

 

956

 

 

 

3,647

 

 

 

3,575

 

Cost of sales:

 

 

 

 

 

 

 

Tangible products

 

526

 

 

 

419

 

 

 

1,539

 

 

 

1,559

 

Services and software

 

116

 

 

 

110

 

 

 

343

 

 

 

341

 

Total Cost of sales

 

642

 

 

 

529

 

 

 

1,882

 

 

 

1,900

 

Gross profit

 

613

 

 

 

427

 

 

 

1,765

 

 

 

1,675

 

Operating expenses:

 

 

 

 

 

 

 

Selling and marketing

 

151

 

 

 

138

 

 

 

449

 

 

 

445

 

Research and development

 

141

 

 

 

127

 

 

 

425

 

 

 

403

 

General and administrative

 

96

 

 

 

88

 

 

 

274

 

 

 

256

 

Amortization of intangible assets

 

29

 

 

 

26

 

 

 

80

 

 

 

78

 

Acquisition and integration costs

 

1

 

 

 

2

 

 

 

3

 

 

 

4

 

Exit and restructuring costs

 

4

 

 

 

58

 

 

 

17

 

 

 

82

 

Total Operating expenses

 

422

 

 

 

439

 

 

 

1,248

 

 

 

1,268

 

Operating income (loss)

 

191

 

 

 

(12

)

 

 

517

 

 

 

407

 

Other (loss) income, net:

 

 

 

 

 

 

 

Foreign exchange (loss) gain

 

(9

)

 

 

6

 

 

 

(6

)

 

 

2

 

Interest expense, net

 

(31

)

 

 

(16

)

 

 

(71

)

 

 

(69

)

Other expense, net

 

(2

)

 

 

(2

)

 

 

(13

)

 

 

(8

)

Total Other expense, net

 

(42

)

 

 

(12

)

 

 

(90

)

 

 

(75

)

Income (loss) before income tax

 

149

 

 

 

(24

)

 

 

427

 

 

 

332

 

Income tax expense (benefit)

 

12

 

 

 

(9

)

 

 

62

 

 

 

53

 

Net income (loss)

$

137

 

 

$

(15

)

 

$

365

 

 

$

279

 

Basic earnings (loss) per share

$

2.65

 

 

$

(0.28

)

 

$

7.09

 

 

$

5.44

 

Diluted earnings (loss) per share

$

2.64

 

 

$

(0.28

)

 

$

7.04

 

 

$

5.40

 

ZEBRA TECHNOLOGIES CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(In millions)

(Unaudited)

 

 

Nine Months Ended

 

September 28,
2024

 

September 30,
2023

Cash flows from operating activities:

 

 

 

Net income

$

365

 

 

$

279

 

Adjustments to reconcile net income to net cash provided by operating activities:

 

 

 

Depreciation and amortization

 

130

 

 

 

132

 

Share-based compensation

 

68

 

 

 

39

 

Deferred income taxes

 

(62

)

 

 

(35

)

Unrealized gain on forward interest rate swaps

 

(31

)

 

 

(34

)

Other, net

 

12

 

 

 

3

 

Changes in operating assets and liabilities:

 

 

 

Accounts receivable, net

 

(120

)

 

 

228

 

Inventories, net

 

161

 

 

 

7

 

Other assets

 

5

 

 

 

(25

)

Accounts payable

 

79

 

 

 

(402

)

Accrued liabilities

 

68

 

 

 

(79

)

Deferred revenue

 

(34

)

 

 

(12

)

Income taxes

 

25

 

 

 

(134

)

Settlement liability

 

(45

)

 

 

(135

)

Cash receipts on forward interest rate swaps

 

86

 

 

 

20

 

Other operating activities

 

 

 

 

3

 

Net cash provided by (used in) operating activities

 

707

 

 

 

(145

)

Cash flows from investing activities:

 

 

 

Purchases of property, plant and equipment

 

(41

)

 

 

(48

)

Proceeds from sale of short-term investments

 

2

 

 

 

 

Purchases of long-term investments

 

(3

)

 

 

(1

)

Net cash used in investing activities

 

(42

)

 

 

(49

)

Cash flows from financing activities:

 

 

 

Payment of debt issuance costs, extinguishment costs and discounts

 

(9

)

 

 

 

Payments of debt

 

(694

)

 

 

(221

)

Proceeds from issuance of debt

 

651

 

 

 

469

 

Payments for repurchases of common stock

 

(16

)

 

 

(52

)

Net payments related to share-based compensation plans

 

(27

)

 

 

(8

)

Change in unremitted cash collections from servicing factored receivables

 

(35

)

 

 

(48

)

Other financing activities

 

3

 

 

 

 

Net cash (used in) provided by financing activities

 

(127

)

 

 

140

 

Effect of exchange rate changes on cash and cash equivalents, including restricted cash

 

 

 

 

(2

)

Net increase (decrease) in cash and cash equivalents, including restricted cash

 

538

 

 

 

(56

)

Cash and cash equivalents, including restricted cash, at beginning of period

 

138

 

 

 

117

 

Cash and cash equivalents, including restricted cash, at end of period

$

676

 

 

$

61

 

Less restricted cash, included in Prepaid expenses and other current assets

 

 

 

 

 

Cash and cash equivalents at end of period

$

676

 

 

$

61

 

Supplemental disclosures of cash flow information:

 

 

 

Income taxes paid

$

90

 

 

$

227

 

Interest paid inclusive of forward interest rate swaps

$

3

 

 

$

80

 

Certain prior period amounts included in Net cash provided by (used in) operating activities have been reclassified to conform with the current period presentation.

ZEBRA TECHNOLOGIES CORPORATION AND SUBSIDIARIES

RECONCILIATION OF ORGANIC NET SALES GROWTH (DECLINE)

(Unaudited)

 

 

Three Months Ended

 

September 28, 2024

 

AIT

 

EVM

 

Consolidated

Reported GAAP Consolidated Net sales growth

26.5

%

 

33.7

%

 

31.3

%

Adjustments:

 

 

 

 

 

Impact of foreign currency translations (1)

(0.7

)%

 

(0.7

)%

 

(0.7

)%

Consolidated Organic Net sales growth

25.8

%

 

33.0

%

 

30.6

%

 

 

 

 

 

 

 

Nine Months Ended

 

September 28, 2024

 

AIT

 

EVM

 

Consolidated

Reported GAAP Consolidated Net sales (decline) growth

(8.1

)%

 

7.8

%

 

2.0

%

Adjustments:

 

 

 

 

 

Impact of foreign currency translations (1)

(0.6

)%

 

(0.4

)%

 

(0.5

)%

Consolidated Organic Net sales (decline) growth

(8.7

)%

 

7.4

%

 

1.5

%

(1)

Operating results reported in U.S. Dollars are affected by foreign currency exchange rate fluctuations. Foreign currency translation impact represents the difference in results that are attributable to fluctuations in the currency exchange rates used to convert the results for businesses where the functional currency is not the U.S. Dollar. This impact is calculated by translating the current period results at the currency exchange rates used in the comparable prior year period, inclusive of the Company’s foreign currency hedging program.

ZEBRA TECHNOLOGIES CORPORATION AND SUBSIDIARIES

RECONCILIATION OF GAAP TO NON-GAAP GROSS MARGIN

(In millions)

(Unaudited)

 

 

Three Months Ended

 

September 28, 2024

 

September 30, 2023

 

AIT

 

EVM

 

Consolidated

 

AIT

 

EVM

 

Consolidated

GAAP

 

 

 

 

 

 

 

 

 

 

 

Reported Net sales

$

410

 

 

$

845

 

 

$

1,255

 

 

$

324

 

 

$

632

 

 

$

956

 

Reported Gross profit

 

199

 

 

 

414

 

 

 

613

 

 

 

145

 

 

 

282

 

 

 

427

 

Gross Margin

 

48.5

%

 

 

49.0

%

 

 

48.8

%

 

 

44.8

%

 

 

44.6

%

 

 

44.7

%

 

 

 

 

 

 

 

 

 

 

 

 

Non-GAAP

 

 

 

 

 

 

 

 

 

 

 

Adjusted Net sales

$

410

 

 

$

845

 

 

$

1,255

 

 

$

324

 

 

$

632

 

 

$

956

 

Adjusted Gross profit (1)

 

200

 

 

 

416

 

 

 

616

 

 

 

145

 

 

 

283

 

 

 

428

 

Adjusted Gross Margin

 

48.8

%

 

 

49.2

%

 

 

49.1

%

 

 

44.8

%

 

 

44.8

%

 

 

44.8

%

 

 

 

 

 

 

 

 

 

 

 

 

 

Nine Months Ended

 

September 28, 2024

 

September 30, 2023

 

AIT

 

EVM

 

Consolidated

 

AIT

 

EVM

 

Consolidated

GAAP

 

 

 

 

 

 

 

 

 

 

 

Reported Net sales

$

1,199

 

 

$

2,448

 

 

$

3,647

 

 

$

1,305

 

 

$

2,270

 

 

$

3,575

 

Reported Gross profit

 

570

 

 

 

1,195

 

 

 

1,765

 

 

 

628

 

 

 

1,047

 

 

 

1,675

 

Gross Margin

 

47.5

%

 

 

48.8

%

 

 

48.4

%

 

 

48.1

%

 

 

46.1

%

 

 

46.9

%

 

 

 

 

 

 

 

 

 

 

 

 

Non-GAAP

 

 

 

 

 

 

 

 

 

 

 

Adjusted Net sales

$

1,199

 

 

$

2,448

 

 

$

3,647

 

 

$

1,305

 

 

$

2,270

 

 

$

3,575

 

Adjusted Gross profit (1)

 

572

 

 

 

1,200

 

 

 

1,772

 

 

 

629

 

 

 

1,050

 

 

 

1,679

 

Adjusted Gross Margin

 

47.7

%

 

 

49.0

%

 

 

48.6

%

 

 

48.2

%

 

 

46.3

%

 

 

47.0

%

(1)

Adjusted Gross profit excludes share-based compensation expense.

ZEBRA TECHNOLOGIES CORPORATION AND SUBSIDIARIES

RECONCILIATION OF GAAP TO NON-GAAP NET INCOME

(In millions, except share data)

(Unaudited)

 

 

Three Months Ended

 

Nine Months Ended

 

September 28,
2024

 

September 30,
2023

 

September 28,
2024

 

September 30,
2023

GAAP Net income (loss)

$

137

 

 

$

(15

)

 

$

365

 

 

$

279

 

Adjustments to Cost of sales(1)

 

 

 

 

 

 

 

Share-based compensation

 

3

 

 

 

1

 

 

 

7

 

 

 

4

 

Total adjustments to Cost of sales

 

3

 

 

 

1

 

 

 

7

 

 

 

4

 

Adjustments to Operating expenses(1)

 

 

 

 

 

 

 

Amortization of intangible assets

 

29

 

 

 

26

 

 

 

80

 

 

 

78

 

Acquisition and integration costs

 

1

 

 

 

2

 

 

 

3

 

 

 

4

 

Share-based compensation

 

24

 

 

 

19

 

 

 

78

 

 

 

42

 

Exit and restructuring costs

 

4

 

 

 

58

 

 

 

17

 

 

 

82

 

Total adjustments to Operating expenses

 

58

 

 

 

105

 

 

 

178

 

 

 

206

 

Adjustments to Other expense, net(1)

 

 

 

 

 

 

 

Amortization of debt issuance costs and discounts

 

 

 

 

1

 

 

 

1

 

 

 

2

 

Investment loss

 

 

 

 

 

 

 

6

 

 

 

1

 

Foreign exchange loss (gain)

 

9

 

 

 

(6

)

 

 

6

 

 

 

(2

)

Forward interest rate swap (gain)

 

 

 

 

(23

)

 

 

(31

)

 

 

(34

)

Total adjustments to Other expense, net

 

9

 

 

 

(28

)

 

 

(18

)

 

 

(33

)

Income tax effect of adjustments(2)

 

 

 

 

 

 

 

Reported income tax expense (benefit)

 

12

 

 

 

(9

)

 

 

62

 

 

 

53

 

Adjusted income tax

 

(38

)

 

 

(9

)

 

 

(101

)

 

 

(90

)

Total adjustments to income tax

 

(26

)

 

 

(18

)

 

 

(39

)

 

 

(37

)

Total adjustments

 

44

 

 

 

60

 

 

 

128

 

 

 

140

 

Non-GAAP Net income

$

181

 

 

$

45

 

 

$

493

 

 

$

419

 

 

 

 

 

 

 

 

 

GAAP earnings (loss) per share

 

 

 

 

 

 

 

Basic

$

2.65

 

 

$

(0.28

)

 

$

7.09

 

 

$

5.44

 

Diluted

$

2.64

 

 

$

(0.28

)

 

$

7.04

 

 

$

5.40

 

Non-GAAP earnings per share

 

 

 

 

 

 

 

Basic

$

3.52

 

 

$

0.87

 

 

$

9.58

 

 

$

8.16

 

Diluted

$

3.49

 

 

$

0.87

 

 

$

9.51

 

 

$

8.10

 

 

 

 

 

 

 

 

 

Basic weighted average shares outstanding(3)

 

51,567,216

 

 

 

51,336,645

 

 

 

51,480,812

 

 

 

51,380,876

 

Diluted weighted average and equivalent shares outstanding

 

51,918,055

 

 

 

51,336,645

 

 

 

51,845,572

 

 

 

51,717,731

 

(1)

Presented on a pre-tax basis.

(2)

Represents adjustments to GAAP income tax expense commensurate with pre-tax non-GAAP adjustments (including the resulting impacts to U.S. BEAT/GILTI provisions), as well as adjustments to exclude the impacts of certain discrete income tax items and incorporate the anticipated annualized effects of current year tax planning.

(3)

For GAAP purposes, in periods of a net loss, restricted stock and performance share awards, which are participating securities, are excluded from weighted-average shares outstanding and all unvested share-based awards were anti-dilutive and therefore excluded from diluted shares. For the three months ended September 30, 2023, Non-GAAP basic and diluted weighted average shares outstanding were 51,344,065 and 51,696,702, respectively.

ZEBRA TECHNOLOGIES CORPORATION AND SUBSIDIARIES

GAAP to NON-GAAP RECONCILIATION TO EBITDA

(In millions)

(Unaudited)

 

 

Three Months Ended

 

Nine Months Ended

 

September 28,
2024

 

September 30,
2023

 

September 28,
2024

 

September 30,
2023

GAAP Net income (loss)

$

137

 

 

$

(15

)

 

$

365

 

 

$

279

 

Add back:

 

 

 

 

 

 

 

Depreciation (excluding exit and restructuring)

 

16

 

 

 

17

 

 

 

50

 

 

 

52

 

Amortization of intangible assets

 

29

 

 

 

26

 

 

 

80

 

 

 

78

 

Total Other expense, net

 

42

 

 

 

12

 

 

 

90

 

 

 

75

 

Income tax expense (benefit)

 

12

 

 

 

(9

)

 

 

62

 

 

 

53

 

EBITDA (Non-GAAP)

 

236

 

 

 

31

 

 

 

647

 

 

 

537

 

 

 

 

 

 

 

 

 

Adjustments to Cost of sales

 

 

 

 

 

 

 

Share-based compensation

 

3

 

 

 

1

 

 

 

7

 

 

 

4

 

Total adjustments to Cost of sales

 

3

 

 

 

1

 

 

 

7

 

 

 

4

 

Adjustments to Operating expenses

 

 

 

 

 

 

 

Acquisition and integration costs

 

1

 

 

 

2

 

 

 

3

 

 

 

4

 

Share-based compensation

 

24

 

 

 

19

 

 

 

78

 

 

 

42

 

Exit and restructuring costs

 

4

 

 

 

58

 

 

 

17

 

 

 

82

 

Total adjustments to Operating expenses

 

29

 

 

 

79

 

 

 

98

 

 

 

128

 

Total adjustments to EBITDA

 

32

 

 

 

80

 

 

 

105

 

 

 

132

 

Adjusted EBITDA (Non-GAAP)

$

268

 

 

$

111

 

 

$

752

 

 

$

669

 

 

 

 

 

 

 

 

 

Adjusted EBITDA % of Adjusted Net Sales (Non-GAAP)

 

21.4

%

 

 

11.6

%

 

 

20.6

%

 

 

18.7

%

FREE CASH FLOW

 

 

Nine Months Ended

 

September 28,
2024

 

September 30,
2023

Net cash provided by (used in) operating activities

$

707

 

 

$

(145

)

Less: Purchases of property, plant and equipment

 

(41

)

 

 

(48

)

Free cash flow (Non-GAAP)(1)

$

666

 

 

$

(193

)

(1)

Free cash flow, a non-GAAP measure, is defined as Net cash provided by (used in) operating activities in a period minus purchases of property, plant and equipment (capital expenditures) made in that period. This measure does not represent residual cash flows available for discretionary expenditures as the measure does not deduct the payments required for debt service and other contractual obligations or payments for future business acquisitions. Therefore, we believe it is important to view free cash flow as a measure that provides supplemental information to our entire statements of cash flows.

 

Investors

Michael Steele, CFA, IRC

Vice President, Investor Relations

Phone: + 1 847 518 6432

InvestorRelations@zebra.com

Media

Therese Van Ryne

Senior Director, External Communications

Phone: + 1 847 370 2317

therese.vanryne@zebra.com

Source: Zebra Technologies Corporation

FAQ

What was Zebra Technologies (ZBRA) revenue in Q3 2024?

Zebra Technologies reported Q3 2024 revenue of $1,255 million, representing a 31.3% increase year-over-year.

How much cost savings will ZBRA's restructuring generate annually?

Zebra's completed Exit and Restructuring Plans are expected to generate approximately $120 million in net annualized cost savings.

What is ZBRA's Q4 2024 sales growth guidance?

Zebra Technologies expects Q4 2024 sales growth between 28% and 31% compared to the prior year.

What was Zebra Technologies' (ZBRA) EPS in Q3 2024?

Zebra reported Q3 2024 GAAP earnings per diluted share of $2.64 and non-GAAP EPS of $3.49.

Zebra Technologies Corporation

NASDAQ:ZBRA

ZBRA Rankings

ZBRA Latest News

ZBRA Stock Data

19.93B
51.17M
0.78%
92.1%
0.99%
Communication Equipment
General Industrial Machinery & Equipment
Link
United States of America
LINCOLNSHIRE