Zebra Technologies Announces 2Q 2024 Results

Zebra Technologies Corporation announced results for the second quarter ended June 29, 2024.

Net sales were $1,217 million in the second quarter of 2024 compared to $1,214 million in the prior year. Net sales in the Enterprise Visibility & Mobility (EVM) segment were $820 million in the second quarter of 2024 compared to $755 million in the prior year.

Asset Intelligence & Tracking (AIT) segment net sales were $397 million in the second quarter of 2024 compared to $459 million in the prior year. Consolidated organic net sales for the second quarter decreased 0.3% year-over-year, with an 8.2% increase in the EVM segment and a 14.4% decrease in the AIT segment.

Second quarter 2024 gross profit was $589 million compared to $581 million in the prior year. Gross margin increased to 48.4% for the second quarter of 2024 compared to 47.9% in the prior year. The increase was primarily due to lower premium supply chain costs and favorable impact from foreign currency changes. Adjusted gross margin was 48.6% in the second quarter of 2024 compared to 48.0% in the prior year.

“Our teams executed well during the quarter, enabling us to deliver sales and earnings results above the high end of our guidance ranges. We returned to growth in enterprise mobile computing across all our vertical end markets and delivered another quarter of sequential improvement in profitability as a result of our continued cost discipline and improved gross margin,” said Bill Burns, CEO of Zebra Technologies.

“Our increased full year outlook reflects our second quarter performance and early signs of momentum in demand led by mobile computing, balanced with continued cautious customer spending behavior, particularly for large orders, which have not yet returned to historical levels. 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.”

Net income for the second quarter of 2024 was $113 million, or $2.17 per diluted share, compared to net income of $144 million, or $2.78 per diluted share, for the prior year. Non-GAAP net income for the second quarter of 2024 decreased to $165 million, or $3.18 per diluted share, compared to $170 million, or $3.29 per diluted share, for the prior year.

Adjusted EBITDA for the second quarter of 2024 was $250 million, or 20.5% of adjusted net sales, compared to $257 million, or 21.2% of adjusted net sales for the prior year primarily due to higher operating expense as a percentage of revenue, partially offset by higher gross margin.

For the first six months of 2024, net cash provided by operating activities was $413 million and the company made capital expenditures of $24 million, resulting in free cash flow of $389 million.

The company has raised its guidance for the full year. It now expects net sales growth between 4% and 7% compared to the prior year. Free cash flow is now expected to be at least $700 million.