#ZEBRA TECHNOLOGIES REVENUE FREE#

#ZEBRA TECHNOLOGIES REVENUE FREE#

The estimated free cash flow is also lowered from $650 million to $500 million, largely due to lower profitability and elevated inventory. Revenue is now expected to decline by 2% to 6%, down from the range of a 3% decline to a 1% growth previously announced. The company also lowered its full-year guidance amid softer-than-expected demand, as customer spending continues to slow. The non-GAAP diluted EPS was $3.94 compared to $4.01, down 1.7% YoY. The non-GAAP net income declined 4.7% YoY from $214 million to $204 million, mainly due to increased interest expenses and higher tax rates. The adjusted EBITDA margin also expanded 150 basis points from 19.9% to 21.4%. The adjusted EBITDA increased 5.6% YoY from $285 million to $301 million, largely attributed to the increase in gross profit. Adjusted operating expenses as a percentage of sales increased 130 basis points from 26% to 27.3%. Spending remains elevated due to increased investments and S&M (sales and marketing) initiatives, partially offset by a decline in G&A (general and administrative) expenses.

This resulted in the gross profit up 4.7% from $638 million to $668 million. The gross margin expanded 290 basis points from 44.6% to 47.5%, as the premium supply chain costs dropped 77.9% YoY, as shown in the chart below. The growth was mostly driven by the strength of its printing solutions, as supply constraints eased. The decline was partially offset by the AIT (asset intelligence & tracking) segment, which increased 28.4% from $394 million to $491 million, accounting for 34.8% of total sales. The demand for mobile computers remains weak, as customers continue to tighten on spending. The drop was mostly attributed to the EVM (enterprise visibility & mobility) segment, which declined 11.2% from $1.04 billion to $914 million, accounting for 64.8% of total sales. On an organic basis, net sales were down 0.3%. The company reported net sales of $1.41 billion, down 1.9% YoY (year over year) compared to $1.43 billion. Zebra Technologies announced its first-quarter earnings last week and the results are quite soft, as it continues to face increasing macro headwinds. According to the company, its TAM (total addressable market) is estimated to be approximately $30 billion with a solid long-term CAGR (compounded annual growth rate) of 5% to 7%. The company's product should see great long-term traction thanks to the rise of emerging industries like e-commerce, which presents a $15.6 trillion market, according to Grand View Research. These products allow businesses to cut down on labor and improve productivity and efficiency through better technologies. For instance, the company's products can be used for warehouse automation, asset tracking, inventory optimization, and more. I believe Zebra Technologies should continue to see durable growth in the long run as it plays an important role in mega-trends such as supply chain digitization, manufacturing automation, and IoT (internet of things). While the company is not that well-known, it actually has the leading market share in barcode printing, enterprise mobile computing, and barcode scanning. It has a heavy presence in industries such as e-commerce, retail, logistics, and manufacturing.

The company provides products such as mobile computers, printers, scanners, and RFID to front-line workers of different businesses. Zebra Technologies is an Illinois-based company that specializes in digitization and automation solutions. I like the risk-to-reward ratio at this price level therefore I rate the company as a buy.ĭata by YCharts Well-Positioned For Long Term Growth The current valuation is also very compressed and should offer meaningful upside potential if its financials improve. While the latest earnings were pretty weak, growth should start to rebound in FY24 due to easier comps and improved macro conditions. The company's fundamentals remain intact and it should continue to play an important role in digitization and automation. The company has been under pressure in the past two years due to macro headwinds such as elevated inflation and supply chain challenges, but I believe the weakness presents a great buying opportunity for patient investors. Despite the recent pullback, its share price still rose nearly 500% during the period, vastly outperforming the broader indices. Zebra Technologies ( NASDAQ: ZBRA) has been a great compounder in the past decade.

Zebra technologies revenue