Zebra Technologies Announces First-Quarter 2024 Results

-Zebra Technologies Corporation (NASDAQ: ZBRA), an innovator at the edge of the enterprise with solutions and partners that enable businesses to gain a performance edge, today announced results for the first quarter ended March 30, 2024.

“While our first quarter results continued to be impacted by broad-based softness across our end markets, we realized improvement in demand from the fourth quarter of 2023. Our teams executed well, driving significant sequential improvement in profitability, resulting from our cost restructuring actions and improved gross margin.” said Bill Burns, Chief Executive Officer of Zebra Technologies.

“Our increased 2024 outlook reflects a better-than-expected start to the year with modest recovery in demand and progress on our cost actions. We continue to be well positioned to extend our lead in the industry with our innovative solutions and remain focused on digitizing & automating our customers’ operations to solve their biggest challenges.”

Net sales were $1,175 million in the first quarter of 2024 compared to $1,405 million in the prior year. Net sales in the Enterprise Visibility & Mobility ("EVM") segment were $783 million in the first quarter of 2024 compared to $883 million in the prior year. Asset Intelligence & Tracking ("AIT") segment net sales were $392 million in the first quarter of 2024 compared to $522 million in the prior year. Consolidated organic net sales for the first quarter decreased 16.8% year-over-year, with a 11.8% decrease in the EVM segment and 25.3% decrease in the AIT segment.

First quarter 2024 gross profit was $563 million compared to $667 million in the prior year. Gross margin increased to 47.9% for the first quarter of 2024 compared to 47.5% in the prior year. The increase was primarily due to lower premium supply chain costs and improved software and service margins, partially offset by volume deleveraging. Adjusted gross margin was 48.1% in the first quarter of 2024 compared to 47.5% in the prior year.

Operating expenses decreased in the first quarter of 2024 to $404 million from $442 million in the prior year, primarily due to the impact of restructuring actions. Adjusted operating expenses decreased in the first quarter of 2024 to $348 million from $384 million in the prior year.

Second Quarter 2024

The Company expects second quarter 2024 net sales to decrease between 1% and 5% compared to the prior year. Foreign currency translation is expected to have an approximately 50 basis point favorable impact.

Adjusted EBITDA margin for the second quarter of 2024 is expected to be slightly above 19%. Non-GAAP diluted earnings per share are expected to be in the range of $2.60 to $2.90.

Full Year 2024

The Company expects full year 2024 net sales growth between 1% and 5% compared to the prior year. Foreign currency translation is expected to have a negligible impact.