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• Revenue: Sales exceeded $1.3 billion, a 12% increase compared to the prior year.

• Adjusted EBITDA Margin: 22.3%, a 240 basis point increase from the previous year.

• Non-GAAP Diluted Earnings Per Share: $4.02, a 42% increase year-over-year.

• Gross Margin: Increased 150 basis points to 49.6%.

• Free Cash Flow: $158 million generated in the first quarter.

• Net Debt to Adjusted EBITDA Leverage Ratio: 1.2x at the end of Q1.

• Stock Repurchase: $125 million repurchased in Q1 and an additional $75 million in April.

• Asset Intelligence and Tracking Segment Sales: Increased 18%.

• Enterprise Visibility and Mobility Segment Sales: Grew 9%.

• Regional Sales Growth: North America 7%, EMEA 18%, Asia Pacific 13%, Latin America 18%.

• Tariff Impact: $70 million gross profit impact expected for the full year 2025.

• Full Year Sales Guidance: 3% to 7% growth, net neutral impact from FX and recent acquisitions.

• Full Year Free Cash Flow Expectation: At least $700 million.

• Warning! GuruFocus has detected 6 Warning Signs with ZBRA.

Release Date: April 29, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Zebra Technologies Corp (NASDAQ:ZBRA) reported a 12% year-over-year increase in sales, exceeding $1.3 billion for the quarter.

• The company achieved an adjusted EBITDA margin of 22.3%, marking a 240 basis point increase from the previous year.

• Non-GAAP diluted earnings per share rose by 42% to $4.02, surpassing the high end of their outlook.

• Zebra Technologies Corp (NASDAQ:ZBRA) experienced strong broad-based growth across all major product categories and regions.

• The company has made significant progress in diversifying its supply chain beyond China, enhancing its agility and resilience.

Negative Points

• Zebra Technologies Corp (NASDAQ:ZBRA) is facing a $70 million gross profit impact from tariffs for the full year, which is $50 million higher than prior guidance.

• The manufacturing vertical continues to lag behind other sectors, showing only high single-digit growth.

• The company is experiencing macroeconomic uncertainty, particularly related to global trade policies and tariffs.

• Despite strong demand, the Services and Software recurring revenue business grew only slightly in the quarter.

• Zebra Technologies Corp (NASDAQ:ZBRA) has not raised its full-year sales guidance due to the fluid global trade environment and related uncertainties.

Q & A Highlights

Q: Did you see any change in demand throughout the quarter or going into April, and what actions are you planning to mitigate tariff risks? A: William Burns, CEO, stated that demand remained strong through April, supported by strong retail year-end spending. Despite global trade uncertainty, customers have maintained positive capital budgets. Zebra is monitoring the global trade environment and has a dedicated team assessing potential impacts and designing mitigation strategies, including diversifying the supply chain and adjusting manufacturing footprints.