Zebra Technologies reported a strong third quarter, with sales up 22.3% from a year earlier as customers invested in automation and productivity. The company also raised its full-year outlook, though the announcement provided here does not include the revised forecast figures.
Growth was broad across segments and regions, and included a contribution from Elo Touch. Higher sales and net income came alongside a lower gross margin, while Zebra said pricing actions, efforts to secure memory supplies and operating leverage helped it support growth and maintain adjusted EBITDA margin year over year.
Key details
- Sales reached $1.614 billion, up 22.3% year over year. Organic net sales growth was 11.3%.
- Net income rose to $164 million from $101 million. Diluted earnings per share increased to $3.43 from $1.97.
- Non-GAAP diluted EPS was $4.95, up from a year earlier. Adjusted EBITDA increased to $349 million; the announcement did not provide the prior-year figure in the material supplied.
- Gross profit rose 16.4% to $738 million, but gross margin fell to 45.7% from 48.0%, a decline of 2.3 percentage points. Revenue growth therefore outpaced gross-profit growth.
- Zebra said Elo Touch contributed to double-digit growth, as customers prioritized automation of frontline operations.
- The company repurchased $75 million of shares in the quarter and more than $640 million in the first nine months of the year.
- Zebra raised its full-year outlook. The revised targets and the size of the increase are not specified in the announcement details provided here.
What changes for investors
The quarter showed faster revenue growth and higher reported profit, but also a lower gross margin. Zebra said pricing measures, stronger memory supply and operating leverage helped offset cost and supply pressures enough to keep adjusted EBITDA margin level with the prior year. The share repurchases also returned capital to shareholders while the company described itself as investing for growth.