Zebra Technologies Raises Full-Year Outlook as Sales Climb 20%
The company reported non-GAAP diluted earnings per share of $6.35, a 75.9% increase over the prior year.
Zebra Technologies (ZBRA) reported second-quarter net sales of $1,557 million, representing a 20.4% increase from the $1,293 million recorded in the same period last year.
The tracking and visibility solutions provider saw a recovery in organic growth, with consolidated organic net sales rising 9.2% year-over-year. This growth was distributed across its primary business units, with the Asset Visibility & Automation segment increasing 11.4% and the Connected Frontline segment growing 7.5%.
Profitability metrics shifted upward as the company benefited from specific regulatory recoveries. Gross margin expanded 540 basis points to 53.0%, up from 47.6% in the prior year. This expansion was primarily due to favorable foreign currency exchange and IEEPA tariff recoveries. Total IEEPA tariff recoveries were $73 million, with $14 million of that amount received during the second quarter.
Adjusted EBITDA margin rose to 27.7%, an increase of 710 basis points from 20.6% a year ago. Non-GAAP diluted EPS rose to $6.35, compared to $3.61 in the second quarter of 2024.
Operating expenses rose to $504 million from $433 million in the prior year. The increase was primarily due to costs associated with acquired businesses, including the amortization of intangible assets.
Zebra increased its full-year 2025 outlook, projecting sales growth between 14% and 16% compared to the previous year. Full-year non-GAAP diluted EPS is expected to fall between $20.75 and $21.25, with an Adjusted EBITDA margin in the range of 23.5% to 24.0%.
The company returned capital to shareholders through buybacks, reporting $568 million in share repurchases for the first half of 2025. This total included $268 million spent during the second quarter.