Zebra Technologies (ZBRA) Q1 Earnings & Revenues Decline Y/Y

Zebra Technologies Corporation ZBRA reported first-quarter 2024 adjusted earnings of $2.84 per share. The bottom line slumped 27.9% year over year.

Total revenues of $1.2 billion surpassed the Zacks Consensus Estimate of $1.1 billion. The top line plunged 16.4% year over year due to softness across end markets. Consolidated organic net sales declined 16.8% year over year. Foreign currency translation had an adverse impact of 0.4% on sales.

Segmental Performance

Revenues from the Asset Intelligence & Tracking (AIT) segment declined 24.9% year over year to $392 million. The Zacks Consensus Estimate for the same was pegged at $378 million.

Organic net sales decreased 25.3% in the AIT segment. Foreign-currency translation hurt segmental revenues by 0.4%.

The Enterprise Visibility & Mobility segment’s revenues totaled $783 million, down 11.3% year over year. The consensus estimate for the same was pegged at $768 million. Organic net sales declined 11.8%. Foreign-currency translation had an adverse impact of 0.5%.

Zebra Technologies Corporation Price, Consensus and EPS Surprise Zebra Technologies Corporation Price, Consensus and EPS Surprise

Zebra Technologies Corporation price-consensus-eps-surprise-chart | Zebra Technologies Corporation Quote

Margin Profile

In first-quarter 2024, Zebra Technologies’ cost of sales totaled $612 million, down 17.1% year over year. Total operating expenses decreased 8.6% year over year to $404 million.

ZBRA reported a net income of $115 million compared with $150 million in the year-ago period.

Balance Sheet and Cash Flow

Zebra Technologies had cash and cash equivalents of $127 million at the end of the first quarter compared with $137 million at the end of December 2023. Long-term debt totaled $1.8 billion compared with $2 billion at the end of December 2023.

In the first three months of 2024, Zebra Technologies generated net cash of $125 million in operating activities against $76 million cash used at the end of the year-ago period. The company incurred a capital expenditure of $14 million in the same time frame. Free cash inflow amounted to $111 million against free cash outflow of $92 million in the year-ago period.

Guidance

For the second quarter of 2024, Zebra Technologies, carrying a current Zacks Rank #3 (Hold) at present, expects net sales to decline 1-5% year over year. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Adjusted EBITDA margin is anticipated to be slightly above 19% for the quarter. Adjusted earnings per share (EPS) are expected to be in the band of $2.60-$2.90. 

For 2024, the company expects net sales to increase 1-5% from the prior-year level. Adjusted EPS is anticipated to be in the range of $11.25-$12.25 for the year. The effective tax rate is expected to be 17%. The adjusted EBITDA margin is anticipated to be almost 20%. ZBRA expects free cash flow to be at least $600 million for the year.

Performance of Other Industrial Companies

IDEX Corporation’s IEX first-quarter 2024 adjusted earnings of $1.88 per share surpassed the Zacks Consensus Estimate of $1.75. On a year-over-year basis, the bottom line decreased approximately 10.1%.

In the quarter, IDEX’s net sales of $800.5 million underperformed the consensus estimate of $805 million.  The top line also decreased 5.3% year over year.

A. O. Smith Corporation’s AOS first-quarter 2024 adjusted earnings of $1.00 per share surpassed the Zacks Consensus Estimate of 99 cents. The bottom line increased 6% on a year-over-year basis.

Net sales of $978.8 million missed the consensus estimate of $995 million. However, the top line inched up 1% year over year, driven by strong demand for commercial water heaters in North America.

W.W. Grainger, Inc. GWW has reported earnings per share of $9.62 in first-quarter 2024, beating the Zacks Consensus Estimate of $9.58. The bottom line improved 0.1% year over year.

Grainger’s quarterly revenues rose 3.5% year over year to $4.24 billion. The top line missed the consensus estimate of $4.27 billion.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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