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Sep 26, 2020
Zebra Q3 2020 Earnings Report
Announced third-quarter results with sales, EBITDA margin, and EPS exceeding outlook.
Key Takeaways
Zebra Technologies reported a slight increase in net sales, but experienced decreases in net income, EPS, and adjusted EBITDA. The company saw strong demand from large strategic customers and recovery through the channel.
Third-quarter net sales increased 0.2% year-over-year to $1,132 million.
Net income decreased 14.7% year-over-year to $116 million.
Non-GAAP diluted EPS decreased 4.7% year-over-year to $3.27.
Adjusted EBITDA decreased 10.5% year-over-year to $230 million.
Zebra
Zebra
Zebra Revenue by Segment
Revenue by Segment
EVM Revenue
CapyFin.comAIT Revenue
CapyFin.com Forward Guidance
The company expects adjusted net sales to increase 3% to 7% and adjusted EBITDA margin to be in the range of 21% to 22% for Q4 2020.
Positive Outlook
- Adjusted net sales are expected to increase 3% to 7% from Q4 2019.
- Includes an approximately 150 basis point additive impact from the Reflexis acquisition.
- Adjusted EBITDA margin is expected to be in the range of 21% to 22%.
- Non-GAAP earnings per diluted share are expected to be in the range of $3.70 to $3.90.
- Free cash flow is expected to be at least $650 million for the full year 2020, which is higher than full-year 2019.
Challenges Ahead
- Customers continue to navigate through a challenging macro environment.
- Expects adjusted net sales and adjusted EBITDA margin to be lower than last year.
- Includes approximately $9 million of premium freight expense.
- Assumes an adjusted effective tax rate of approximately 16%.
- One-time pre-tax charges of up to $20 million plus up to $10 million of capital expenditures related to sourcing diversification.
Revenue & Expenses
Visualization of income flow from segment revenue to net income