Zebra Technologies Corp - Class A
Q2 2026 Earnings
Market Reaction
Did ZBRA Beat Earnings? Q2 2026 Results
Zebra Technologies posted what it called record second-quarter 2026 results, reporting earnings of $6.35 per share on revenue of $1.56 billion, as broad-based demand across both operating segments powered 20.4% reported top-line growth year-over-year. The quarter's standout driver was a striking expansion in gross margin to 53.0% from 47.6% a year ago, aided in part by $73.00 million in IEEPA tariff recoveries, though investors will need to weigh that non-recurring benefit when assessing the durability of those margin gains. The Connected Frontline segment contributed $903.00 million in revenue, up 25.9% on a reported basis, while Asset Visibility and Automation added $654.00 million, growing 13.5%, with acquisition activity accounting for roughly 8.7 points of the overall reported growth rate. Encouraged by strong demand momentum, improving memory supply, and ongoing productivity gains, management raised its full-year 2026 outlook to sales growth of 14%-16%, adjusted EBITDA margin of 23.5%-24.0%, and non-GAAP diluted EPS of $20.75 to $21.25, with free cash flow expected to exceed $1.00 billion.
- Broad-based demand for innovative solutions across both segments and regions
- IEEPA tariff recoveries of $73 million boosted gross margin
- Favorable foreign currency exchange contributed to gross margin improvement
- Organic net sales growth of 9.2% consolidated, 7.5% CF, 11.4% AVA
- Contributions from business acquisitions added approximately 8.7 points to reported growth
- Progress on productivity and memory supply improvements
“Our record results reflect broad-based demand for our innovative solutions and excellent execution on our growth and profitability priorities. We delivered for our customers by leveraging our long-standing supplier relationships to support our growth. The momentum we see across our business underscores Zebra's position as the foundation for intelligent operations and frontline AI as customers digitize and automate environments.”
Zebra Technologies CEO, on the earnings call
Forward Guidance & Outlook
For Q3 2026, Zebra expects sales growth of 17%-20% year-over-year (including approximately 10.5 points from acquisitions, dispositions, and foreign currency), adjusted EBITDA margin of approximately 22%, and non-GAAP diluted EPS of $4.70-$4.90 assuming a 19% adjusted effective tax rate. For full year 2026, the company raised its outlook to sales growth of 14%-16% (including approximately 8 points from acquisitions, dispositions, and foreign currency), adjusted EBITDA margin of 23.5%-24.0%, non-GAAP diluted EPS of $20.75-$21.25, and free cash flow greater than $1 billion. Management cited strong demand momentum, productivity progress, and improving memory supply as supporting factors.
ZBRA YoY Financials
ZBRA Revenue by Segment
Figures from SEC filings and company reports. Not investment advice.