Zebra Technologies Inc. (ZBRA) reported second-quarter fiscal 2024 net sales of $1.22 billion, up 0.2% year over year and beating analysts’ consensus estimates of $1.19 billion.
The mobile computing company reported adjusted EPS of $3.18, beating analysts’ consensus estimate of $3.06. Its shares rose after the announcement.
Consolidated organic net sales for the quarter decreased 0.3% compared to the same period last year.
Enterprise Visibility & Mobility (EVM) segment net sales increased 8.6% year over year to $820 million. Asset Intelligence & Tracking (AIT) segment net sales decreased 13.5% year over year to $397 million.
Adjusted gross margin improved 60 bps to 48.6%, primarily due to lower premium supply chain costs.
Adjusted EBITDA margin decreased 70 basis points to 20.5%, primarily due to higher operating expenses.
As of June 29, 2024, Zebra had cash and cash equivalents of $411 million.
The company reiterated that its productivity improvement plans and voluntary severance plans will cost $130 million in 2022. Net cost savings for the year will be $120 million.
“We saw a return to enterprise mobile computing growth across all vertical end markets, and continued cost controls and gross margin improvements delivered another consecutive quarter of improved profitability,” said Bill Burns, CEO of Zebra Technologies.
Outlook: Zebra expects third-quarter net sales to increase 25% to 28% year over year (versus the consensus estimate of $1.19 billion). It expects adjusted EPS of $3.00 to $3.30, compared to the market consensus of $3.06.
Zebra now expects fiscal 2024 net sales to grow 4% to 7% year over year (previously 1% to 5%), compared with the consensus of $4.77 billion. Adjusted EPS is now expected to be in the range of $12.30 to $12.90 (previously $11.25 to $12.25), compared with the consensus estimate of $11.92.
ZBRA PRICE TRACK: As of publication on Tuesday, Zebra shares were up 4% to $348.49.
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