10-Q · May 12, 2026
Zebra Technologies reported a strong first quarter in 2026, exceeding revenue and EPS expectations with net sales of $1.495 billion and a diluted EPS of $2.72. This performance marks a 14.3% increase in revenue compared…
Earnings analysis · 10-Q
ZBRA earnings analysis
Filed August 4, 2026 · Our reading of the company's report
The latest report
Zebra delivered a strong Q2, with revenue up 20.4% year over year to $1.557 billion, GAAP diluted EPS up to $4.85 from $2.19, and gross margin up 540 basis points to 53.0%. Both segments grew, with AVA producing 11.4%…
Read full summary
Zebra delivered a strong Q2, with revenue up 20.4% year over year to $1.557 billion, GAAP diluted EPS up to $4.85 from $2.19, and gross margin up 540 basis points to 53.0%. Both segments grew, with AVA producing 11.4% organic growth and CF delivering 7.5%, while six-month free cash flow reached $361 million. The principal offsets are a material but partly one-time $73 million tariff-refund benefit and elevated debt of $2.776 billion ahead of a planned second-half 2026 refinancing.
Gross and operating margin
How much of each revenue dollar the business keeps.
One point per quarterly or annual filing. Both margins are shares of that report's revenue.
From revenue to operating profit
Where each $100 of revenue went in this report.
Cost of sales, operating expenses, and what remained. Figures are rounded to whole dollars.
Where revenue came from
The business segments reported by the company.
Shares of the segments disclosed in this filing, largest first.
How we read each report
Our analysis across the last few reports.
Our model's reading of each filing, not the share price or the market's reaction. Annual and quarterly reports each occupy one position.
Reported figures
- Earnings per share
- $4.85
What stood out
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Revenue growth accelerated to $1.557B
Q2 net sales rose $264 million, or 20.4%, year over year to $1.557 billion; this also represents a $57 million, or 3.8%, increase from $1.500 billion in Q1 2026. Organic sales increased 9.2%.
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Profit and EPS rose sharply
GAAP diluted EPS more than doubled to $4.85 from $2.19 in Q2 2025, while operating income increased $138 million, or 75.4%, to $321 million. Operating margin expanded to 20.6% from 14.2% in the prior-year quarter.
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Gross margin expanded 540 bps
Gross margin expanded 540 basis points year over year to 53.0% from 47.6%, aided by a $73 million pretax expected IEEPA-tariff refund benefit and foreign currency. The company said it fully mitigated increased memory costs through price realization.
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Connected Frontline posted 25.9% growth
Connected Frontline revenue grew $186 million, or 25.9%, to $903 million, led by Elo Touch, mobile-computer sales, and foreign currency; segment operating income increased 54.2% to $219 million.
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AVA delivered strongest organic growth
AVA revenue increased $78 million, or 13.5%, to $654 million, with 11.4% organic growth driven by printing and machine-vision products. AVA operating income rose 79.4% to $192 million and gross margin rose 770 basis points to 56.3%.
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Cash generation and capex efficiency improved
Six-month operating cash flow increased $62 million to $387 million and free cash flow increased $73 million to $361 million. Capital expenditures were $26 million, equal to 1.7% of six-month sales of $3.052 billion.
What to watch
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Debt rose while funding buybacks
Total debt increased $265 million from $2.511 billion at December 31, 2025 to $2.776 billion at July 4, 2026. The company increased revolving-credit and receivables-facility borrowings to fund $568 million of year-to-date share repurchases.
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Large refinancing required in 2026
The Term Loan A and Revolving Credit Facility, which together include $2.275 billion classified as current debt, mature May 25, 2027. Management intends to refinance the Credit Facility in the second half of 2026, with timing and terms subject to debt-market conditions.
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Margin benefited from $73M tariff recovery
The 53.0% gross margin included a $73 million pretax benefit from expected refunds of previously paid IEEPA import tariffs, of which only $14 million cash was received during Q2. This benefit may not recur and collection of the remaining expected refund remains pending.
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Restructuring cash obligations remain
The company recorded an additional $8 million of severance and related costs in Q2 under the 2025 Productivity Plan, bringing cumulative one-time charges to $37 million. Most remaining obligations are expected to be paid in the second half of 2026.
Management's outlook
The 10-Q refers to the company's full-year 2026 financial outlook but does not provide quantitative outlook ranges in the filing; quantitative guidance was deferred to the earnings release/call.
Earlier filings 4
10-K · February 12, 2026
Zebra describes a strategy of expanding beyond traditional AIDC into end-to-end frontline solutions, using acquisitions and a re-segmentation (Connected Frontline and Asset Visibility & Automation) to accelerate…
10-Q · October 28, 2025
Zebra reported Q3 2025 net sales of $1,320 million and GAAP diluted EPS of $1.97. Revenue was up year-over-year and both segments expanded, but gross margin compressed slightly versus the prior-year quarter and…
10-Q · August 5, 2025
Zebra reported Q2 net sales of $1,293 million, up $76 million (+6.3%) versus the prior-year quarter, with gross profit of $616 million (gross margin 47.6%). Operating income rose to $183 million and diluted EPS was…
This is our reading of a public filing, not the filing itself. Analysis can contain errors; check the source document for full context.