Why Is Zebra (ZBRA) Down 4.9% Since Last Earnings Report?
It has been about a month since the last earnings report for Zebra Technologies (ZBRA). Shares have lost about 4.9% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Zebra due for a breakout? Before we dive into how investors and analysts have reacted as of late, let’s take a quick look at its most recent earnings report in order to get a better handle on the important drivers.
Zebra Technologies Q2 Earnings Beat Estimates on Sales Growth, Outlook Raised
Zebra Technologies reported second-quarter 2026 adjusted earnings of $6.35 per share, which beat the Zacks Consensus Estimate of $4.35 by 46%. The bottom line increased 75.9% from $3.61 per share reported in the year-ago quarter.
Total revenues of $1.56 billion surpassed the consensus estimate of $1.50 billion by 3.9%. The top line increased 20.4% year over year, supported by broad-based growth across segments and regions. Consolidated organic net sales increased 9.2% year over year. Acquisitions contributed 8.7% to reported sales growth, while favorable foreign currency translation contributed 2.5%.
Segmental Performance
Effective from the fourth quarter of 2025, the company started reporting under two segments, namely Connected Frontline and Asset Visibility & Automation.
Revenues from the Connected Frontline segment rose 25.9% year over year to $903 million. Organic net sales increased 7.5%. The Zacks Consensus Estimate was pegged at $839 million.
The Asset Visibility & Automation segment’s revenues totaled $654 million, up 13.5% year over year. Organic net sales increased 11.4%. The Zacks Consensus Estimate was pegged at $662 million.
Margin Profile
In the second quarter of 2026, Zebra Technologies’ cost of sales totaled $732 million, up 8.1% year over year. Total operating expenses increased 16.4% year over year to $504 million.
The company reported net income of $233 million compared with $112 million in the year-ago quarter. Adjusted net income increased to $305 million from $186 million reported in the prior-year quarter.
Zebra Technologies’ Balance Sheet and Cash Flow
Zebra Technologies had cash and cash equivalents of $157 million at the end of the second quarter of 2026. Total debt amounted to $2.78 billion, while the net debt-to-adjusted EBITDA ratio was 1.9.
In the first six months of 2026, Zebra Technologies generated net cash of $387 million from operating activities compared with $325 million in the year-ago period. The company incurred capital expenditures of $26 million in the same time frame. Free cash flow amounted to $361 million compared with $288 million in the prior-year period.
