Why Is Zebra Technologies Stock Shooting Higher Thursday?

Zebra Technologies Corp ZBRA reported a fourth-quarter FY23 net sales decline of 32.9% year-on-year to $1.01 billion, beating the consensus of $999.36 million. 

The adjusted EPS of $1.71 beat the consensus of $1.66. The stock price moved higher after the results.

Consolidated organic net sales for the quarter decreased by 33.1% Y/Y. 

Net sales in the Enterprise Visibility & Mobility (EVM) segment fell 32.8% Y/Y to $663 million. The net sales of the Asset Intelligence and Tracking (AIT) segment decreased by 33.1% Y/Y to $346 million.

The adjusted gross margin declined by 100 bps to 44.6%, primarily due to volume deleveraging. 

The adjusted EBITDA margin declined by 710 bps to 15.4% due to the hit in gross margin and higher exit and restructuring costs.

Zebra held $137 million in cash and equivalents as of December 31, 2023.

The 2022 Productivity Plan and Voluntary Retirement Plan will likely entail charges of $130 million, up from the prior $105 million, with net annualized expense savings of $120 million, an increase from the prior $100 million.

Outlook: Zebra expects first-quarter net sales to decrease between 17% and 20 % Y/Y or $1.124 billion – $1.166 billion compared to the consensus of $1.07 billion. It sees the adjusted EPS of $2.30 – $2.60 versus the street consensus of $2.08.

Zebra expects FY24 net sales change of (1)% – 3% Y/Y or $4.538 billion – $4.722 billion compared to the consensus of $4.590 billion. 

Price Action: ZBRA shares traded higher by 13.10% at $286.01 on the last check Thursday.