Second-Quarter Financial Highlights
- Net sales of $1,377 million; year-over-year increase of
44%
- Net income of $219 million and net income per diluted share of
$4.07, year-over-year increases of 119% and 120%, respectively
- Non-GAAP diluted EPS increased 89.6% year-over-year to
$4.57
- Adjusted EBITDA increased 85.7% year-over-year to $325
million
Zebra Technologies Corporation (NASDAQ: ZBRA), an innovator at
the edge of the enterprise with solutions and partners that enable
businesses to gain a performance edge, today announced results for
the second quarter ended July 3, 2021.
"Our exceptional second quarter performance was driven by
continued broad-based demand for our solutions and excellent
operational execution. Despite ongoing industry-wide supply chain
challenges, our team met customers’ mission critical needs, while
delivering record sales and profitability that exceeded our
outlook,” said Anders Gustafsson, Chief Executive Officer of Zebra
Technologies. “While we continue to see extended lead times for
certain product components and escalating global shipping costs, we
enter the second half of the year with a strong order backlog and a
robust pipeline of business which supports the significant increase
to our full-year sales outlook. Additionally, we are excited about
our entry into vibrant markets that advance our Enterprise Asset
Intelligence vision, including our recent launch of fixed
industrial scanning & machine vision solutions, as well as our
pending acquisition of Fetch Robotics.”
$ in millions, except per share
amounts
2Q21
2Q20
Change
Select reported measures:
Net sales
$
1,377
$
956
44.0
%
Gross profit
658
419
57.0
%
Gross margin
47.8
%
43.8
%
400 bps
Net income
219
100
119.0
%
Net income margin
15.9
%
10.5
%
540 bps
Net income per diluted share
$
4.07
$
1.85
120.0
%
Select Non-GAAP measures:
Adjusted net sales
$
1,380
$
956
44.4
%
Organic net sales growth
39.8
%
Adjusted gross profit
663
422
57.1
%
Adjusted gross margin
48.0
%
44.1
%
390 bps
Adjusted EBITDA
325
175
85.7
%
Adjusted EBITDA margin
23.6
%
18.3
%
530 bps
Non-GAAP net income
$
247
$
130
90.0
%
Non-GAAP earnings per diluted share
$
4.57
$
2.41
89.6
%
Net sales were $1,377 million in the second quarter of 2021
compared to $956 million in the second quarter of 2020. Net sales
in the Enterprise Visibility & Mobility ("EVM") segment were
$959 million in the second quarter of 2021 compared with $683
million in the second quarter of 2020. Asset Intelligence &
Tracking ("AIT") segment net sales were $421 million in the second
quarter of 2021 compared to $273 million in the prior year period.
Consolidated organic net sales for the second quarter increased
39.8%. Second-quarter year-over-year organic net sales increased by
35.1% in the EVM segment and increased by 51.2% in the AIT
segment.
Second quarter 2021 gross profit was $658 million compared to
$419 million in the prior year period. Gross margin increased to
47.8% for the second quarter of 2021 compared to 43.8% in the prior
year period. This increase was primarily due to favorable business
mix, $12 million recovery of Chinese import tariffs, higher support
service margin and contribution from our higher margin business
acquisitions. This favorability was partially offset by higher
premium freight costs. Adjusted gross margin was 48.0% in the
second quarter of 2021 compared to 44.1% in the prior year
period.
Operating expenses increased in the second quarter of 2021 to
$411 million from $300 million in the prior year period, primarily
due to higher employee incentive-based compensation expense
associated with improved financial performance, the inclusion of
operating and amortization expenses associated with recently
acquired businesses, and increased investments in research and
development. Adjusted operating expenses increased in the second
quarter of 2021 to $356 million from $264 million in the prior year
period.
Net income for the second quarter of 2021 was $219 million, or
$4.07 per diluted share, compared to net income of $100 million, or
$1.85 per diluted share, for the second quarter of 2020. Non-GAAP
net income for the second quarter of 2021 increased to $247
million, or $4.57 per diluted share, compared to $130 million, or
$2.41 per diluted share, for the prior year period.
Adjusted EBITDA for the second quarter of 2021 increased to $325
million, or 23.6% of adjusted net sales, compared to $175 million,
or 18.3% of adjusted net sales, for the second quarter of 2020 due
to higher gross profits and lower operating expenses as a
percentage of sales.
Balance Sheet and Cash Flow
As of July 3, 2021, the company had cash and cash equivalents of
$318 million and total debt of $996 million.
For the first six months of 2021, the company generated $539
million of operating cash flow and incurred capital expenditures of
$25 million, resulting in free cash flow of $514 million. The
company also acquired Adaptive Vision for $18 million and made $17
million in venture investments.
For the first six months of 2021, the company made net debt
repayments of $256 million. Additionally, the company made $25
million of share repurchases in the first six months under its
existing authorization.
Outlook
Third Quarter 2021
The company expects third quarter 2021 adjusted net sales to
increase 21% to 25% from the third quarter of 2020 as we continue
to experience strong broad-based demand for our solutions as the
global economy continues to recover from the pandemic. This
expectation includes an approximately 3 percentage point additive
impact from the Reflexis acquisition and foreign currency
translation and reflects industry-wide supply chain challenges.
Adjusted EBITDA margin for the third quarter of 2021 is expected
to be approximately 20% to 21%, which includes approximately $45
million of premium freight expense. Non-GAAP earnings per diluted
share are expected to be in the range of $3.90 to $4.10. This
assumes an adjusted effective tax rate of approximately 18% to
19%.
Full-Year 2021
The Company now expects adjusted net sales to increase 23% to
25% from 2020, which includes an approximately 3 percentage point
additive impact from business acquisitions and foreign currency
translation and reflects industry-wide supply chain challenges.
Adjusted EBITDA margin is expected to be approximately 22% to
23%, which includes $135-140 million of premium freight
expense.
Free cash flow is now expected to be at least $900 million.
The outlook amounts provided above do not include any projected
results from the acquisition of Fetch Robotics, which is expected
to close in the third quarter of 2021.
The company does not provide a reconciliation for non-GAAP
estimates on a forward-looking basis where it is unable to provide
a meaningful or accurate calculation or estimation of reconciling
items and the information is not available without unreasonable
effort. This is due to the inherent difficulty of forecasting the
timing or amount of the most directly comparable forward-looking
GAAP financial measure as discussed under the "Forward-Looking
Statements" caption below. This would include items that have not
yet occurred, are out of the company’s control and/or cannot be
reasonably predicted, and that would impact diluted net earnings
per share. For the same reasons, the company is unable to address
the probable significance of the unavailable information.
Forward-looking non-GAAP financial measures provided without the
most directly comparable GAAP financial measures may vary
materially from the corresponding GAAP financial measures.
Conference Call Notification
Investors are invited to listen to a live webcast of Zebra’s
conference call regarding the company’s financial results for the
second quarter of 2021. The conference call will be held today,
Tuesday, August 3, at 7:30 a.m. Central Time (8:30 a.m. Eastern
Time). To view the webcast, visit the investor relations section of
the company’s website at investors.zebra.com.
About Zebra
Zebra (NASDAQ: ZBRA) empowers the front line in
retail/e-commerce, manufacturing, transportation and logistics,
healthcare, public sector and other industries to achieve a
performance edge. With more than 10,000 partners across 100
countries, Zebra delivers industry-tailored, end-to-end solutions
to enable every asset and worker to be visible, connected and fully
optimized. The company’s market-leading solutions elevate the
shopping experience, track and manage inventory as well as improve
supply chain efficiency and patient care. In 2020, Zebra made
Forbes Global 2000 list for the second consecutive year and was
listed among Fast Company’s Best Companies for Innovators. For more
information, visit www.zebra.com or sign up for our news alerts.
Participate in Zebra’s Your Edge blog, follow the company on
LinkedIn, Twitter and Facebook, and check out our Story Hub: Zebra
Perspectives.
Forward-Looking Statements
This press release contains forward-looking statements, as
defined by the Private Securities Litigation Reform Act of 1995,
including, without limitation, the statements regarding the
company’s outlook. Actual results may differ from those expressed
or implied in the company’s forward-looking statements. These
statements represent estimates only as of the date they were made.
Zebra undertakes no obligation, other than as may be required by
law, to publicly update or revise any forward-looking statements,
whether as a result of new information, future events, changed
circumstances or any other reason after the date of this
release.
These forward-looking statements are based on current
expectations, forecasts and assumptions and are subject to the
risks and uncertainties inherent in Zebra’s industry, market
conditions, general domestic and international economic conditions,
and other factors. These factors include customer acceptance of
Zebra’s hardware and software products and competitors’ product
offerings, and the potential effects of technological changes. The
continued uncertainty over future global economic conditions, the
availability of credit and capital markets volatility may have
adverse effects on Zebra, its suppliers and its customers. In
addition, a disruption in our ability to obtain products from
vendors as a result of supply chain constraints, natural disasters,
public health issues (including pandemics), or other circumstances
could restrict sales and negatively affect customer relationships.
Profits and profitability will be affected by Zebra’s ability to
control manufacturing and operating costs. Because of its debt,
interest rates and financial market conditions will also have an
impact on results. Foreign exchange rates will have an effect on
financial results because of the large percentage of our
international sales. The outcome of litigation in which Zebra may
be involved is another factor. The success of integrating
acquisitions could also affect profitability, reported results and
the company’s competitive position in its industry. These and other
factors could have an adverse effect on Zebra’s sales, gross profit
margins and results of operations and increase the volatility of
our financial results. When used in this release and documents
referenced, the words “anticipate,” “believe,” “outlook,” and
“expect” and similar expressions, as they relate to the company or
its management, are intended to identify such forward-looking
statements, but are not the exclusive means of identifying these
statements. Descriptions of the risks, uncertainties and other
factors that could affect the company’s future operations and
results can be found in Zebra’s filings with the Securities and
Exchange Commission, including the company’s most recent Form 10-K
and Form 10-Q.
Use of Non-GAAP Financial Information
This press release contains certain Non-GAAP financial measures,
consisting of “adjusted net sales,” “adjusted gross profit,”
“EBITDA,” “Adjusted EBITDA,” “Non-GAAP net income,” “Non-GAAP
earnings per share,” “free cash flow,” “organic net sales growth,”
and “adjusted operating expenses.” Management presents these
measures to focus on the on-going operations and believes it is
useful to investors because they enable them to perform meaningful
comparisons of past and present operating results. The company
believes it is useful to present non-GAAP financial measures, which
exclude certain significant items, as a means to understand the
performance of its ongoing operations and how management views the
business. Please see the “Reconciliation of GAAP to Non-GAAP
Financial Measures” tables and accompanying disclosures at the end
of this press release for more detailed information regarding
non-GAAP financial measures herein, including the items reflected
in adjusted net earnings calculations. These measures, however,
should not be construed as an alternative to any other measure of
performance determined in accordance with GAAP.
The company does not provide a reconciliation for non-GAAP
estimates on a forward-looking basis (including the information
under “Outlook” above) where it is unable to provide a meaningful
or accurate calculation or estimation of reconciling items and the
information is not available without unreasonable effort. This is
due to the inherent difficulty of forecasting the timing or amount
of various items that have not yet occurred, are out of the
company’s control and/or cannot be reasonably predicted, and that
would impact diluted net earnings per share, the most directly
comparable forward-looking GAAP financial measure. For the same
reasons, the company is unable to address the probable significance
of the unavailable information. Forward-looking non-GAAP financial
measures provided without the most directly comparable GAAP
financial measures may vary materially from the corresponding GAAP
financial measures.
As a global company, Zebra's operating results reported in U.S.
dollars are affected by foreign currency exchange rate fluctuations
because the underlying foreign currencies in which the company
transacts change in value over time compared to the U.S. dollar;
accordingly, the company presents certain organic growth financial
information, which includes impacts of foreign currency
translation, to provide a framework to assess how the company’s
businesses performed excluding the impact of foreign currency
exchange rate fluctuations. Foreign currency impact represents the
difference in results that are attributable to fluctuations in the
currency exchange rates used to convert the results for businesses
where the functional currency is not the U.S. dollar. This impact
is calculated by translating current period results at the currency
exchange rates used in the comparable period in the prior year,
rather than the exchange rates in effect during the current period.
In addition, the company excludes the impact of its foreign
currency hedging program in the prior year periods. The company
believes these measures should be considered a supplement to and
not in lieu of the company’s performance measures calculated in
accordance with GAAP.
ZEBRA TECHNOLOGIES CORPORATION
AND SUBSIDIARIES
CONSOLIDATED BALANCE
SHEETS
(In millions, except share
data)
July 3, 2021
December 31, 2020
(Unaudited)
Assets
Current assets:
Cash and cash equivalents
$
318
$
168
Accounts receivable, net of allowances for
doubtful accounts of $1 million as of July 3, 2021 and December 31,
2020, respectively
567
508
Inventories, net
485
511
Current income taxes
54
16
Prepaid expenses and other current
assets
102
70
Total Current assets
1,526
1,273
Property, plant and equipment, net
270
274
Right-of-use lease assets
125
135
Goodwill
2,989
2,988
Other intangibles, net
372
402
Deferred income taxes
131
139
Other long-term assets
180
164
Total Assets
$
5,593
$
5,375
Liabilities and Stockholders’ Equity
Current liabilities:
Current portion of long-term debt
$
47
$
364
Accounts payable
597
601
Accrued liabilities
524
559
Deferred revenue
348
308
Income taxes payable
34
19
Total Current liabilities
1,550
1,851
Long-term debt
944
881
Long-term lease liabilities
118
129
Long-term deferred revenue
299
273
Other long-term liabilities
93
97
Total Liabilities
3,004
3,231
Stockholders’ Equity:
Preferred stock, $.01 par value;
authorized 10,000,000 shares; none issued
—
—
Class A common stock, $.01 par value;
authorized 150,000,000 shares; issued 72,151,857 shares
1
1
Additional paid-in capital
427
395
Treasury stock at cost, 18,748,564 and
18,689,775 shares as of July 3, 2021 and December 31, 2020,
respectively
(984
)
(919
)
Retained earnings
3,183
2,736
Accumulated other comprehensive loss
(38
)
(69
)
Total Stockholders’ Equity
2,589
2,144
Total Liabilities and Stockholders’
Equity
$
5,593
$
5,375
ZEBRA TECHNOLOGIES CORPORATION
AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF
OPERATIONS
(In millions, except share
data)
(Unaudited)
Three Months Ended
Six Months Ended
July 3, 2021
June 27, 2020
July 3, 2021
June 27, 2020
Net sales:
Tangible products
$
1,192
$
811
$
2,345
$
1,712
Services and software
185
145
379
296
Total Net sales
1,377
956
2,724
2,008
Cost of sales:
Tangible products
618
451
1,209
937
Services and software
101
86
202
179
Total Cost of sales
719
537
1,411
1,116
Gross profit
658
419
1,313
892
Operating expenses:
Selling and marketing
148
109
282
231
Research and development
141
98
281
203
General and administrative
92
74
174
148
Amortization of intangible assets
26
16
52
32
Acquisition and integration costs
4
1
5
2
Exit and restructuring costs
—
2
—
6
Total Operating expenses
411
300
794
622
Operating income
247
119
519
270
Other expenses:
Foreign exchange (loss) gain
(1
)
(9
)
1
(12
)
Interest expense, net
(7
)
(14
)
(5
)
(59
)
Other (expense) income, net
(1
)
7
(1
)
7
Total Other expenses, net
(9
)
(16
)
(5
)
(64
)
Income before income tax
238
103
514
206
Income tax expense
19
3
67
17
Net income
$
219
$
100
$
447
$
189
Basic earnings per share
$
4.10
$
1.87
$
8.36
$
3.53
Diluted earnings per share
$
4.07
$
1.85
$
8.29
$
3.49
ZEBRA TECHNOLOGIES CORPORATION
AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF
CASH FLOWS
(In millions)
(Unaudited)
Six Months Ended
July 3, 2021
June 27, 2020
Cash flows from operating activities:
Net income
$
447
$
189
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation and amortization
88
68
Share-based compensation
38
20
Deferred income taxes
(5
)
6
Unrealized (gain) loss on forward interest
rate swaps
(13
)
37
Other, net
1
(5
)
Changes in operating assets and
liabilities:
Accounts receivable, net
(59
)
201
Inventories, net
26
(36
)
Other assets
(22
)
4
Accounts payable
(10
)
(46
)
Accrued liabilities
2
(76
)
Deferred revenue
67
45
Income taxes
(23
)
(48
)
Other operating activities
2
(4
)
Net cash provided by operating
activities
539
355
Cash flows from investing activities:
Purchases of property, plant and
equipment
(25
)
(33
)
Acquisition of businesses, net of cash
acquired
(17
)
—
Purchases of long-term investments
(17
)
(32
)
Net cash used in investing activities
(59
)
(65
)
Cash flows from financing activities:
Payments of long-term debt
(264
)
(84
)
Proceeds from issuance of long-term
debt
8
24
Payments for repurchases of common
stock
(25
)
(200
)
Net payments related to share-based
compensation plans
(46
)
(31
)
Change in unremitted cash collections from
servicing factored receivables
(2
)
55
Other financing activities
—
3
Net cash used in financing activities
(329
)
(233
)
Effect of exchange rate changes on cash
and cash equivalents, including restricted cash
(4
)
(1
)
Net increase in cash and cash equivalents,
including restricted cash
147
56
Cash and cash equivalents, including
restricted cash, at beginning of period
192
30
Cash and cash equivalents, including
restricted cash, at end of period
$
339
$
86
Less restricted cash, included in Prepaid
expenses and other current assets
(21
)
(23
)
Cash and cash equivalents at end of
period
$
318
$
63
Supplemental disclosures of cash flow
information:
Income taxes paid
$
94
$
61
Interest paid
$
17
$
19
ZEBRA TECHNOLOGIES CORPORATION
AND SUBSIDIARIES
RECONCILIATION OF ORGANIC NET
SALES GROWTH
(Unaudited)
Three Months Ended
July 3, 2021
AIT
EVM
Consolidated
Reported GAAP Consolidated Net sales
growth
54.2
%
40.4
%
44.0
%
Adjustments:
Impact of foreign currency translation
(1)
(3.0)
%
(2.7)
%
(2.6)
%
Impact of acquisitions (2)
—
%
(2.6)
%
(1.6)
%
Consolidated Organic Net sales growth
51.2
%
35.1
%
39.8
%
Six Months Ended
July 3, 2021
AIT
EVM
Consolidated
Reported GAAP Consolidated Net sales
growth
36.5
%
35.7
%
35.7
%
Adjustments:
Impact of foreign currency translation
(1)
(2.1)
%
(2.2)
%
(2.2)
%
Impact of acquisitions (2)
—
%
(2.6)
%
(1.5)
%
Consolidated Organic Net sales growth
34.4
%
30.9
%
32.0
%
(1)
Operating results reported in
U.S. Dollars are affected by foreign currency exchange rate
fluctuations. Foreign currency translation impact represents the
difference in results that are attributable to fluctuations in the
currency exchange rates used to convert the results for businesses
where the functional currency is not the U.S. Dollar. This impact
is calculated by translating the current period results at the
currency exchange rates used in the comparable prior year period,
inclusive of the Company’s foreign currency hedging program.
(2)
For purposes of computing Organic
Net sales growth, amounts directly attributable to the acquisitions
of Reflexis and Adaptive Vision are excluded for twelve months
following their respective acquisitions.
ZEBRA TECHNOLOGIES CORPORATION
AND SUBSIDIARIES
RECONCILIATION OF GAAP TO
NON-GAAP GROSS MARGIN
(In millions)
(Unaudited)
Three Months Ended
July 3, 2021
June 27, 2020
AIT
EVM
Consolidated
AIT
EVM
Consolidated
GAAP
Reported Net sales (1)
$
421
$
959
$
1,377
$
273
$
683
$
956
Reported Gross profit (1)
201
460
658
125
296
419
Gross Margin
47.7
%
48.0
%
47.8
%
45.8
%
43.3
%
43.8
%
Non-GAAP
Adjusted Net sales
$
421
$
959
$
1,380
$
273
$
683
$
956
Adjusted Gross profit (2)
202
461
663
126
296
422
Adjusted Gross Margin
48.0
%
48.1
%
48.0
%
46.2
%
43.3
%
44.1
%
Six Months Ended
July 3, 2021
June 27, 2020
AIT
EVM
Consolidated
AIT
EVM
Consolidated
GAAP
Reported Net sales (1)
$
857
$
1,873
$
2,724
$
628
$
1,380
$
2,008
Reported Gross profit (1)
411
908
1,313
296
599
892
Gross Margin
48.0
%
48.5
%
48.2
%
47.1
%
43.4
%
44.4
%
Non-GAAP
Adjusted Net sales
$
857
$
1,873
$
2,730
$
628
$
1,380
$
2,008
Adjusted Gross profit (2)
412
911
1,323
297
600
897
Adjusted Gross Margin
48.1
%
48.6
%
48.5
%
47.3
%
43.5
%
44.7
%
(1)
Consolidated results include
corporate eliminations related to business acquisition purchase
accounting adjustments that are not reported in segment
results.
(2)
Adjusted Gross profit excludes
business acquisition purchase accounting adjustments, share-based
compensation expense, and product sourcing diversification
costs.
ZEBRA TECHNOLOGIES CORPORATION
AND SUBSIDIARIES
RECONCILIATION OF GAAP TO
NON-GAAP NET INCOME
(In millions, except share
data)
(Unaudited)
Three Months Ended
Six Months Ended
July 3, 2021
June 27, 2020
July 3, 2021
June 27, 2020
Net income
$
219
$
100
$
447
$
189
Adjustments to Net sales(1)
Purchase accounting adjustments
3
—
6
—
Total adjustments to Net sales
3
—
6
—
Adjustments to Cost of sales(1)
Share-based compensation
2
1
4
2
Product sourcing diversification
initiative
—
2
—
3
Total adjustments to Cost of
sales
2
3
4
5
Adjustments to Operating expenses(1)
Amortization of intangible assets
26
16
52
32
Acquisition and integration costs
4
1
5
2
Share-based compensation
25
16
44
21
Exit and restructuring costs
—
2
—
6
Product sourcing diversification
initiative
—
1
—
5
Total adjustments to Operating
expenses
55
36
101
66
Adjustments to Other income (expense),
net(1)
Amortization of debt issuance costs and
discounts
1
—
2
1
Investment gain
1
(7
)
—
(7
)
Foreign exchange (gain) loss
1
9
(1
)
12
Forward interest rate swap (gain) loss
3
7
(5
)
42
Total adjustments to Other income
(expense), net
6
9
(4
)
48
Income tax effect of adjustments(2)
Reported income tax expense
19
3
67
17
Less: Adjusted income tax expense
(57
)
(21
)
(116
)
(50
)
Total adjustments to income tax
(38
)
(18
)
(49
)
(33
)
Total adjustments
28
30
58
86
Non-GAAP Net income
$
247
$
130
$
505
$
275
GAAP earnings per share
Basic
$
4.10
$
1.87
$
8.36
$
3.53
Diluted
$
4.07
$
1.85
$
8.29
$
3.49
Non-GAAP earnings per share
Basic
$
4.61
$
2.44
$
9.44
$
5.13
Diluted
$
4.57
$
2.41
$
9.36
$
5.08
Basic weighted average shares
outstanding
53,449,143
53,188,486
53,460,495
53,533,116
Diluted weighted average and equivalent
shares outstanding
53,908,295
53,675,730
53,930,103
54,055,324
(1)
Presented on a pre-tax basis.
(2)
Represents adjustments to GAAP income tax
expense commensurate with pre-tax non-GAAP adjustments (including
the resulting impacts to U.S. BEAT/GILTI provisions), as well as
adjustments to exclude the impacts of certain discrete income tax
items and incorporate the anticipated annualized effects of current
year tax planning.
ZEBRA TECHNOLOGIES CORPORATION
AND SUBSIDIARIES
GAAP to NON-GAAP
RECONCILIATION TO EBITDA
(In millions)
(Unaudited)
Three Months Ended
Six Months Ended
July 3, 2021
June 27, 2020
July 3, 2021
June 27, 2020
Net income
$
219
$
100
$
447
$
189
Add back:
Depreciation (excluding exit and
restructuring costs)
18
17
36
35
Amortization of intangible assets
26
16
52
32
Total Other expenses, net
9
16
5
64
Income tax expense
19
3
67
17
EBITDA (Non-GAAP)
291
152
607
337
Adjustments to Net sales
Purchase accounting adjustments
3
—
6
—
Total adjustments to Net sales
3
—
6
—
Adjustments to Cost of sales
Share-based compensation
2
1
4
2
Product sourcing diversification
initiative
—
2
—
3
Total adjustments to Cost of sales
2
3
4
5
Adjustments to Operating expenses
Acquisition and integration costs
4
1
5
2
Share-based compensation
25
16
44
21
Exit and restructuring costs
—
2
—
6
Product sourcing diversification
initiative
—
1
—
5
Total adjustments to Operating
expenses
29
20
49
34
Total adjustments to EBITDA
34
23
59
39
Adjusted EBITDA (Non-GAAP)
$
325
$
175
$
666
$
376
Adjusted EBITDA % of Adjusted Net
Sales
23.6
%
18.3
%
24.4
%
18.7
%
FREE
CASH FLOW
Six Months Ended
July 3, 2021
June 27, 2020
Net cash provided by operating
activities
$
539
$
355
Less: Purchases of property, plant and
equipment
(25
)
(33
)
Free cash flow (Non-GAAP)(1)
$
514
$
322
(1)
Free cash flow is defined as Net
cash provided by operating activities in a period minus purchases
of property, plant and equipment (capital expenditures) made in
that period. This measure does not represent residual cash flows
available for discretionary expenditures as the measure does not
deduct the payments required for debt service and other contractual
obligations or payments for future business acquisitions.
Therefore, we believe it is important to view free cash flow as a
measure that provides supplemental information to our entire
statements of cash flows.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20210803005165/en/
Investors Michael Steele, CFA, IRC
Vice President, Investor Relations Phone: + 1 847 793 6707
msteele@zebra.com
Media Therese Van Ryne Director,
Global Public Relations Phone: + 1 847 370 2317
therese.vanryne@zebra.com
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