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August 16, 2025 • 3 min read
In the complex world of modern supply chains, retail, and healthcare, tracking assets efficiently is crucial. This is the arena where Zebra Technologies (ZBRA) operates, providing essential hardware and software—from barcode scanners and RFID readers to mobile computers—that power global logistics. Let's delve into their latest quarterly report for the period ending June 28, 2025, to analyze their financial health and recent performance.
Zebra reported a notable increase in sales for the second quarter. Total net sales climbed 6.2% year-over-year to $1.29 billion, up from $1.22 billion in the same period last year. The growth was even more robust for the first six months of 2025, rising 8.7%.
This growth was broad-based across the company’s two main divisions:
Geographically, North America remains a stronghold, with sales increasing by 8.0%. The Asia-Pacific region also demonstrated significant momentum with a 19.5% jump in sales, signaling strong demand in those markets.
While sales grew, the path from revenue to profit reveals a more nuanced story. The following flow diagram breaks down the company's income statement for the quarter, illustrating how revenue is allocated to various costs and expenses, ultimately leading to net income.
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Gross profit rose to $616 million, but the company's gross margin—the percentage of revenue left after accounting for the cost of goods sold—dipped slightly from 48.4% to 47.6%. The filing notes that the EVM segment, in particular, faced headwinds from tariffs and less favorable margins on services and software.
Despite this, Zebra managed its operating costs effectively. Total operating expenses as a percentage of sales decreased, helping to lift operating income by a healthy 9.6% to $183 million. However, net income for the quarter was essentially flat at $112 million, compared to $113 million a year ago. This was primarily due to an $11 million foreign exchange loss and higher interest expenses, which rose to $25 million from $23 million in the prior year's quarter.
A key highlight from the report is Zebra's commitment to returning capital to its shareholders. The company repurchased $125 million of its own stock during the second quarter, bringing the year-to-date total to $250 million.
This buyback program had a direct and positive impact on earnings per share (EPS). By reducing the number of outstanding shares, Zebra was able to increase its diluted EPS to $2.19, up from $2.17 in the prior year, even though its net income didn't grow. This is a clear indicator of management's focus on enhancing shareholder value.
In conclusion, Zebra Technologies is navigating a complex environment with success. The company is delivering strong revenue growth, driven by solid demand for its asset tracking and mobility solutions. While facing margin pressures from tariffs and foreign exchange fluctuations—common risks for a global hardware company—it is managing operating costs well. The aggressive share repurchase program underscores a confident outlook and a commitment to its investors. With recent acquisitions in machine vision and a pending deal for interactive displays, Zebra is also actively positioning itself for future growth in adjacent markets.
Last updated: August 16, 2025