Zebra Technologies (NASDAQ:ZBRA) posted record second-quarter performance driven by broad-based growth across its business and increased its full-year guidance as demand for automation and AI solutions remained strong.
Key Investor Takeaways
- Zebra Technologies (NASDAQ:ZBRA) delivered record second-quarter results, with revenue rising 20.4% year over year to $1.56 billion.
- Both business segments posted growth, reflecting broad customer demand for connected frontline and automation solutions.
- Profitability improved significantly, with adjusted EBITDA margin expanding to 27.7% and non-GAAP EPS climbing to $6.35.
- Management raised its full-year 2026 outlook, pointing to continued sales growth, higher earnings, and more than $1 billion in expected free cash flow.
- Strong cash generation supported continued capital returns, with $568 million of share repurchases completed during the first half of 2026.
Why (NASDAQ:ZBRA) Stock Is in Focus
Zebra Technologies (NASDAQ:ZBRA) reported record financial results for the second quarter of 2026, highlighting continued demand for its enterprise automation and digital workflow solutions.
Revenue increased 20.4% year over year to $1.557 billion, while net income more than doubled to $233 million. Diluted earnings per share reached $4.85, and non-GAAP diluted EPS rose 75.9% to $6.35.
Growth was broad-based across both operating segments. Connected Frontline revenue increased to $903 million from $717 million a year earlier, while Asset Visibility & Automation revenue climbed to $654 million from $576 million. Organic revenue grew 9.2%, including 7.5% growth in Connected Frontline and 11.4% growth in Asset Visibility & Automation.
Margins also strengthened during the quarter. Gross margin expanded to 53.0% from 47.6%, while adjusted EBITDA increased 61.4% to $431 million, representing a 27.7% margin. The company said results benefited in part from IEEPA tariff recoveries and favorable foreign exchange movements.
Zebra also continued returning capital to shareholders, repurchasing $268 million of stock during the quarter and $568 million during the first six months of 2026.
Why This Matters for Investors
The combination of double-digit revenue growth, expanding margins, and a higher full-year outlook suggests Zebra continues to benefit from customer investment in automation, asset tracking, and AI-enabled operational technologies.
Management’s decision to raise guidance may reinforce confidence that current demand trends are extending beyond a single quarter. Continued strength across both major operating segments also suggests growth is being supported by multiple end markets rather than a single business line.
The company’s cash generation provides additional flexibility to fund acquisitions, invest in product development, and continue share repurchases. At the same time, investors may continue monitoring whether margin performance remains at current levels as tariff recoveries and currency benefits evolve.
What to Watch Next
Investors will be watching Zebra’s third-quarter execution against its updated outlook, which calls for revenue growth of 17% to 20%, adjusted EBITDA margin of approximately 22%, and non-GAAP EPS between $4.70 and $4.90.
For the full year, management expects revenue growth of 14% to 16%, adjusted EBITDA margin between 23.5% and 24.0%, non-GAAP EPS of $20.75 to $21.25, and free cash flow exceeding $1 billion. Investors will also monitor demand trends for enterprise automation and AI solutions, as well as the contribution from acquisitions and ongoing capital allocation through share repurchases.
Zebra Technologies Corporation stock price
