tapebrief
ZBRA · Q3 2026
Preliminary brief— based on press release only. Full analysis including management tone and Q&A will be added when the transcript is available.

ZBRA · Q4 2025 Earnings

Zebra Technologies

Reported February 12, 2026

30-second summary

Q4 revenue grew 10.6% YoY to $1.48B with adjusted EBITDA margin of 22.1% and non-GAAP EPS of $4.33 — all above the Q3-set guide. But organic net sales growth was only 2.5%, meaning ~810bps of the print came from ELO/FX; FY2026 is guided to 9–13% revenue growth with a ~22% EBITDA margin, while management flags an "approximately two-point" memory component headwind starting Q2 2026 that it claims to fully mitigate inside the year.

Headline numbers

EPS

Q4 FY2025

$4.33

Revenue

Q4 FY2025

$1.48B

+10.6% YoY

Gross margin

Q4 FY2025

47.3%

Operating margin

Q4 FY2025

9.4%

Key financials

Q4 FY2025
MetricQ4 FY2025YoYQ3 FY2026QoQ
Revenue$1.48B+10.6%$1.32B+11.7%
EPS$4.33—$3.88+11.6%
Gross margin47.3%—48.0%-70bps
Operating margin9.4%—13.9%-450bps

Guidance

Q4 FY2025 results beat modest guidance; FY2026 outlook reflects mid-single-digit revenue growth acceleration with stable margins and improved FCF.

Guidance is issued for both next quarter and the full year. Both may appear below.

Actuals vs prior guidance

MetricPeriodPrior guideActualΔResult
EPS (non-GAAP)Q4 FY2025$4.20 to $4.40$4.33in-line (within range)Beat
Revenue growth (YoY)Q4 FY20258% to 11%10.6%+0–2.6pts above guideBeat
Adjusted EBITDA MarginQ4 FY2025approximately 22%22.1%+0.1pts above guideBeat
Free Cash FlowFY2025greater than $800 million$831 million+$31M above guideBeat

New guidance

MetricPeriodGuideYoY
EPS (non-GAAP)FY2025FY2026: $17.70 to $18.30 (midpoint $18.00)—
Revenue growth (YoY)FY20269% to 13%—
Adjusted EBITDA MarginFY2026approximately 22%—
Free Cash FlowFY2026at least $900 million—
EPS (non-GAAP)Q1 FY2026$4.05 to $4.35—
Revenue growth (YoY)Q1 FY202611% to 15%—
Adjusted EBITDA MarginQ1 FY202621% to 22%—

Product revenue

Q4 FY2025
SegmentQ4 FY2025YoY
Connected Frontline (CF)$0.854B+17.6%
Asset Visibility & Automation (AVA)$0.621B+2.1%
CF Segment Organic Growth3.6%—
AVA Segment Organic Growth1.3%—

Management tone

Customer-capex resilience (Q2) → ELO TAM expansion (Q3) → Portfolio refocus + memory headwind mitigation (Q4)

No transcript was available for this release; tone analysis draws on press-release language and prior-quarter context.

The robotics exit, surfaced this quarter, is the loudest portfolio signal in three quarters. Management framed it as "sharpened our focus on automation by exiting our robotics business to prioritize areas where we see better growth opportunities, including RFID, machine vision, and AI-powered solutions" — a deliberate concession that one of last year's growth lanes did not earn its capital. Combined with ELO going the other way (added in Q2), this is the second portfolio surgery in three quarters and signals management is actively pruning rather than nurturing the existing footprint.

Machine vision shifted from defensive to recovery language. In Q2 it was a comps-pressured headwind; in Q3 the press release was silent on it; this quarter the framing is "strong pipeline of machine vision opportunities and expect to return to growth in 2026." The AVA organic +1.3% in Q4 says recovery hasn't arrived yet — this is forward-looking language carrying real weight in the FY26 guide.

The cost-pressure narrative migrated from tariffs to memory. In Q2 tariffs were the headline drag, recalibrated down to ~$30M net for FY25 on better China rates. This quarter tariffs barely appear; the new line is "industry-wide price increases for memory components beginning in Q2" with the guide "reflects us fully mitigating this approximately two-point headwind." The repeated emphasis on "full mitigation" through the year is the tell — this is a confidence statement management chose to make rather than was forced into, which usually means it's the variable they're least sure about.

AI moved from pipeline talk to deployed product. "AI blueprints and Zebra Companion are software and service offerings with pay pilots already underway and scale deployments expected this year" reads as a firmer commitment than Q2's TAM framing of ELO. Whether this shows up in AVA organic acceleration in H1 2026 is the immediate test.

The Q1 FY26 guide reveals where management has the least conviction. Q1 EBITDA margin at 21–22% sits at the low end of the FY ~22% target, and the EPS midpoint of $4.20 is below the Q4 print of $4.33 — both consistent with the Q2 memory cost step-up management has flagged but not yet absorbed. The FY guide assumes the mitigation works on schedule.

Recurring themes management leaned on this quarter:

Memory component price escalation and mitigation strategiesAI-powered frontline solutions as differentiatorRFID high-growth momentum and expanded use casesAcquisition synergy realization (Elo Touch, PhotoNeo)Regional strength variance (APAC/LATAM outperforming, North America cycling tough comps)Service and software margin pressures from aging install base

Risks management surfaced:

Memory component price escalation beginning Q2 2026Potential supply constraints for higher-density memory despite mitigation effortsMacro uncertainty and timing of customer deals affecting guidance rangeService margin pressure from aging install base repair costsNorth America large order cyclicality and tough year-ago comparisons

Answers to last quarter's watch list

Q4 organic growth above the implied floor (-0.5% to +2.5%). Organic net sales growth came in at 2.5% — right at the top of the implied range, not above it. Core demand is decelerating beneath the ELO halo as anticipated; ELO contribution accounts for ~810bps of the 10.6% reported.
Resolved negatively
ELO contribution disclosure and synergy update. First full quarter of ELO is visible in the CF reported-vs-organic gap (+17.6% reported vs +3.6% organic). Management cites Elo as a "momentum" driver into 2026 but did not refresh the $25M year-three EBITDA synergy target on the print.
Continue monitoring
FY2026 framing — organic re-acceleration vs ELO carryover. The 9–13% FY2026 revenue guide is heavily ELO-aided: the FY25 organic baseline is roughly 2–3%, and the guide implies organic in the mid-single digits at the midpoint after ELO laps. Management is leaning on ELO carryover with a modest organic step-up assumption, not betting on a clean re-acceleration. Status: Resolved (with caveat — guide credible but organic recovery still hypothetical).
Adj. EBITDA margin at/above ~22% in Q4. Hit 22.1% — fractionally above the guide. But FY2026 is guided flat at ~22% with no upward framing, and Q1 FY26 is guided at 21–22%, meaning the prior margin ceiling is now the new floor rather than a launching pad. Status: Resolved (margin held, but no expansion signal).
Pace of the $500M repurchase. Q4 repurchases of $303M are explicitly front-loaded — ~60% of the 12-month commitment executed in the first quarter.
Resolved positively
CF/AVA segment-reporting transition vs EVM/AIT history. The new CF and AVA segments are reported this quarter ($854M and $621M); the recast appendix series referenced last quarter (CF Q3'25 $705M, AVA Q3'25 $615M) implies CF +21% / AVA +1% sequential reported and CF organic deceleration once ELO is stripped. The bridge is mechanically usable but the organic story underneath is messier than the reported series. Status: Resolved (bridge intact; underlying organic series noisier).

What to watch into next quarter

Q1 FY2026 organic growth — with reported guided to +11–15%, the ELO contribution alone explains most of the headline; organic in the low-to-mid single digits would confirm the recovery thesis, anything sub-2% would indicate the FY2026 organic acceleration is at risk before the memory cost layer hits in Q2.

Q2 FY2026 memory cost step-up — management has committed to full mitigation within the year. Watch Q1 commentary for early evidence of pricing actions taking effect and any quantification of the ~2pt gross margin headwind beyond press-release framing.

Machine vision Q1 print specifically — return to growth was promised for 2026; AVA organic at +1.3% in Q4 means the inflection has to show up early or the FY guide loses a leg.

ELO synergy progress against the $25M year-three EBITDA target — first cross-quarter visibility on integration; explicit dollar disclosure would build credibility for the flat ~22% FY26 margin guide.

Robotics exit cost and timing disclosure — whether there are restructuring charges, asset write-downs, or revenue runoff to model into Q1/Q2.

Repurchase pace post-front-load — whether management extends the program or pauses, signaling capital-allocation posture into a year with ELO debt to digest and an ≥$900M FCF guide to fund it.

Sources

  1. Zebra Technologies Q4 2025 press release (SEC EDGAR): https://www.sec.gov/Archives/edgar/data/877212/000087721226000003/zbraex991123125.htm
  2. Tapebrief Q3 2025 ZBRA brief (prior guide and watch list baseline).
  3. Tapebrief Q2 2025 ZBRA brief (tariff and ELO framing baseline).

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