Zebra Technologies Net Loss Widens; Warns On Q2 Sales; Cuts FY16 Sales View

(RTTNews) - Zebra Technologies Corp. (ZBRA) reported Tuesday that its first-quarter net loss was $29 million or $0.56 per share, wider than prior year's loss of $25 million or $0.50 per share.

Adjusted net income was $53 million or $1.01 per share, compared to last year's $72 million or $1.41 per share.

On average, nine analysts polled by Thomson Reuters expected earnings of $1.22 per share for the quarter. Analysts' estimates typically exclude special items.

Net sales declined 5.2 percent to $847 million from $893 million a year ago. Adjusted net sales dropped 5.5 percent to $850 million.

Analysts expected revenues of $878.67 million.

Gross profit dropped 4.6 percent, while gross margin improved 0.2 percentage points to 46 percent.

The company said its first quarter results were below expectations, with lower sales and earnings reflecting the continuation of a cautious enterprise spending environment against a tough comparison to double-digit growth last year.

Looking ahead, for the second quarter, the company expects adjusted earnings in the range of $1.00 to $1.20 per share and adjusted net sales to decline approximately 3 percent to 0 percent from the comparable net sales of $894 million last year.

Adjusted EBITDA margin is expected to be in the range of 15 percent to 16 percent for the second quarter 2016. Analysts expect earnings of $1.30 per share on sales of $906.40 million for the quarter.

Further, the company expects full year 2016 net sales, excluding purchase accounting adjustments, to change approximately down 3 percent to up 1 percent. Adjusted EBITDA margin is expected to be approximately 17 percent.

Previously, the company was projecting full year 2016 net sales to grow approximately 1 percent to 4 percentand adjusted EBITDA margin to be in the range of 17 percent to 18 percent.

Anders Gustafsson, CEO osaid, "Given our first quarter results, continued macro uncertainty, and cautious spending behavior from many of our North America, EMEA, and Latin American customers, we are introducing a tempered outlook for the second quarter and have reduced our full-year sales outlook."