Zebra Technologies (NASDAQ: ZBRA) lifts profit on tariff refund, growth

Rhea-AI Filing Summary

Zebra Technologies delivered strong Q2 2026 results, with net sales of $1,557 million, up 20.4% year over year, and Consolidated Organic Net sales growth of 9.2%. Both Connected Frontline and Asset Visibility & Automation segments posted double-digit sales growth across all regions.

Gross margin expanded to 53.0% from 47.6%, aided by a $73 million benefit from expected refunds of previously paid IEEPA import tariffs and favorable foreign currency. Operating income rose to $321 million and net income to $233 million, driving diluted EPS to $4.85 from $2.19.

Operating cash flow reached $387 million in the first half, supporting Free cash flow of $361 million. Zebra repurchased $568 million of shares year to date while total debt increased to $2,776 million, with $2,275 million classified as current ahead of 2027 maturities the company plans to refinance.

The 2025 Productivity Plan is substantially complete, with cumulative one-time charges of $37 million expected to yield about $35 million in annualized pre-tax cost savings, enhancing future profitability.

Positive

• Net sales rose 20.4% to $1,557 million, with gross margin expanding to 53.0% and operating income up 75.4% year over year.
• First-half Free cash flow reached $361 million, up from $288 million, supporting substantial share repurchases of $568 million while cash and cash equivalents increased to $157 million.

Negative

• Total debt increased to $2,776 million, with the current portion jumping to $2,275 million, heightening reliance on successfully refinancing major 2027 Credit Facility maturities.
• Q2 gross margin benefited from a one-time $73 million IEEPA tariff refund, so part of the profitability improvement reflects non-recurring items rather than ongoing operations.

Filing Explained

The tariff benefit is partly a receivable: $14 million had been collected by July 4, with another $27 million received by July 31.

The filing reports Zebra’s unaudited quarter ended July 4, 2026 and leaves $2,275 million of debt classified as current while refinancing remains an intention, not a completed transaction.

Zebra recognized a $73 million pretax benefit for expected tariff refunds, but by July 4, 2026 only $14 million had been received in cash and $59 million was recorded as receivable; another $27 million was received through July 31, 2026.

The 2026 long-term incentive plan had 1,809,099 shares available to be issued from treasury shares, which is future award capacity rather than a disclosed issuance in this filing.

After $10 million of letters of credit, the revolving facility had $925 million available, while the receivables financing facility allowed borrowings of up to $180 million and had $180 million outstanding.

The named resolution points are the Customs and Border Protection refund process and any refinancing of the Credit Facility during the second half of 2026, whose timing, structure, and terms remain subject to market conditions.

Key Figures

Net sales Q2 2026: $1,557 million Gross margin Q2 2026: 53.0% Net income Q2 2026: $233 million +5 more

8 metrics

Net sales Q2 2026 $1,557 million Three months ended July 4, 2026; up 20.4% year over year

Gross margin Q2 2026 53.0% Quarter ended July 4, 2026; was 47.6% in Q2 2025

Net income Q2 2026 $233 million Three months ended July 4, 2026; compared with $112 million a year earlier

Diluted EPS Q2 2026 $4.85 Quarter ended July 4, 2026; up from $2.19 in Q2 2025

Free cash flow 1H 2026 $361 million Six months ended July 4, 2026; defined as operating cash flow minus capex

Total debt July 4, 2026 $2,776 million Includes Term Loan A, Senior Notes, Revolving Credit Facility, Receivables Financing Facility

IEEPA tariff refund benefit $73 million Pretax benefit recognized in Q2 2026 within Cost of Sales

Share repurchases 1H 2026 $568 million 2,468,021 shares of common stock repurchased in the first six months of 2026

Key Terms

Consolidated Organic Net sales growth, Receivables Financing Facility, cash flow hedges, Accumulated other comprehensive income (loss), +1 more

5 terms

Consolidated Organic Net sales growth financial

"Consolidated Organic Net sales growth is a non-GAAP financial measure."

Receivables Financing Facility financial

"Receivables Financing Facility with a borrowing limit of up to $180 million."

A receivables financing facility is a line of credit or loan that lets a company borrow money using its unpaid customer invoices as collateral, effectively turning future payments into cash now. For investors, it matters because it improves short-term cash flow and can reduce the need to sell equity, but it also adds financing costs and exposes the company to risk if customers don’t pay — like using IOUs to secure a short-term loan.

cash flow hedges financial

"These hedges are designated as cash flow hedges, and the Company defers recognition."

A cash flow hedge is an accounting label companies use when they enter financial contracts—like currency or interest-rate agreements—to protect expected future cash payments or receipts from unpredictable moves. For investors, it signals that the company is trying to smooth out future cash variability (think of locking in a price to avoid surprises), which can reduce reported profit swings but also means the company has exposure to derivative instruments and their associated risks.

Accumulated other comprehensive income (loss) financial

"Unrealized gain (loss) on sales hedging is recorded in Accumulated other comprehensive income (loss)."

A balance-sheet line that tracks certain gains and losses that haven’t flowed through the company’s profit-and-loss statement, such as unrealized changes in the value of investments, foreign-currency adjustments, and some pension-related items. Think of it like a storage closet for value swings the company hasn’t ‘realized’ by selling or settling them yet; it changes shareholders’ equity and helps investors see hidden volatility or potential future impacts on book value.

International Emergency Economic Powers Act (IEEPA) regulatory

"The U.S. Supreme Court invalidated import tariffs enacted under the International Emergency Economic Powers Act (IEEPA)."

A U.S. law that lets the president impose wide economic controls—like trade bans, asset freezes, and export limits—when a national emergency is declared. For investors it matters because these powers can suddenly change which countries, companies, or products can be traded or owned, similar to a circuit breaker that can shut off parts of a market and alter company revenues, supply chains, or the value of holdings overnight.

AI-generated analysis. How Rhea-AI works. Not financial advice.

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FAQ

What were Zebra Technologies (ZBRA) Q2 2026 revenues and growth?

Zebra Technologies (ZBRA) reported Q2 2026 net sales of $1,557 million, a 20.4% increase from the prior-year quarter. Consolidated Organic Net sales growth, excluding foreign currency, acquisitions and dispositions, was 9.2%, reflecting stronger demand across all regions and both operating segments.

How profitable was Zebra Technologies (ZBRA) in Q2 2026?

Zebra generated Q2 2026 net income of $233 million, up from $112 million a year earlier. Diluted earnings per share were $4.85, more than double the prior-year $2.19, supported by higher sales, expanded gross margin and operating leverage.

How did the IEEPA tariff refund impact ZBRA’s Q2 2026 results?

Zebra recognized a pretax benefit of approximately $73 million from expected refunds of previously paid IEEPA import tariffs. The benefit was recorded in Cost of Sales, lifting gross margin, with $46 million attributed to the CF segment and $27 million to AVA.

How did Zebra’s (ZBRA) CF and AVA segments perform in Q2 2026?

Connected Frontline net sales were $903 million, up 25.9%, with operating income of $219 million. Asset Visibility & Automation net sales reached $654 million, up 13.5%, and operating income was $192 million, with gross margin improving to 56.3%.

What is Zebra Technologies’ (ZBRA) debt position and refinancing plan?

Total debt was $2,776 million at July 4, 2026, including $2,275 million classified as current, largely Term Loan A and Revolving Credit Facility maturing in 2027. Zebra states it intends to refinance this Credit Facility in the second half of 2026.

How much free cash flow and share repurchases did ZBRA report for 1H 2026?

For the first half of 2026, Zebra generated Free cash flow of $361 million, up from $288 million a year earlier. The company repurchased 2,468,021 shares of common stock for $568 million, including $268 million in Q2 alone.

What cost savings are expected from Zebra’s 2025 Productivity Plan?

Cumulative one-time charges under the 2025 Productivity Plan total $37 million, primarily severance and related costs. Zebra expects these actions to deliver approximately $35 million in net annualized pre-tax cost savings, with most remaining obligations to be settled in the second half of 2026.

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Table of Contents

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended July 4, 2026

OR

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from                                          to                                         

Commission File Number: 000-19406

Zebra Technologies Corporation

(Exact name of registrant as specified in its charter)

Delaware			36-2675536
(State or other jurisdiction of incorporation or organization)			(I.R.S. Employer Identification No.)

3 Overlook Point, Lincolnshire, IL 60069

(Address of principal executive offices) (Zip Code)

Registrant’s telephone number, including area code: (847) 634-6700

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol(s)

Name of exchange on which registered

Class A Common Stock, par value $.01 per share

ZBRA

The NASDAQ Stock Market, LLC

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  ☒    No  ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).    Yes   ☒    No  ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer

☒

Accelerated filer

☐

Non-accelerated filer

☐

Smaller reporting company

☐

Emerging growth company

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes  ☐   No  ☒

As of July 28, 2026, there were 47,310,660 shares of Class A Common Stock, $.01 par value, outstanding.

Table of Contents

ZEBRA TECHNOLOGIES CORPORATION AND SUBSIDIARIES

QUARTER ENDED JULY 4, 2026

TABLE OF CONTENTS

						PAGE
PART I - FINANCIAL INFORMATION						3
Item 1.			Consolidated Financial Statements			3
			Consolidated Balance Sheets as of July 4, 2026 (unaudited) and December 31, 2025			3
			Consolidated Statements of Operations (unaudited) for the three and six months ended July 4, 2026 and June 28, 2025			4
			Consolidated Statements of Comprehensive Income (unaudited) for the three and six months ended July 4, 2026 and June 28, 2025			5
			Consolidated Statements of Stockholders’ Equity (unaudited) for the three and six months ended July 4, 2026 and June 28, 2025			6
			Consolidated Statements of Cash Flows (unaudited) for the six months ended July 4, 2026 and June 28, 2025			8
			Notes to Consolidated Financial Statements (unaudited)			8
			Note 1: Description of Business and Basis of Presentation			9
			Note 2: Significant Accounting Policies			9
			Note 3: Revenues			10
			Note 4: Inventories			11
			Note 5: Business Acquisitions			11
			Note 6: Investments			11
			Note 7: Exit and Restructuring Activities			11
			Note 8: Fair Value Measurements			12
			Note 9: Derivative Instruments			13
			Note 10: Long-Term Debt			15
			Note 11: Leases			16
			Note 12: Accrued Liabilities, Commitments and Contingencies			17
			Note 13: Share-Based Compensation			17
			Note 14: Income Taxes			18
			Note 15: Earnings Per Share			18
			Note 16: Accumulated Other Comprehensive (Loss) Income			18
			Note 17: Accounts Receivable Factoring			19
			Note 18: Segment Information & Geographic Data			19
Item 2.			Management’s Discussion and Analysis of Financial Condition and Results of Operations			21
			Overview			21
			Results of Operations			22
			Results of Operations by Segment			24
			Liquidity and Capital Resources			27
			Safe Harbor			28
			New Accounting Pronouncements			29
			Non-GAAP Measures			29
Item 3.			Quantitative and Qualitative Disclosures About Market Risk			29
Item 4.			Controls and Procedures			29
PART II - OTHER INFORMATION						31
Item 1.			Legal Proceedings			31
Item 1A.			Risk Factors			31
Item 2.			Unregistered Sales of Equity Securities and Use of Proceeds			31
Item 5.			Other Information			31
Item 6.			Exhibits			32
Signatures						33

2

Table of Contents

PART I - FINANCIAL INFORMATION

Item 1. Consolidated Financial Statements

ZEBRA TECHNOLOGIES CORPORATION AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(In millions, except share data)

			July 4, 2026						December 31, 2025
			(Unaudited)
Assets
Current assets:
Cash and cash equivalents			$	157					$	125
Accounts receivable, net of allowances for doubtful accounts of $1 million each as of July 4, 2026 and December 31, 2025			990						801
Inventories, net			733						729
Income tax receivable			56						31
Prepaid expenses and other current assets			126						110
Total Current assets			2,062						1,796
Property, plant and equipment, net			346						353
Right-of-use lease assets			168						166
Goodwill			4,701						4,727
Other intangibles, net			725						809
Deferred income taxes			396						414
Other long-term assets			239						237
Total Assets			$	8,637					$	8,502
Liabilities and Stockholders’ Equity
Current liabilities:
Current portion of long-term debt			$	2,275					$	141
Accounts payable			738						695
Accrued liabilities			506						558
Deferred revenue			444						446
Income taxes payable			35						12
Total Current liabilities			3,998						1,852
Long-term debt			493						2,361
Long-term lease liabilities			156						157
Deferred income taxes			31						32
Long-term deferred revenue			391						396
Other long-term liabilities			133						116
Total Liabilities			5,202						4,914
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			882						814
Treasury stock at cost, 24,762,921 and 22,558,911 shares as of July 4, 2026 and December 31, 2025, respectively			(3,057)						(2,488)
Retained earnings			5,647						5,279
Accumulated other comprehensive loss			(38)						(18)
Total Stockholders’ Equity			3,435						3,588
Total Liabilities and Stockholders’ Equity			$	8,637					$	8,502

See accompanying Notes to Consolidated Financial Statements.

3

Table of Contents

ZEBRA TECHNOLOGIES CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

(In millions, except share data)

(Unaudited)

			Three Months Ended												Six Months Ended
			July 4, 2026						June 28, 2025						July 4, 2026						June 28, 2025
Net sales:
Tangible products			$	1,316					$	1,055					$	2,547					$	2,117
Services and software			241						238						505						484
Total Net sales			1,557						1,293						3,052						2,601
Cost of sales:
Tangible products			615						553						1,238						1,095
Services and software			117						124						247						245
Total Cost of sales			732						677						1,485						1,340
Gross profit			825						616						1,567						1,261
Operating expenses:
Selling and marketing			184						158						373						319
Research and development			159						144						324						295
General and administrative			114						102						241						213
Amortization of intangible assets			37						25						74						49
Acquisition and integration costs			2						4						3						7
Exit and restructuring costs			8						—						16						—
Total Operating expenses			504						433						1,031						883
Operating income			321						183						536						378
Other (loss) income, net:
Foreign exchange loss			(2)						(11)						(2)						(16)
Interest expense, net			(35)						(25)						(72)						(48)
Other income (expense), net			1						(9)						(10)						(11)
Total Other expense, net			(36)						(45)						(84)						(75)
Income before income tax			285						138						452						303
Income tax expense			52						26						84						55
Net income			$	233					$	112					$	368					$	248
Basic earnings per share			$	4.89					$	2.20					$	7.61					$	4.85
Diluted earnings per share			$	4.85					$	2.19					$	7.54					$	4.81

See accompanying Notes to Consolidated Financial Statements.

4

Table of Contents

ZEBRA TECHNOLOGIES CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(In millions)

(Unaudited)

			Three Months Ended												Six Months Ended
			July 4, 2026						June 28, 2025						July 4, 2026						June 28, 2025
Net income			$	233					$	112					$	368					$	248
Other comprehensive income, net of tax:
Changes in unrealized gains (losses) on sales hedging			4						(33)						17						(61)
Foreign currency translation adjustment			(18)						20						(37)						27
Comprehensive income			$	219					$	99					$	348					$	214

See accompanying Notes to Consolidated Financial Statements.

5

Table of Contents

ZEBRA TECHNOLOGIES CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(In millions, except share data)

(Unaudited)

						Class A Common Stock Shares						Class A Common Stock Value						Additional Paid-in Capital						Treasury Stock						Retained Earnings						Accumulated Other Comprehensive Loss						Total
Balance at December 31, 2025						49,592,946						$	1					$	814					$	(2,488)					$	5,279					$	(18)					$	3,588
Net share issuances and tax withholding payments related to share-based compensation plans						84,092						—						(6)						1						—						—						(5)
Share-based compensation						—						—						58						—						—						—						58
Repurchase of common stock						(1,294,028)						—						—						(300)						—						—						(300)
Net income						—						—						—						—						135						—						135
Changes in unrealized gains and losses on sales hedging (net of income taxes)						—						—						—						—						—						13						13
Foreign currency translation adjustment						—						—						—						—						—						(19)						(19)
Balance at April 4, 2026						48,383,010						$	1					$	866					$	(2,787)					$	5,414					$	(24)					$	3,470
Net share issuances and tax withholding payments related to share-based compensation plans						179,919						—						(20)						3						—						—						(17)
Share-based compensation						—						—						36						—						—						—						36
Repurchase of common stock						(1,173,993)						—						—						(268)						—						—						(268)
Excise tax on share repurchases						—						—						—						(5)						—						—						(5)
Net income						—						—						—						—						233						—						233
Changes in unrealized gains and losses on sales hedging (net of income taxes)						—						—						—						—						—						4						4
Foreign currency translation adjustment						—						—						—						—						—						(18)						(18)
Balance at July 4, 2026						47,388,936						$	1					$	882					$	(3,057)					$	5,647					$	(38)					$	3,435

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						Class A Common Stock Shares						Class A Common Stock Value						Additional Paid-in Capital						Treasury Stock						Retained Earnings						Accumulated Other Comprehensive Loss						Total
Balance at December 31, 2024						51,506,059						$	1					$	669					$	(1,900)					$	4,860					$	(44)					$	3,586
Net share issuances and tax withholding payments related to share-based compensation plans						6,550						—						(1)						—						—						—						(1)
Share-based compensation						—						—						51						—						—						—						51
Repurchase of common stock						(374,358)						—						—						(125)						—						—						(125)
Net income						—						—						—						—						136						—						136
Changes in unrealized gains and losses on sales hedging (net of income taxes)						—						—						—						—						—						(28)						(28)
Foreign currency translation adjustment						—						—						—						—						—						7						7
Balance at March 29, 2025						51,138,251						$	1					$	719					$	(2,025)					$	4,996					$	(65)					$	3,626
Net share issuances and tax withholding payments related to share-based compensation plans						172,677						—						(18)						3						—						—						(15)
Share-based compensation						—						—						32						—						—						—						32
Repurchase of common stock						(474,667)						—						—						(125)						—						—						(125)
Net income						—						—						—						—						112						—						112
Changes in unrealized gains and losses on sales hedging (net of income taxes)						—						—						—						—						—						(33)						(33)
Foreign currency translation adjustment						—						—						—						—						—						20						20
Balance at June 28, 2025						50,836,261						$	1					$	733					$	(2,147)					$	5,108					$	(78)					$	3,617

See accompanying Notes to Consolidated Financial Statements.

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ZEBRA TECHNOLOGIES CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(In millions)

(Unaudited)

			Six Months Ended
			July 4, 2026						June 28, 2025
Cash flows from operating activities:
Net income			$	368					$	248
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization			113						84
Losses on long-term investments			15						10
Share-based compensation			94						83
Deferred income taxes			9						(30)
Gain on sale of business			(5)						—
Other, net			—						2
Changes in operating assets and liabilities:
Accounts receivable, net			(193)						81
Inventories, net			(7)						11
Other assets			(10)						10
Accounts payable			35						(71)
Accrued liabilities			(35)						(101)
Deferred revenue			(8)						13
Income taxes			11						(10)
Other operating activities			—						(5)
Net cash provided by operating activities			387						325
Cash flows from investing activities:
Acquisition of business			—						(62)
Proceeds from the sale of business			9						—
Purchases of property, plant and equipment			(26)						(37)
Proceeds from sale of long-term investments			1						—
Other investing activities			1						—
Net cash used in investing activities			(15)						(99)
Cash flows from financing activities:
Payments of debt			(59)						—
Proceeds from issuance of debt			325						—
Payments for repurchases of common stock			(568)						(250)
Net payments related to share-based compensation plans			(21)						(16)
Change in unremitted cash collections from servicing factored receivables			(17)						7
Other financing activities			(1)						2
Net cash used in financing activities			(341)						(257)
Effect of exchange rate changes on cash and cash equivalents			1						2
Net increase (decrease) in cash and cash equivalents			32						(29)
Cash and cash equivalents at beginning of period			125						901
Cash and cash equivalents at end of period			$	157					$	872
Supplemental disclosures of cash flow information:
Income taxes paid			$	75					$	95
Interest paid			$	71					$	55

Certain prior period amounts included in Net cash provided by operating activities have been reclassified to conform with the current period presentation.

See accompanying Notes to Consolidated Financial Statements.

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ZEBRA TECHNOLOGIES CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Note 1 Description of Business and Basis of Presentation

Zebra Technologies Corporation and its subsidiaries (“Zebra” or the “Company”) is a global leader focused on digitizing and automating operations and improving enterprise workflows on the frontline in the automatic identification and data capture industry. We design, manufacture, and sell a broad range of offerings, including cloud-based software subscriptions, that capture and move data. We also provide a full range of services, including maintenance, technical support, repair, managed and professional services. End-users of our offerings include those in retail and e-commerce, manufacturing, transportation and logistics, healthcare, hospitality, public sector, and other industries. We provide our offerings globally through a direct sales force and an extensive network of channel partners.

In the fourth quarter of 2025, the Company’s reportable segments changed to Connected Frontline (“CF”) and Asset Visibility & Automation (“AVA”). This change aligns with how we are operating our business to advance our strategy and the level of detailed financial information reviewed by our chief operating decision-maker going forward. Historical segment results have been recast to conform with the current period presentation. These changes did not have an impact on our results of operations, cash flows, or financial condition.

Management prepared these unaudited interim consolidated financial statements according to the rules and regulations of the Securities and Exchange Commission for interim financial information and notes. As permitted under Article 10 of Regulation S-X and the instructions of Form 10-Q, these consolidated financial statements do not include all the information and notes required by United States Generally Accepted Accounting Principles (“GAAP”) for complete financial statements, although management believes that the disclosures made are adequate to make the information not misleading. These interim financial statements should be read in conjunction with the audited consolidated financial statements and notes included in the Annual Report on Form 10-K for the fiscal year ended December 31, 2025.

In the opinion of the Company, these interim financial statements include all adjustments (of a normal, recurring nature) necessary to fairly present its Consolidated Balance Sheet as of July 4, 2026, the Consolidated Statements of Operations, Comprehensive Income and Stockholders’ Equity for the three and six months ended July 4, 2026 and June 28, 2025, and the Consolidated Statements of Cash Flows for the six months ended July 4, 2026 and June 28, 2025. These results, however, are not necessarily indicative of the results expected for the full fiscal year ending December 31, 2026.

Note 2 Significant Accounting Policies

For a discussion of our significant accounting policies, see Note 2, Significant Accounting Policies within Part II, Item 8 “Financial Statements and Supplementary Data” in the Annual Report on Form 10-K for the year ended December 31, 2025. Other than our adoption of Accounting Standards Update (“ASU”) No. 2025-05 in the first quarter, there have been no changes to our significant accounting policies since our Annual Report on Form 10-K for the year ended December 31, 2025.

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Note 3 Revenues

The Company recognizes revenue to depict the transfer of goods, services, or software solutions to a customer at an amount that reflects the consideration which it expects to receive.

Revenues for tangible products are generally recognized upon shipment, whereas revenues for services are generally recognized over time by using an output or time-based method, assuming all other criteria for revenue recognition have been met. Revenues for software are recognized either upon delivery or over time using a time-based method, depending on how control is transferred to the customer. In cases where a bundle of products, services, and/or software are delivered to the customer, judgment is required to select the method of progress which best reflects the transfer of control.

Disaggregation of Revenue

The following table presents our Net sales disaggregated by product category for each of our segments (in millions):

			Three Months Ended
			July 4, 2026																		June 28, 2025
Segment			Tangible Products						Services and Software						Total						Tangible Products						Services and Software						Total
CF			$	706					$	197					$	903					$	521					$	196					$	717
AVA			610						44						654						534						42						576
Total			$	1,316					$	241					$	1,557					$	1,055					$	238					$	1,293
			Six Months Ended
			July 4, 2026																		June 28, 2025
Segment			Tangible Products						Services and Software						Total						Tangible Products						Services and Software						Total
CF			$	1,315					$	413					$	1,728					$	1,002					$	399					$	1,401
AVA			1,232						92						1,324						1,115						85						1,200
Total			$	2,547					$	505					$	3,052					$	2,117					$	484					$	2,601

In addition, refer to Note 18, Segment Information & Geographic Data for Net sales to customers by geographic region.

Performance Obligations

The Company’s remaining performance obligations relate to services and software solutions. The aggregate transaction price allocated to remaining performance obligations for arrangements with an original term exceeding one year was $1.15 billion and $1.17 billion, inclusive of deferred revenue, as of July 4, 2026 and December 31, 2025, respectively. On average, remaining performance obligations as of July 4, 2026 and December 31, 2025 are expected to be recognized over a period of approximately two years.

Contract Balances

Progress on satisfying performance obligations under contracts with customers related to billed revenues is reflected on the Consolidated Balance Sheets in Accounts receivable, net. Progress on satisfying performance obligations under contracts with customers related to unbilled revenues (“contract assets”) is reflected on the Consolidated Balance Sheets as Prepaid expenses and other current assets for revenues expected to be billed within the next twelve months, and Other long-term assets for revenues expected to be billed thereafter. The total contract asset balances were $12 million each as of July 4, 2026 and December 31, 2025. These contract assets result from timing differences between billing and satisfying performance obligations, inclusive of any impacts from the allocation of the transaction price among performance obligations for contracts that include multiple performance obligations. Contract assets are evaluated for impairment, and no impairment losses have been recognized during the six months ended July 4, 2026 and June 28, 2025, respectively.

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Deferred revenue on the Consolidated Balance Sheets consists of payments and billings in advance of our performance. The combined short-term and long-term deferred revenue balances were $835 million and $842 million as of July 4, 2026 and December 31, 2025, respectively. During the three and six months ended July 4, 2026, the Company recognized $120 million and $274 million in revenue that was previously included in the deferred revenue balance as of December 31, 2025. During the three and six months ended June 28, 2025, the Company recognized $117 million and $258 million in revenue that was previously included in the deferred revenue balance as of December 31, 2024.

Note 4 Inventories

The categories of Inventories, net are as follows (in millions): 

			July 4, 2026						December 31, 2025
Raw materials (1)			$	252					$	230
Work in process			5						7
Finished goods			476						492
Total Inventories, net			$	733					$	729

(1) Raw material inventories primarily consist of product components as well as supplies used in repair operations.

Note 5 Business Acquisitions

On September 30, 2025, the Company acquired Elo Holdings, Inc. (“Elo Touch”) for $1,303 million. The Company utilized estimated fair values as of the acquisition date to allocate the purchase consideration to the identifiable assets acquired and liabilities assumed. The purchase price allocation remains preliminary as of July 4, 2026 and subject to adjustment during the measurement period, which is up to one year from the acquisition date. No significant measurement period adjustments were recorded during the quarter ended July 4, 2026. The primary fair value estimates still considered preliminary include intangible assets and income tax-related items.

Note 6 Investments

A rollforward of the Company’s long-term investments is as follows (in millions):

			Three Months Ended												Six Months Ended
			July 4, 2026						June 28, 2025						July 4, 2026						June 28, 2025
Balance at the beginning of the period			$	96					$	110					$	103					$	110
Losses on long-term investments			—						(10)						(15)						(10)
Long-term investment acquired in exchange for sale of business			—						—						9						—
Sale of long-term investments			—						—						(1)						—
Balance at the end of the period			$	96					$	100					$	96					$	100

As further described in Note 7 Exit and Restructuring Activities, the Company acquired a long-term investment in the first quarter of 2026 as part of the consideration received for the sale of its robotics automation business.

The carrying value of the Company’s long-term investments is included in Other long-term assets on the Consolidated Balance Sheets. Net gains and losses are included within Other income (expense), net on the Consolidated Statements of Operations.

Note 7 Exit and Restructuring Activities

Robotics automation

In the first quarter of 2026, the Company completed the sale of its robotics automation business to Skild AI. The transaction resulted in a net pre-tax gain of $5 million, which was recognized in the first quarter and is included within Other income (expense), net, on the Consolidated Statements of Operations.

As part of the sale transaction, Zebra received total consideration of $20 million, consisting of $9 million in upfront cash, a minority ownership stake in Skild AI with a fair value of $9 million, and $2 million held in escrow.

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2025 Productivity Plan

In the second quarter, the Company substantially completed its organizational design changes intended to better meet its strategic objectives and improve cost efficiency (referred to as the “2025 Productivity Plan”). One-time costs associated with the 2025 Productivity Plan, which primarily consisted of employee severance and benefits, were $8 million and $16 million during the three and six months ended July 4, 2026, respectively. Cumulative one-time costs associated with the 2025 Productivity Plan, including those recognized in 2025, are $37 million.

The one-time costs associated with the 2025 Productivity Plan are classified within Exit and restructuring on the Consolidated Statements of Operations.

A rollforward of the liability associated with the Company’s Exit and restructuring activities, which are reflected within Accrued liabilities on the Consolidated Balance Sheets, is as follows (in millions):

Balance as of December 31, 2025			$	23
Exit and restructuring charges			16
Cash payments			(24)
Balance as of July 4, 2026			$	15

Note 8 Fair Value Measurements

Financial assets and liabilities are measured using inputs from three levels of the fair value hierarchy in accordance with Accounting Standards Codification (“ASC”) Topic 820, Fair Value Measurements. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. ASC Topic 820 established a fair value hierarchy that prioritizes observable and unobservable inputs used to measure fair value into the following three broad levels:

•Level 1: Quoted prices in active markets that are accessible at the measurement date for identical assets or liabilities. The fair value hierarchy gives the highest priority to Level 1 inputs (e.g. U.S. Treasuries and money market funds).

•Level 2: Observable prices that are based on inputs not quoted in active markets but corroborated by market data.

•Level 3: Unobservable inputs are used when little or no market data is available. The fair value hierarchy gives the lowest priority to Level 3 inputs.

In determining fair value, the Company utilizes valuation techniques that maximize the use of observable inputs. In addition, the Company considers counterparty credit risk in the assessment of fair value.

The Company’s financial assets and liabilities carried at fair value as of July 4, 2026, are classified below (in millions):

			Level 1						Level 2						Level 3						Total
Assets:
Foreign exchange contracts (1)			$	2					$	17					$	—					$	19
Investments related to the deferred compensation plan			51						—						—						51
Total Assets at fair value			$	53					$	17					$	—					$	70
Liabilities:
Liabilities related to the deferred compensation plan			$	51					$	—					$	—					$	51
Total Liabilities at fair value			$	51					$	—					$	—					$	51

The Company’s financial assets and liabilities carried at fair value as of December 31, 2025, are classified below (in millions):

			Level 1						Level 2						Level 3						Total
Assets:
Investments related to the deferred compensation plan			$	48					$	—					$	—					$	48
Total Assets at fair value			$	48					$	—					$	—					$	48
Liabilities:
Foreign exchange contracts (1)			$	2					$	5					$	—					$	7
Liabilities related to the deferred compensation plan			48						—						—						48
Total Liabilities at fair value			$	50					$	5					$	—					$	55

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(1)The fair value of the foreign exchange contracts is calculated as follows:

•Fair value of forward contracts associated with forecasted sales hedges is calculated using the period-end exchange rate adjusted for current forward points (Level 2).

•Fair value of hedges against net assets denominated in foreign currencies is calculated at the period-end exchange rate adjusted for current forward points (Level 2). However, if the hedge has matured but not yet settled as of period end, then the fair value is calculated at the amount at which the hedge is being settled (Level 1).

Note 9 Derivative Instruments

In the normal course of business, the Company is exposed to global market risks, including the effects of changes in foreign currency exchange rates and interest rates. The Company commonly uses derivative instruments to manage its exposure to such risks and may elect to designate certain derivatives as hedging instruments under ASC Topic 815, Derivatives and Hedging (“ASC 815”). The Company formally documents all relationships between designated hedging instruments and hedged items as well as its risk management objectives and strategies for undertaking hedge transactions. The Company does not hold or issue derivatives for trading or speculative purposes.

In accordance with ASC 815, the Company recognizes derivative instruments as either assets or liabilities on the Consolidated Balance Sheets and measures them at fair value. The following table presents the fair value of its derivative instruments (in millions):

			Asset (Liability)
									Fair Values as of
			Balance Sheets Classification						July 4, 2026						December 31, 2025
Derivative instruments designated as hedges:
Foreign exchange contracts			Prepaid expenses and other current assets						$	17					$	—
Foreign exchange contracts			Accrued liabilities						—						(5)
Total derivative instruments designated as hedges									$	17					$	(5)
Derivative instruments not designated as hedges:
Foreign exchange contracts			Prepaid expenses and other current assets						$	2					$	—
Foreign exchange contracts			Accrued liabilities						—						(2)
Total derivative instruments not designated as hedges									$	2					$	(2)
Total net derivative asset (liability)									$	19					$	(7)

Activities related to derivative instruments are reflected within Net cash provided by operating activities on the Consolidated Statements of Cash Flows.

Interest Rate Risk Management

The Company is exposed to market risk associated with interest rate payments on its borrowings under a term loan (“Term Loan A”), Revolving Credit Facility, and Receivables Financing Facilities, which bear interest at variable rates plus applicable margins. The Company manages its exposure to changes in interest rates by issuing both fixed and variable rate borrowings as well as periodically utilizing interest rate swaps to economically hedge interest rate exposure based on current and projected market conditions. The Company had no active interest rate swap agreements during the six months ended July 4, 2026 or the year ended December 31, 2025.

Foreign Currency Exchange Risk Management

The Company conducts business on a multinational basis in a variety of foreign currencies. Exposure to market risk for changes in foreign currency exchange rates arises primarily from Euro-denominated external revenues, cross-border financing activities between subsidiaries, and foreign currency denominated monetary assets and liabilities. The Company manages its objective of preserving the economic value of non-functional currency denominated cash flows by initially hedging transaction exposures with natural offsets and, once these opportunities have been exhausted, through foreign exchange forward and option contracts, as deemed appropriate.

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The Company manages the exchange rate risk of anticipated Euro-denominated sales using forward contracts, which typically mature within twelve months of execution. The Company designates these derivative contracts as cash flow hedges. Unrealized gains and losses on these contracts are deferred in Accumulated other comprehensive income (loss) (“AOCI”) on the Consolidated Balance Sheets until the contract is settled and the hedged sale is realized. The realized gain or loss is then recorded as an adjustment to Net sales on the Consolidated Statements of Operations. Realized amounts reclassified to Net sales were $2 million of gains and $13 million of losses for the three months ended July 4, 2026 and June 28, 2025, respectively. Realized amounts reclassified to Net sales were $5 million of losses and $4 million of losses for the six months ended July 4, 2026 and June 28, 2025, respectively. As of July 4, 2026 and December 31, 2025, the notional amounts of the Company’s foreign exchange cash flow hedges were €637 million and €582 million, respectively. The Company has reviewed its cash flow hedges for effectiveness and determined that they are highly effective.

The Company uses forward contracts, which are not designated as hedging instruments, to manage its exposures related to net assets denominated in foreign currencies. These forward contracts typically mature within one month after execution. Monetary gains and losses on these forward contracts are recorded in income and are generally offset by the transaction gains and losses related to their net asset positions. Net amounts recognized within Foreign exchange loss were $1 million of losses and $15 million of losses for the three months ended July 4, 2026 and June 28, 2025, respectively. There were no net amounts recognized within Foreign exchange loss for the six months ended July 4, 2026 and $23 million of losses for the six months ended June 28, 2025. The notional values and the net fair values of these outstanding contracts were as follows (in millions):

			July 4, 2026						December 31, 2025
Notional balance of outstanding contracts:
British Pound/U.S. Dollar			£	3					£	14
Euro/U.S. Dollar			€	128					€	92
Euro/Czech Koruna			€	12					€	13
Japanese Yen/U.S. Dollar			¥	593					¥	395
Singapore Dollar/U.S. Dollar			S$	19					S$	16
Mexican Peso/U.S. Dollar			Mex$	281					Mex$	250
Polish Zloty/U.S. Dollar			zł	28					zł	71
Net fair value of assets (liabilities) of outstanding contracts			$	2					$	(2)

Credit and Market Risk Management

Financial instruments, including derivatives, expose the Company to counterparty credit risk of nonperformance and to market risk related to currency exchange rate and interest rate fluctuations. The Company manages its exposure to counterparty credit risk by establishing minimum credit standards, diversifying its counterparties, and monitoring its concentrations of credit. The Company’s counterparties are commercial banks with expertise in derivative financial instruments. The Company evaluates the impact of market risk on the fair value and cash flows of its derivative and other financial instruments by considering reasonably possible changes in interest rates and currency exchange rates. The Company continually monitors the creditworthiness of the customers to which it grants credit terms in the normal course of business. The terms and conditions of the Company’s credit policies are designed to mitigate concentrations of credit risk.

The Company’s master netting and other similar arrangements with the respective counterparties allow for net settlement under certain conditions, which are designed to reduce credit risk by permitting net settlement with the same counterparty. We present the assets and liabilities of our derivative financial instruments, for which we have net settlement agreements in place, on a net basis on the Consolidated Balance Sheets. If the derivative financial instruments had been presented gross on the Consolidated Balance Sheets, the asset and liability positions would not have been significantly different as of July 4, 2026 or December 31, 2025.

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Note 10 Long-Term Debt

The following table shows the carrying value of the Company’s debt (in millions):

			July 4, 2026						December 31, 2025
Term Loan A			$	1,531					$	1,575
Senior Notes			500						500
Revolving Credit Facility			565						275
Receivables Financing Facility			180						161
Total debt			$	2,776					$	2,511
Less: Debt issuance costs			(7)						(8)
Less: Unamortized discounts			(1)						(2)
Less: Current portion of debt			(2,275)						(141)
Total long-term debt			$	493					$	2,361

As of July 4, 2026, the future maturities of debt are as follows (in millions):

2026 (6 months remaining)						$	116
2027						2,160
2028						—
2029						—
2030						—
Thereafter						500
Total future maturities of debt						$	2,776

All borrowings as of July 4, 2026 were denominated in U.S. Dollars.

The estimated fair value of the Company’s debt approximated $2.8 billion and $2.5 billion as of July 4, 2026 and December 31, 2025, respectively. These fair value amounts, developed based on inputs classified as Level 2 within the fair value hierarchy, represent the estimated value at which the Company’s lenders could trade its debt within the financial markets and do not represent the settlement value of these liabilities to the Company. The fair value of debt will continue to vary each period based on a number of factors, including fluctuations in market interest rates as well as changes to the Company’s credit ratings.

Term Loan A

The principal on Term Loan A is due in quarterly installments, with the next quarterly installment due in the third quarter of 2026 and the majority due upon maturity on May 25, 2027. The Company has made and may make prepayments in whole or in part, without premium or penalty, and would be required to prepay certain outstanding amounts in the event of certain circumstances or transactions. As of July 4, 2026, the Term Loan A interest rate was 4.99%. Interest payments are made monthly and are subject to variable rates plus an applicable margin.

Senior Notes

The Company’s senior unsecured notes (the “Senior Notes”) have a 6.5% fixed interest rate. The Senior Notes mature on June 1, 2032, and interest is payable semi-annually in arrears in June and December of each year. The Company has the option to or could be required to prepay certain outstanding amounts in the event of certain circumstances or transactions.

The Senior Notes are fully and unconditionally guaranteed on a senior unsecured basis by certain of Zebra’s existing and future subsidiaries. The Senior Notes contain covenants that, among other things, limit the ability of Zebra to: (i) grant or incur liens; (ii) have its subsidiaries guarantee debt without becoming guarantors; and (iii) merge or consolidate with another company or sell all or substantially all of its assets.

Revolving Credit Facility

The Company has a Revolving Credit Facility that is available for working capital and other general business purposes, including letters of credit. As of July 4, 2026, the Company had letters of credit totaling $10 million, which reduced remaining funds available for borrowings under the Revolving Credit Facility to $925 million. As of July 4, 2026, the Revolving Credit Facility had an average interest rate of 5.02%. Interest payments are made monthly and are subject to variable rates plus an applicable margin. The Revolving Credit Facility matures on May 25, 2027.

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Receivables Financing Facility

The Company has a Receivables Financing Facility with a borrowing limit of up to $180 million. As collateral, the Company pledges perfected first-priority security interests in its U.S. domestically originated accounts receivable. The Company has accounted for transactions under this facility as secured borrowings. The receivables financing facility matures on March 19, 2027.

As of July 4, 2026, the Company’s Consolidated Balance Sheets included $810 million of gross receivables that were pledged under the facility. Borrowings under the facility bear interest at a variable rate plus an applicable margin. As of July 4, 2026, the facility had an average interest rate of 4.72%. Interest is paid monthly on these borrowings.

The Company’s borrowings described above include terms and conditions that limit the incurrence of additional borrowings and require that certain financial ratios be maintained at designated levels.

As of July 4, 2026, the Company was in compliance with all debt covenants.

Note 11 Leases

During the six months ended July 4, 2026, the Company recorded $22 million of right-of-use (“ROU”) assets obtained in exchange for lease obligations related to extensions of existing leases and commencements of new leases.

Future minimum lease payments under non-cancellable leases as of July 4, 2026 were as follows (in millions):

2026 (6 months remaining)						$	27
2027						46
2028						40
2029						33
2030						26
Thereafter						64
Total future minimum lease payments						$	236
Less: Interest						(42)
Present value of lease liabilities						$	194
Reported as of July 4, 2026:
Current portion of lease liabilities						$	38
Long-term lease liabilities						156
Present value of lease liabilities						$	194

The current portion of lease liabilities is included within Accrued liabilities on the Consolidated Balance Sheets.

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Note 12 Accrued Liabilities, Commitments and Contingencies

Accrued Liabilities

The components of Accrued liabilities are as follows (in millions):

			July 4, 2026						December 31, 2025
Incentive compensation			$	109					$	150
Payroll and benefits			77						75
Customer rebates			74						63
Unremitted cash collections due to banks on factored accounts receivable			68						84
Current portion of lease liabilities			38						38
Freight and duty			30						26
Current portion of warranty liabilities			29						28
Exit and restructuring			15						23
Other			66						71
Accrued liabilities			$	506					$	558

Warranties

The following table is a summary of the Company’s warranty obligations (in millions):

			Six Months Ended
			July 4, 2026						June 28, 2025
Balance at the beginning of the period			$	34					$	26
Warranty expense			18						18
Warranties fulfilled			(17)						(17)
Balance at the end of the period			$	35					$	27

The current and long-term portions of our warranty obligations are included on the Consolidated Balance Sheets within Accrued liabilities and Other long-term liabilities, respectively.

Contingencies

The Company is subject to a variety of investigations, claims, suits, and other legal proceedings that arise from time to time in the ordinary course of business, including but not limited to, intellectual property, employment, tort, and breach of contract matters. The Company currently believes that the outcomes of such proceedings, individually and in the aggregate, will not have a material adverse impact on its business, cash flows, financial position, or results of operations. Any legal proceedings are subject to inherent uncertainties, and the Company’s view of these matters and their potential effects may change in the future. The Company records a liability for contingencies when a loss is deemed to be probable and the loss can be reasonably estimated.

On February 20, 2026, the U.S. Supreme Court ruled that the International Emergency Economic Powers Act (“IEEPA”) does not authorize the executive branch of government to impose tariffs, which invalidated certain import tariffs enacted in 2025. The matter was remanded to the Court of International Trade and the U.S. Customs and Border Protection (“CBP”) for administration of refunds. The Company has commenced the process of seeking refunds in accordance with the process prescribed by CBP. The Company has evaluated potential refunds of previously paid IEEPA tariffs under a loss recovery model consistent with the principles of ASC 410‑30, Asset Retirement and Environmental Obligations — Environmental Obligations. In the second quarter of 2026, the Company deemed the refund of all previously paid import tariffs to be probable and recognized a benefit of approximately $73 million within Cost of Sales on the Consolidated Statements of Operations, including $46 million attributed to the CF segment and $27 million attributed to the AVA segment. As of July 4, 2026, the Company received $14 million in cash and $59 million is reflected within Accounts Receivable, net on the Consolidated Balance Sheets. An additional $27 million in cash refunds was received through July 31, 2026.

Note 13 Share-Based Compensation

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On May 19, 2026, the Company’s stockholders approved the Zebra Technologies Corporation 2026 Long-Term Incentive Plan (the “2026 LTIP”). The 2026 LTIP superseded and replaced all other prior plans, except that the prior plans shall remain in effect with respect to outstanding awards issued under the prior plans until such awards have been exercised, forfeited, canceled, expired or otherwise terminated in accordance with their terms.

The 2026 LTIP provides for incentive compensation to the Company’s non-employee directors, officers and employees. Awards available under the 2026 LTIP include stock-settled awards, such as stock-settled restricted stock units, stock-settled performance stock units, restricted stock awards, performance share awards, stock appreciation rights, incentive stock options, and nonqualified stock options. Awards available under the 2026 LTIP also include cash-settled awards, such as cash-settled restricted stock units, performance stock units, and stock appreciation rights.

The Company uses treasury shares as its source for issuing shares under the share-based compensation programs. As of July 4, 2026, 1,809,099 shares of Class A Common Stock remain available to be issued under the 2026 LTIP.

Note 14 Income Taxes

The Company’s effective tax rate for the three and six months ended July 4, 2026 was 18.2% and 18.6%, respectively, compared to 18.8% and 18.2% for the three and six months ended June 28, 2025, respectively. In both the current and prior periods, the variance from the 21% federal statutory rate was primarily attributable to U.S. tax credits and the tax benefit related to foreign earnings subject to U.S. taxation, partially offset by foreign rate differential and U.S. state income taxes.

Note 15 Earnings Per Share

Basic net earnings per share is calculated by dividing net income by the weighted average number of common shares outstanding for the period. Diluted earnings per share is computed by dividing net income by the weighted average number of diluted common shares outstanding. Diluted common shares outstanding is computed using the Treasury Stock method and, in periods of income, reflects the additional shares that would be outstanding if dilutive share-based compensation awards were converted into common shares during the period.

Earnings per share (in millions, except share data):

			Three Months Ended												Six Months Ended
			July 4, 2026						June 28, 2025						July 4, 2026						June 28, 2025
Basic:
Net income			$	233					$	112					$	368					$	248
Weighted-average shares outstanding			47,717,205						50,939,474						48,364,994						51,154,241
Basic earnings per share			$	4.89					$	2.20					$	7.61					$	4.85
Diluted:
Net income			$	233					$	112					$	368					$	248
Weighted-average shares outstanding			47,717,205						50,939,474						48,364,994						51,154,241
Dilutive shares			412,060						342,799						411,555						392,169
Diluted weighted-average shares outstanding			48,129,265						51,282,273						48,776,549						51,546,410
Diluted earnings per share			$	4.85					$	2.19					$	7.54					$	4.81

Anti-dilutive share-based compensation awards are excluded from diluted earnings per share calculations. There were 95,443 and 206,083 shares that were anti-dilutive for the three and six months ended July 4, 2026. There were 199,500 and 126,172 shares that were anti-dilutive for the three and six months ended June 28, 2025, respectively.

Note 16 Accumulated Other Comprehensive (Loss) Income

Stockholders’ equity includes certain items classified as AOCI, including:

•Unrealized gain (loss) on sales hedging which relates to derivative instruments used to hedge the exposure related to currency exchange rates for forecasted Euro sales. These hedges are designated as cash flow hedges, and the Company

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defers income statement recognition of gains and losses until the hedged transaction occurs. See Note 9, Derivative Instruments for more details.

•Foreign currency translation adjustments which relates to the Company’s non-U.S. subsidiary companies that have designated a functional currency other than the U.S. Dollar. The Company translates the subsidiary functional currency financial statements to U.S. Dollars using a combination of historical, period-end, and average foreign exchange rates. This combination of rates creates the foreign currency translation adjustment component of AOCI.

The changes in each component of AOCI during the six months ended July 4, 2026 and June 28, 2025 were as follows (in millions):

						Unrealized gain (loss) on sales hedging												Foreign currency translation adjustments						Total
Balance at December 31, 2024						$	22											$	(66)					$	(44)
Other comprehensive (loss) income before reclassifications						(85)												27						(58)
Amounts reclassified from AOCI(1)						4												—						4
Tax effect						20												—						20
Other comprehensive (loss) income, net of tax						(61)												27						(34)
Balance at June 28, 2025						$	(39)											$	(39)					$	(78)
Balance at December 31, 2025						$	(4)											$	(14)					$	(18)
Other comprehensive income (loss) before reclassifications						17												(37)						(20)
Amounts reclassified from AOCI(1)						5												—						5
Tax effect						(5)												—						(5)
Other comprehensive income (loss), net of tax						17												(37)						(20)
Balance at July 4, 2026						$	13											$	(51)					$	(38)

(1) See Note 9, Derivative Instruments regarding the timing of reclassifications to operating results.

Note 17 Accounts Receivable Factoring

The Company has a Receivables Factoring arrangement, pursuant to which certain receivables originated from the EMEA and Asia-Pacific regions up to a maximum of €150 million are sold to a bank without recourse in exchange for cash. Such transfers are accounted for as sales and the related receivables are removed from the Company’s balance sheet. The Company does not maintain any beneficial interest in the receivables sold. The Company services the receivables on behalf of the bank, but otherwise maintains no significant continuing involvement with respect to the receivables. Sale proceeds that are representative of the fair value of factored receivables, less a factoring fee, are reflected in Cash flows from operating activities on the Consolidated Statements of Cash Flows, while sale proceeds in excess of the fair value of factored receivables are reflected in Cash flows from financing activities on the Consolidated Statements of Cash Flows.

During the six months ended July 4, 2026 and June 28, 2025, the Company received cash proceeds of $272 million and $246 million, respectively, from the sales of accounts receivables under its factoring arrangement. As of July 4, 2026 and December 31, 2025, there were a total of $18 million and $10 million, respectively, of uncollected receivables that had been sold and removed from the Company’s Consolidated Balance Sheets.

As servicer of sold receivables, the Company had $68 million and $84 million of obligations that were not yet remitted to the bank as of July 4, 2026 and December 31, 2025, respectively. These obligations are included within Accrued liabilities on the Consolidated Balance Sheets, with changes in such obligations reflected within Cash flows from financing activities on the Consolidated Statements of Cash Flows.

Note 18 Segment Information & Geographic Data

The Company’s operations consist of two reportable segments that provide complementary offerings to our customers: Connected Frontline (“CF”), which includes mobile computing and related services and software-based offerings; and Asset Visibility & Automation (“AVA”), which includes barcode and card printing and related supplies and sensors, RFID and RTLS offerings, data capture, machine vision offerings, and related services.

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The reportable segments have been identified based on the financial data utilized by the Company’s Chief Executive Officer (the chief operating decision maker or “CODM”) to assess segment performance and allocate resources among the Company’s segments. The CODM reviews operating income to assess segment profitability monthly as well as part of the Company’s budget and forecasting process. The CODM assesses the profitability of each segment relative to its long-term growth objectives in evaluating resource allocation priorities. Segment assets are not reviewed by the Company’s CODM and therefore are not disclosed below.

Financial information by segment is presented as follows (in millions):

			Three Months Ended												Six Months Ended
			July 4, 2026						June 28, 2025						July 4, 2026						June 28, 2025
Net sales:
CF			$	903					$	717					$	1,728					$	1,401
AVA			654						576						1,324						1,200
Total Net sales			$	1,557					$	1,293					$	3,052					$	2,601
Cost of sales:
CF			$	441					$	378					$	861					$	729
AVA			286						296						608						604
Corporate (3)			5						3						16						7
Total Cost of sales			$	732					$	677					$	1,485					$	1,340
Operating expenses:
CF (1)			$	243					$	197					$	479					$	390
AVA (1)			176						173						365						354
Corporate (3)			85						63						187						139
Total Operating expenses			$	504					$	433					$	1,031					$	883
Operating income:
CF (2)			$	219					$	142					$	388					$	282
AVA (2)			192						107						351						242
Total segment operating income			$	411					$	249					$	739					$	524
Corporate (3)			(90)						(66)						(203)						(146)
Total Operating income			$	321					$	183					$	536					$	378

(1)CF and AVA segment operating expenses include Selling and marketing, Research and development, and General and administrative expenses, excluding the amounts classified within Corporate.

(2)CF and AVA segment operating income includes depreciation expense proportionate to each segment’s Net sales.

(3)To the extent applicable, amounts included in Corporate consist of Share-based compensation, Amortization of intangible assets, Acquisition and integration costs, Exit and restructuring costs, as well as certain other non-recurring costs (impairment of goodwill and other intangible assets, and business acquisition purchase accounting adjustments).

Information regarding the Company’s operations by geographic area is contained in the following tables. Net sales amounts are attributed to geographic area based on customer location.

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Net sales by region were as follows (in millions)(1):

			Three Months Ended												Six Months Ended
			July 4, 2026						June 28, 2025						July 4, 2026						June 28, 2025
North America			$	774					$	638					$	1,502					$	1,277
EMEA			498						418						1,005						866
Asia-Pacific			181						147						348						284
Latin America			104						90						197						174
Total Net sales			$	1,557					$	1,293					$	3,052					$	2,601

(1)Certain prior period net sales have been recast to appropriately reflect customer location, with no impact to Zebra’s consolidated net sales.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Overview

We are a global leader in the Automatic Identification and Data Capture (“AIDC”) industry. The AIDC market consists of mobile computing, data capture, radio frequency identification devices (“RFID”), thermal barcode printing, and other workflow automation products and services. The Company’s offerings are proven to help our customers and end-users digitize and automate their workflows to achieve their critical business objectives, including improved productivity and operational efficiency, optimized regulatory compliance, and better customer experiences.

We design, manufacture, and sell a broad range of AIDC offerings, including: mobile computers, barcode scanners and imagers, RFID readers, specialty printers for barcode labeling and personal identification, real-time location systems (“RTLS”), related accessories and supplies, such as labels and other consumables, and related software applications. We also provide machine vision and self-serve touchscreen solutions; a full range of services, including maintenance, technical support, repair, managed and professional services; as well as cloud-based software subscriptions. End-users of our offerings include those in retail and e-commerce, manufacturing, transportation and logistics, healthcare, hospitality, public sector, and other industries.

We continue to evolve and advance our vision: frontline operations everywhere are digitized, automated and intelligent. Through continual innovation, we have expanded beyond the traditional AIDC market to transform activities such as factory production, packages moving through a supply chain, retail shopping, the hospital patient journey, restaurant self-service, and first responders addressing public safety and emergency situations. Data from enterprise assets, including status, condition, location, utilization, and preferences, is analyzed to provide prioritized actionable insights and optimize activities.

The Company’s operations consist of two reportable segments that provide complementary offerings to our customers: Connected Frontline (“CF”) and Asset Visibility & Automation (“AVA”).

•The CF segment is focused on unifying teams, customers, and AI agents to deliver enhanced frontline experiences. This segment brings together solutions that empower frontline workers with the information and tools they need to make smarter decisions and improve customer service. Principal product categories include mobile computing, point of sale solutions, self-service kiosks and interactive touchscreen displays, workflow optimization software solutions, and related services.

•The AVA segment provides solutions that track critical assets and automate workflows to provide the real-time, data-driven insights necessary to optimize supply chains, manufacturing, and logistics. The principal product categories include thermal barcode printing and related supplies and sensors, data capture, fixed industrial scanning, machine vision, RFID, real-time location systems (RTLS), and related services.

Second Quarter 2026 Financial Summary and Other Recent Developments

•Net sales were $1,557 million in the current quarter compared to $1,293 million in the prior year second quarter.

•Operating income was $321 million in the current quarter compared to $183 million in the prior year second quarter.

•Net income was $233 million, or $4.85 per diluted share in the current quarter, compared to net income of $112 million, or $2.19 per diluted share in the prior year second quarter.

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•We recognized a $73 million pretax benefit from the expected refund of previously paid import tariffs, with $14 million of cash received in the second quarter.

•We repurchased $568 million of common shares year to date, including $268 million in the second quarter.

IEEPA Import Tariffs:

On February 20, 2026, the U.S. Supreme Court invalidated certain import tariffs enacted in 2025 under the International Emergency Economic Powers Act (“IEEPA”). The Company is in the process of seeking the refund of its approximately $73 million of previously paid import tariffs in accordance with the process defined by the U.S. Customs and Border Protection. During the second quarter of 2026, the Company recognized the benefit of approximately $73 million in expected refunds within Cost of Sales on the Consolidated Statements of Operations, including $46 million attributed to the CF segment and $27 million attributed to the AVA segment.

See Note 12, Accrued Liabilities, Commitments and Contingencies in the Notes to Consolidated Financial Statements for further information related to this matter.

Exit & Restructuring Actions:

In the second quarter, we substantially completed our actions under the previously announced 2025 Productivity Plan and recorded an additional $8 million in severance and related costs. Cumulative one-time charges under this plan, which was initiated last year, were $37 million. We expect these actions to achieve net annualized pre-tax cost savings of approximately $35 million. The majority of the remaining obligations associated with these actions are expected to be satisfied in the second half of 2026.

See Note 7, Exit and Restructuring Activities in the Notes to Consolidated Financial Statements for further information related to the Company’s exit and restructuring actions.

Results of Operations

Consolidated Results of Operations

(amounts in millions, except percentages)

			Three Months Ended																								Six Months Ended
			July 4, 2026						June 28, 2025						$ Change						% Change						July 4, 2026						June 28, 2025						$ Change						% Change
Net sales:
Tangible products			$	1,316					$	1,055					$	261					24.7		%				$	2,547					$	2,117					$	430					20.3		%
Services and software			241						238						3						1.3		%				505						484						21						4.3		%
Total Net sales			1,557						1,293						264						20.4		%				3,052						2,601						451						17.3		%
Gross profit			825						616						209						33.9		%				1,567						1,261						306						24.3		%
Gross margin			53.0		%				47.6		%										540 bps						51.3		%				48.5		%										280 bps
Operating expenses			504						433						71						16.4		%				1,031						883						148						16.8		%
Operating income			$	321					$	183					$	138					75.4		%				$	536					$	378					$	158					41.8		%

Net sales to customers by geographic region were as follows (amounts in millions, except percentages):

			Three Months Ended																								Six Months Ended
			July 4, 2026						June 28, 2025						$ Change						% Change						July 4, 2026						June 28, 2025						$ Change						% Change
North America			$	774					$	638					$	136					21.3		%				$	1,502					$	1,277					$	225					17.6		%
EMEA			498						418						80						19.1		%				1,005						866						139						16.1		%
Asia-Pacific			181						147						34						23.1		%				348						284						64						22.5		%
Latin America			104						90						14						15.6		%				197						174						23						13.2		%
Total Net sales			$	1,557					$	1,293					$	264					20.4		%				$	3,052					$	2,601					$	451					17.3		%

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Operating expenses are summarized below (amounts in millions, except percentages):

			Three Months Ended																								Six Months Ended
			July 4, 2026						June 28, 2025						As a % of Net sales												July 4, 2026						June 28, 2025						As a % of Net sales
															2026						2025																		2026						2025
Selling and marketing			$	184					$	158					11.8		%				12.2		%				$	373					$	319					12.2		%				12.3		%
Research and development			159						144						10.2		%				11.1		%				324						295						10.6		%				11.3		%
General and administrative			114						102						7.3		%				7.9		%				241						213						7.9		%				8.2		%
Amortization of intangible assets			37						25						NM						NM						74						49						NM						NM
Acquisition and integration costs			2						4						NM						NM						3						7						NM						NM
Exit and restructuring costs			8						—						NM						NM						16						—						NM						NM
Total Operating expenses			$	504					$	433					32.4		%				33.5		%				$	1,031					$	883					33.8		%				33.9		%

Consolidated Organic Net sales growth:

			Three Months Ended						Six Months Ended
			July 4, 2026						July 4, 2026
Reported GAAP Consolidated Net sales growth			20.4		%				17.3		%
Adjustments:
Impact of foreign currency translations (1)			(2.5)		%				(2.2)		%
Impact of acquisitions and dispositions (2)			(8.7)		%				(8.3)		%
Consolidated Organic Net sales growth (3)			9.2		%				6.8		%

(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 as well as removing realized cash flow hedge gains and losses from both the current and prior year periods.

(2)For purposes of computing Organic Net sales growth, amounts attributable to business acquisitions or dispositions are excluded for twelve months following or preceding the respective acquisition or disposition, respectively.

(3)Consolidated Organic Net sales growth is a non-GAAP financial measure. See the Non-GAAP Measures section at the end of this item.

Second quarter 2026 compared to Second quarter 2025

Total Net sales increased by $264 million or 20.4% compared to the prior year quarter, reflecting growth in both of our segments. Our overall sales growth reflects improved demand in all regions. Excluding the effects of foreign currency, acquisitions and dispositions, Consolidated Organic Net sales increased by 9.2%.

Gross margin increased to 53.0% for the current quarter compared to 47.6% for the prior year quarter, primarily due to the favorable impacts of IEEPA tariff recoveries and foreign currency. We also fully mitigated increased memory costs through price realization.

Operating expenses for the quarters ended July 4, 2026 and June 28, 2025 were $504 million and $433 million, or 32.4% and 33.5% of Net sales, respectively. Current quarter Operating expenses increased compared to the prior year quarter primarily due to the inclusion of operating expenses of Elo Touch, including intangible asset amortization, as well as higher employee-related costs.

Operating income was $321 million for the current quarter compared to $183 million in the prior year quarter.

Total Other expense, net decreased primarily due to net losses on long-term investments in the prior year quarter and lower foreign exchange losses in the current quarter, partially offset by higher interest expense associated with higher average debt balances.

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The Company’s effective tax rates for the three months ended July 4, 2026 and June 28, 2025 were 18.2% and 18.8%, respectively. The decrease in the effective tax rate was primarily due to tax benefits related to foreign earnings subject to U.S. taxation, partially offset by increased U.S. state income taxes.

Year to date 2026 compared to Year to date 2025

Total Net sales increased by $451 million or 17.3% compared to the prior year, reflecting growth in both of our segments. Our overall sales growth reflects improved demand in all regions. Excluding the effects of foreign currency, acquisitions and dispositions, Consolidated Organic Net sales increased by 6.8%.

Gross margin increased to 51.3% for the current year compared to 48.5% for the prior year, primarily due to favorable impacts of IEEPA tariff recoveries and foreign currency.

Operating expenses for the quarters ended July 4, 2026 and June 28, 2025 were $1,031 million and $883 million, or 33.8% and 33.9% of Net sales, respectively. Current year Operating expenses increased compared to the prior year primarily due to the inclusion of operating expenses of Elo Touch, including intangible asset amortization, as well as higher employee-related costs.

Operating income was $536 million for the current year compared to $378 million in the prior year.

Total Other expense, net increased primarily due to lower interest income on cash equivalents and higher interest expense associated with higher average debt balances, partially offset by lower foreign exchange losses.

The Company’s effective tax rates for the six months ended July 4, 2026 and June 28, 2025 were 18.6% and 18.2%, respectively. The increase in the effective tax rate was primarily due to higher U.S. state income taxes and less favorability from tax credits, partially offset by increased tax benefits related to foreign earnings subject to U.S. taxation.

Results of Operations by Segment

The following commentary should be read in conjunction with the financial results of each reportable business segment as detailed in Note 18, Segment Information & Geographic Data in the Notes to Consolidated Financial Statements. To the extent applicable, segment operating income excludes Share-based Compensation, Amortization of intangible assets, Acquisition and integration costs, Exit and restructuring costs, as well as certain other non-recurring costs (impairment of goodwill and other intangible assets, and business acquisition purchase accounting adjustments).

Connected Frontline Segment (“CF”)

(amounts in millions, except percentages)

			Three Months Ended																								Six Months Ended
			July 4, 2026						June 28, 2025						$ Change						% Change						July 4, 2026						June 28, 2025						$ Change						% Change
Net sales:
Tangible products			$	706					$	521					$	185					35.5		%				$	1,315					$	1,002					$	313					31.2		%
Services and software			197						196						1						0.5		%				413						399						14						3.5		%
Total Net sales			903						717						186						25.9		%				1,728						1,401						327						23.3		%
Gross profit			462						339						123						36.3		%				867						672						195						29.0		%
Gross margin			51.2		%				47.3		%										390 bps						50.2		%				48.0		%										220 bps
Operating expenses			243						197						46						23.4		%				479						390						89						22.8		%
Operating income			$	219					$	142					$	77					54.2		%				$	388					$	282					$	106					37.6		%

CF Organic Net sales growth:

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			Three Months Ended						Six Months Ended
			July 4, 2026						July 4, 2026
CF Reported GAAP Net sales growth			25.9		%				23.3		%
Adjustments:
Impact of foreign currency translations (1)			(2.5)		%				(2.3)		%
Impact of acquisitions (2)			(15.9)		%				(15.3)		%
CF Organic Net sales growth (3)			7.5		%				5.7		%

(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 as well as removing realized cash flow hedge gains and losses from both the current and prior year periods.

(2)For purposes of computing Organic Net sales growth, amounts directly attributable to the acquisition of Elo Touch are excluded for twelve months following the September 30, 2025 acquisition date.

(3)CF Organic Net sales growth is a non-GAAP financial measure. See the Non-GAAP Measures section at the end of this item.

Second quarter 2026 compared to Second quarter 2025

Total Net sales for CF increased $186 million or 25.9% compared to the prior year, primarily due to the inclusion of Elo Touch, higher sales of mobile computers, and favorable impact of foreign currency. Excluding the impact of foreign currency and the acquisition of Elo Touch, CF Organic Net sales increased by 7.5%.

Gross margin increased to 51.2% in the current year compared to 47.3% for the prior year quarter, primarily due to favorable impacts of IEEPA tariff recoveries and foreign currency, partially offset by unfavorable business mix.

Operating income increased 54.2% in the current year compared to the prior year.

Year to date 2026 compared to Year to date 2025

Total Net sales for CF increased $327 million or 23.3% compared to the prior year, primarily due to the inclusion of Elo Touch, higher sales of mobile computers, and favorable impact of foreign currency. Excluding the impact of foreign currency and the acquisition of Elo Touch, CF Organic Net sales increased by 5.7%.

Gross margin increased to 50.2% in the current year compared to 48.0% for the prior year, primarily due to favorable impacts of IEEPA tariff recoveries and foreign currency, partially offset by unfavorable business mix.

Operating income increased 37.6% in the current year compared to the prior year.

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Asset Visibility & Automation Segment (“AVA”)

(amounts in millions, except percentages)

			Three Months Ended																								Six Months Ended
			July 4, 2026						June 28, 2025						$ Change						% Change						July 4, 2026						June 28, 2025						$ Change						% Change
Net sales:
Tangible products			$	610					$	534					$	76					14.2		%				$	1,232					$	1,115					$	117					10.5		%
Services and software			44						42						2						4.8		%				92						85						7						8.2		%
Total Net sales			654						576						78						13.5		%				1,324						1,200						124						10.3		%
Gross profit			368						280						88						31.4		%				716						596						120						20.1		%
Gross margin			56.3		%				48.6		%										770 bps						54.1		%				49.7		%										440 bps
Operating expenses			176						173						3						1.7		%				365						354						11						3.1		%
Operating income			$	192					$	107					$	85					79.4		%				$	351					$	242					$	109					45.0		%

AVA Organic Net sales growth:

			Three Months Ended						Six Months Ended
			July 4, 2026						July 4, 2026
AVA Reported GAAP Net sales growth			13.5		%				10.3		%
Adjustments:
Impact of foreign currency translations (1)			(2.3)		%				(2.2)		%
Impact of acquisitions and dispositions (2)			0.2		%				(0.1)		%
AVA Organic Net sales growth (4)			11.4		%				8.0		%

(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 as well as removing realized cash flow hedge gains and losses from both the current and prior year periods.

(2)For purposes of computing AVA Organic Net sales growth, amounts directly attributable to the acquisition of Photoneo and the disposition of the robotics automation business are excluded for twelve months following or preceding the respective acquisition or disposition, respectively.

(3)AVA Organic Net sales growth is a non-GAAP financial measure. See the Non-GAAP Measures section at the end of this item.

Second quarter 2026 compared to Second quarter 2025

Total Net sales for AVA increased $78 million or 13.5% compared to the prior year, primarily due to higher sales of printing and machine vision products and favorable impact of foreign currency. Excluding the impacts of foreign currency and acquisitions and dispositions, AVA Organic Net sales increased by 11.4%.

Gross margin increased to 56.3% in the current year compared to 48.6% for the prior year, primarily due to favorable impacts of IEEPA tariff recoveries, business mix, and foreign currency.

Operating income for the current year increased by 79.4% compared to the prior year.

Year to date 2026 compared to Year to date 2025

Total Net sales for AVA increased $124 million or 10.3% compared to the prior year, primarily due to higher sales of printing and machine vision products and favorable impact of foreign currency. Excluding the impacts of foreign currency and acquisitions and dispositions, AVA Organic Net sales increased by 8.0%.

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Gross margin increased to 54.1% in the current year compared to 49.7% for the prior year, primarily due to favorable impacts of IEEPA tariff recoveries, business mix, and foreign currency.

Operating income for the current year increased by 45.0% compared to the prior year.

Liquidity and Capital Resources

The primary factors that influence our liquidity include the amount and timing of cash collections from our customers, cash payments to our suppliers, capital expenditures, acquisitions, and share repurchases. Management believes that our existing capital resources, inclusive of available borrowing capacity on debt and other financing facilities and funds generated from operations, are sufficient to meet anticipated capital requirements and service our indebtedness. The following table summarizes our cash flow activities for the periods indicated (in millions):

			Six Months Ended
Cash flow provided by (used in):			July 4, 2026						June 28, 2025						$ Change
Operating activities			$	387					$	325					$	62
Investing activities			(15)						(99)						84
Financing activities			(341)						(257)						(84)
Effect of exchange rates on cash balances			1						2						(1)
Net change in cash and cash equivalents			$	32					$	(29)					$	61
Cash flow provided by (used in):
Operating activities			$	387					$	325					$	62
Less: Purchases of property, plant and equipment			(26)						(37)						11
Free cash flow (Non-GAAP)(1)			$	361					$	288					$	73

(1)Free cash flow, a non-GAAP measure, is defined as Net cash provided by (used in) operating activities in a period minus purchases of property, plant and equipment (capital expenditures) made in that period.

2026 compared to 2025

The change in our cash and cash equivalents balance during the six months ended July 4, 2026 compared to the prior year was primarily due to the following:

•$62 million increase in net operating cash inflows primarily due to growth in the business and higher operating profitability, favorable timing of vendor payments, and lower incentive compensation payments in the current year, partially offset by unfavorable timing of customer collections.

•$84 million decrease in net investing cash outflows primarily due to the acquisition of Photoneo in the prior year.

•$84 million increase in net financing cash outflows primarily due to higher share repurchases, partially offset by net borrowings on our debt facilities.

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Company Debt

The following table shows the carrying value of the Company’s debt (in millions):

			July 4, 2026						December 31, 2025
Term Loan A			$	1,531					$	1,575
Senior Notes			500						500
Revolving Credit Facility			565						275
Receivables Financing Facility			180						161
Total debt			$	2,776					$	2,511
Less: Debt issuance costs			(7)						(8)
Less: Unamortized discounts			(1)						(2)
Less: Current portion of debt			(2,275)						(141)
Total long-term debt			$	493					$	2,361

In the first half of 2026, we increased our borrowings under the Revolving Credit and Receivables Financing Facilities to fund share repurchases.

As of July 4, 2026, our short-term debt obligations primarily consists of our Term Loan A and Revolving Credit Facility (collectively, the "Credit Facility"), both of which are scheduled to mature on May 25, 2027. We intend to refinance the Credit Facility in the second half of 2026. The ultimate timing, structure, and terms of any such transaction will remain subject to the macroeconomic environment and prevailing conditions in the debt capital markets at the time of execution. Until a refinancing is completed, we will continue to meet our current debt service obligations using cash on hand and cash generated from operating activities.

See Note 10, Long-Term Debt in the Notes to Consolidated Financial Statements for further details related to the Company’s debt instruments.

Share Repurchases

During the second quarter of 2026, the Company repurchased 1,173,993 shares of common stock for approximately $268 million. During the six months ended July 4, 2026, the Company has repurchased a total of 2,468,021 shares of common stock for $568 million.

Safe Harbor

Forward-looking statements contained in this filing are subject to the safe harbor created by the Private Securities Litigation Reform Act of 1995 and are highly dependent upon a variety of important factors, which could cause actual results to differ materially from those expressed or implied in such forward-looking statements. When used in this document and documents referenced, the words “anticipate,” “expect,” “believe,” “intend,” “estimate,” “will,” “plan,” “goal,” “target,” and “strategy” and similar expressions or future conditional verbs such as “may,” “will,” “should,” “would,” and “could” 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. Actual results may differ materially from those expressed or implied by forward-looking statements. Any forward-looking statements represent the Company’s views only as of the date of this report and should not be relied upon as representing the Company’s views as of any subsequent date. The forward-looking statements include, but are not limited to, the Company’s financial outlook for the full year of 2026. These forward-looking statements are based on current expectations, forecasts and assumptions, and are subject to the risks and uncertainties inherent in the Company’s industry, market conditions, general domestic and international economic conditions, and other factors. These factors include:

•Market acceptance of the Company’s products, services, and software solutions and competitors’ offerings and the potential effects of emerging technologies and changes in customer requirements,

•The effect of global market conditions, including in North America, Europe, Middle East, and Africa (“EMEA”), Latin America, and Asia-Pacific regions in which we do business,

•The impact of changes in foreign exchange rates, customs duties and trade policies due to the large percentage of our sales and operations being outside the U.S.,

•Our ability to effectively manage manufacturing and operating costs,

•Risks related to the manufacturing of the Company’s products and conducting business operations in non-U.S. countries, including the risk of depending on key suppliers who are also in non-U.S. countries,

•The Company’s ability to purchase sufficient materials, parts, and components, and our ability to provide services, software, and products to meet customer demand, particularly in light of global economic conditions,

•The availability of credit and the volatility of capital markets, which may affect our suppliers, customers, and ourselves,

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•Success of integrating acquisitions,

•Our ability to attract, retain, develop, and motivate key personnel,

•Interest rate and financial market conditions,

•Access to cash and cash equivalents held outside the U.S.,

•The effect of natural disasters, man-made disasters, public health issues (including pandemics), and cybersecurity incidents on our business, our customers or our contracted third parties,

•The impact of changes in foreign and domestic governmental policies, laws, or regulations,

•The outcome of litigation in which the Company may be involved, particularly litigation or claims related to infringement of third-party intellectual property rights, and

•The outcome of any future tax matters or tax law changes.

We encourage readers of this report to review Part II, Item 1A, “Risk Factors” in this report for further discussion of issues that could affect the Company’s future results. We undertake 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 report.

New Accounting Pronouncements

Recently Issued Accounting Pronouncements Not Yet Adopted

In November 2024, the FASB issued ASU No. 2024-03, Disaggregation of Income Statement Expenses, which requires disaggregated disclosure of certain categories of expenses that are included within expense captions presented on the Consolidated Statements of Operations on an annual and interim basis. This ASU will be effective for the Company’s fiscal December 31, 2027 year-end and interim periods thereafter, with early adoption permitted. We are assessing the impact of this guidance on our disclosures; it will not have an impact on our results of operations, cash flows, or financial condition.

In September 2025, the FASB issued ASU No. 2025-06, Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software, which amends the criteria for capitalizing internal-use software development costs. This ASU will be effective for the Company beginning in 2028, with early adoption permitted. While we are currently assessing the impact of this ASU, we do not expect it to have a significant impact to the Company’s consolidated financial statements.

Non-GAAP Measures

The Company has provided reconciliations of the supplemental non-GAAP financial measures, as defined under the rules of the Securities and Exchange Commission, presented herein to the most directly comparable financial measures calculated and presented in accordance with GAAP.

These supplemental non-GAAP financial measures – Consolidated Organic Net sales growth, CF Organic Net sales growth, AVA Organic Net sales growth, and Free cash flow – are presented because our management evaluates our financial results both including and excluding the effects of items that are not part of ongoing operations. Management believes that the supplemental non-GAAP financial measures presented provide additional perspective and insights when analyzing the core operating performance of our business from period to period and trends in our historical operating results. These supplemental non-GAAP financial measures should not be considered superior to, as a substitute for, or as an alternative to, and should be considered in conjunction with the GAAP financial measures presented.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

There were no material changes in the Company’s market risk during the six months ended July 4, 2026. For additional information on market risk, refer to Item 7A, “Quantitative and Qualitative Disclosures About Market Risk” in the Annual Report on Form 10-K for the year ended December 31, 2025.

Item 4. Controls and Procedures

Management’s Report on Disclosure Controls

Our management is responsible for establishing and maintaining adequate disclosure controls as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act to ensure that information required to be disclosed by the Company in reports that it files or submits under the Exchange Act is (i) recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission rules and forms and (ii) accumulated and communicated to the Company’s management,

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including its principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosure. Our management assessed the effectiveness of our disclosure controls as of July 4, 2026. Based on this assessment and those criteria, our management believes that, as of July 4, 2026, our disclosure controls were effective.

Changes in Internal Control over Financial Reporting

During the quarter ended July 4, 2026, there have been no changes in our internal controls that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Inherent Limitations on the Effectiveness of Controls

Our management, including our Chief Executive Officer and Chief Financial Officer, does not expect that our disclosure controls and procedures or our internal controls will prevent or detect all errors and all fraud. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Further, the design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that misstatements due to error or fraud will not occur or that all control issues and instances of fraud, if any, within Zebra have been prevented or detected. These inherent limitations include the realities that judgments in decision-making can be faulty and that breakdowns can occur because of simple error or mistake. Controls can also be circumvented by the individual acts of some persons, by collusion of two or more people, or by management override of the controls. The design of any system of controls is based in part on certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions. Projections of any evaluation of controls effectiveness to future periods are subject to risks. Over time, controls may become inadequate because of changes in conditions or deterioration in the degree of compliance with policies or procedures.

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PART II - OTHER INFORMATION 

Item 1. Legal Proceedings

See Note 12, Accrued Liabilities, Commitments and Contingencies in the Notes to Consolidated Financial Statements included in this report.

Item 1A. Risk Factors

In addition to the other information included in this report, you should carefully consider the factors discussed in Part I, Item 1A. “Risk Factors” in the Annual Report on Form 10-K for the year ended December 31, 2025, and the factors identified under “Safe Harbor” in Part I, Item 2 of this Quarterly Report on Form 10-Q, which could materially affect our business, financial condition, cash flows, or results of operations. The risks described in the Annual Report are not the only risks facing the Company. Additional risks and uncertainties not currently known to the Company or that the Company currently considers immaterial also may materially adversely affect its business, financial condition, and/or operating results. There have been no material changes to the risk factors included in our Annual Report for the year ended December 31, 2025.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

The following table sets forth information with respect to repurchases of the Company’s common stock for the three months ended July 4, 2026:

Period						Total Number of Shares Purchased						Average Price Paid per Share						Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (1)						Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs (in millions) (1)
April 5, 2026 - May 2, 2026						888,963						$	224.98					888,963						$	759
May 3, 2026 - May 30, 2026						82,095						249.01						82,095						739
May 31, 2026 - July 4, 2026						202,935						236.67						202,935						691
Total						1,173,993						$	228.68					1,173,993						$	691

(1)On February 4, 2026, the Company’s Board of Directors newly authorized share repurchases of up to $1 billion of outstanding shares of common stock, expanding upon the existing authorization that was in effect since 2022. Repurchases may be effected from time to time through open market purchases, including pursuant to a pre-set trading plan meeting the requirements of Rule 10b5-1(c) of the Securities Exchange Act of 1934.

Item 5. Other Information

The Company’s Securities Transactions and Confidentiality Policy governs the purchase, sale, and/or other dispositions of the Company's securities by directors, officers and employees, and is designed to promote compliance with insider trading laws, rules and regulations, and any listing standards applicable to the Company. None of our directors or executive officers had in effect, adopted or terminated a Rule 10b5-1 trading arrangement or non-Rule 10b5-1 trading arrangement (as defined in Item 408(c) of Regulation S-K) during the quarter ended July 4, 2026.

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Item 6. Exhibits

10.1			Form of 2026 performance-vested restricted stock unit agreement for employees (other than the CEO)
10.2			Form of 2026 performance-vested restricted stock unit with relative Total Shareholder Return modifier agreement for executives (including the CEO)
10.3			Form of 2026 time-vested restricted stock unit agreement for all employees (including the CEO)
31.1			Rule 13a-14(a)/15d-14(a) Certification of Principal Executive Officer
31.2			Rule 13a-14(a)/15d-14(a) Certification of Principal Financial Officer
32.1			Certification of Principal Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
32.2			Certification of Principal Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101			The following financial information from Zebra Technologies Corporation Quarterly Report on Form 10-Q, formatted in Inline XBRL: consolidated financial statements and accompanying notes in Part I, Item 1, “Consolidated Financial Statements” of this Quarterly Report on Form 10-Q. The instance document does not appear in the interactive data file because Inline XBRL tags are embedded in the iXBRL document.
104			The cover page from the Company’s Quarterly Report on Form 10-Q for the quarter ended July 4, 2026 formatted in Inline XBRL (included in Exhibit 101).

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

			ZEBRA TECHNOLOGIES CORPORATION
Date: August 4, 2026			By:						/s/ William J. Burns
									William J. Burns
									Chief Executive Officer
Date: August 4, 2026			By:						/s/ Nathan Winters
									Nathan Winters
									Chief Financial Officer

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