Abstract

Zebra Technologies Corporation will release its first-quarter 2026 results on May 12, 2026, Pre-Market; this preview consolidates the latest quarterly actuals and current-quarter forecasts, including revenue of 1.48 billion US dollars and adjusted EPS of 4.25, and frames the key drivers that investors are monitoring across execution, margins, and segment mix.

Market Forecast

Consensus for the current quarter points to revenue of 1.48 billion US dollars, up 14.72% year over year, adjusted EPS of 4.25, up 17.47% year over year, and EBIT of 287.03 million US dollars, up 15.94% year over year. Forecasts do not explicitly include a gross margin or net margin figure for the quarter. The main business is expected to remain anchored in device-led solutions with continued normalization of orders, while investors focus on price realization and cost offsets to sustain profitability. Services and Software stands out as the most promising mix enhancer; in the latest breakdown it contributed 0.98 billion US dollars and is central to recurring revenue expansion and lifecycle value capture.

Last Quarter Review

Zebra Technologies Corporation reported revenue of 1.46 billion US dollars, a gross profit margin of 47.32%, GAAP net profit attributable to shareholders of 70.00 million US dollars, a net profit margin of 4.75%, and adjusted EPS of 4.33, with year-over-year growth of 9.22% for revenue and 8.25% for adjusted EPS. On operating execution, EBIT reached 307.00 million US dollars, exceeding consensus by 13.62 million US dollars (4.64%). In the latest business mix disclosure, Tangible Products represented 4.42 billion US dollars (81.88%), while Services and Software delivered 0.98 billion US dollars (18.12%), underscoring a steady contribution from higher-margin services and software alongside hardware shipments.

Current Quarter Outlook (with major analytical insights)

Main business: Core device-led solutions and execution on pricing and cost

Zebra’s core shipments and solution deployments remain the backbone of quarterly performance, and the revenue cadence implied by the forecast reflects improving demand consistency across large enterprise accounts, along with disciplined pricing. A key watchpoint this quarter is the extent to which price increases implemented starting in March can neutralize higher component costs, particularly memory, which was flagged by the sell side as a headwind that management aims to offset through a combination of secured supply and pricing actions. The first derivative investors will parse on May 12, 2026 is whether the company can sustain the upper-40s gross margin profile seen last quarter while delivering double-digit revenue growth, even as backlog normalizes and product mix shifts within mobile computing, scanning, printing, and RFID portfolios. Another angle is the resilience of order quality. After periods of channel digestion in prior cycles, the combination of large program rollouts and steady run-rate demand is important to underpin the revenue base. The forecasted 14.72% year-over-year growth suggests a favorable comparison against the prior-year quarter, but the translation of revenue to EBIT will be scrutinized for leverage. Last quarter’s EBIT outperformance versus estimates provides a reference point; the current quarter’s 287.03 million US dollars EBIT estimate implies healthy operating execution, but any deviation in freight, components, and integration expenses could influence drop-through. Sequential dynamics around GAAP net income will also draw attention given last quarter’s sequential net profit contraction, making the sustainability of operating efficiencies a focal theme. Product refresh cycles and attach rates will matter for both revenue and gross margin. Units that carry higher attach of accessories, services, and maintenance can elevate blended margins and improve lifetime economics per device. A clean execution on lead times and fulfillment is particularly relevant late in the quarter, as large customers often finalize deployments into monthly checkpoints; meeting these schedules supports both revenue recognition and customer satisfaction metrics that can influence forward pipeline conversion.

Most promising business: Services and Software mix and recurring monetization

Services and Software remains a prominent opportunity for mix accretion and recurring monetization. In the latest breakdown, this segment contributed 0.98 billion US dollars and continues to benefit from device lifecycle services, support, workflow software, and analytics that extend value beyond initial hardware sales. The economics of multi-year service contracts and software subscriptions enhance revenue visibility and margin stability, which, if scaled, can help dampen volatility from hardware cycles. Recent partnership activity provides incremental context. The collaboration with Aiva Health to enable hands-free nurse workflows on Zebra healthcare devices adds a concrete use-case expansion path in a critical end-market, strengthening the argument for software and services pull-through following device deployments. In parallel, Zebra’s corporate venture investment in Apera AI underpins a strategy to selectively enhance automation software capabilities that can be embedded around machine vision and workflow orchestration use cases, creating optionality for solution-led growth. These initiatives align with a broader thesis that solutions and services can lift the margin structure and stickiness of enterprise relationships, allowing the company to harvest more value per installed device base over time. From a quarter-specific lens, the key variables for Services and Software include renewal rates on maintenance, deal sizes for new deployments that bundle software and support, and the degree to which software pilots mature into paid production at scale. While the forecast detail does not break out services growth explicitly, the overall EPS and EBIT growth forecasts suggest constructive operating contribution from the mix. Investors will also examine any commentary on software attach to recent deals, as that can serve as a leading indicator for sustained margin accretion into the second half of 2026.

Key stock price drivers this quarter: Margin trajectory, portfolio focus, and guidance quality

The first driver is margin trajectory. Last quarter’s 47.32% gross margin sets a reference point; investors will evaluate whether procurement, pricing, and mix dynamics can maintain or expand that level as double-digit revenue growth flows through. Component cost inflation, particularly in memory, is a live variable; however, management’s actions to secure supply and implement price increases beginning in March are intended to buffer gross margin. The balance between higher-cost inputs and realized pricing will likely be a central narrative on the call, and any quantification of tailwinds from services mix will be closely watched. The second driver is portfolio focus following the divestiture of the robotics automation business to Skild AI. By exiting a capital-intensive, non-core hardware area, Zebra can simplify operations, concentrate R&D and go-to-market on its core solution stack, and potentially improve cash conversion from reduced inventory and capex intensity in that line. Investors will be attentive to any near-term financial effects from the transaction, but strategically, the exit can reduce execution complexity and enable tighter alignment between data capture, mobile computing, machine vision, and software orchestration. This should improve the clarity of organic growth drivers in 2026 and sharpen accountability around returns on innovation. The third driver is guidance quality and cadence. The current-quarter consensus embeds 14.72% year-over-year revenue growth and 17.47% growth in adjusted EPS. For shares, the reaction will hinge on whether management’s outlook corroborates the acceleration implied by consensus and frames a path to sustained double-digit growth with margin stability. Update on order trends by customer type, commentary on regional demand, and detail on pricing carryover into subsequent quarters will determine whether expectations recalibrate up or down. Given last quarter’s EBIT outperformance versus estimates and a slight revenue miss, investors may place a premium on the quality of revenue and the consistency of margin delivery rather than headline beats alone.

Beyond these immediate drivers, there are several company-specific developments that can influence sentiment. The Aiva Health collaboration points to continued healthcare workflow innovation on the installed device base, which could enhance platform value. The Apera AI investment highlights measured expansion into AI-enabled automation software around machine vision and orchestration. Together, these initiatives indicate a disciplined approach to extending the software and services layer without diluting focus on core execution. Finally, operating expense control and working capital discipline will matter for free cash flow quality; while not explicitly forecast in the dataset, how management discusses cost containment and inventory turns can shape the second-half 2026 narrative.

Another area worth attention is the interplay of seasonal patterns with channel normalization. If channel inventory has largely realigned with sell-through, the quarter’s growth should reflect healthier end-demand rather than wholesale channel refills. That can support better forward visibility and more balanced booking-to-bill ratios. Any color on replenishment cycles in large retail and logistics programs will help investors gauge whether the current forecast is underpinned by durable, programmatic spend or concentrated, project-driven peaks. Similarly, clarity on services renewal cycles and the maturation of software pilots into paid deployments will help the market assess how much of the EPS expansion is secured by recurring revenue versus dependent on quarterly product timing.

Finally, attention will turn to the durability of the 2026 acceleration story described by several analysts. A consistent theme in recent commentary is the company’s plan to offset input cost headwinds with price measures and supply actions, while using portfolio focus to improve execution speed. This quarter’s report and guide are a checkpoint on that trajectory: whether the company can sustain revenue momentum, hold or expand margins, and show tangible benefits from portfolio streamlining will likely drive the stock’s next leg.

Analyst Opinions

The balance of recent published views skews bullish over bearish, with multiple Buy/Outperform ratings and upwardly revised price targets, and no explicit Sell calls in the surveyed period. On our count, six bullish opinions outweighed zero bearish opinions, with the remainder Neutral/Hold.

Barclays’ Guy Hardwick reiterated Buy ratings during the period with price targets cited at 330.00, 351.00, and 368.00 US dollars at different points, emphasizing a constructive setup around execution and an improving growth profile into 2026. The repeated Buy stance underscores confidence that revenue normalization and mix benefits can support both top-line expansion and profit resilience. From a modeling perspective, Barclays’ commentary aligns with the current-quarter consensus that calls for 14.72% year-over-year revenue growth and 15.94% year-over-year EBIT growth, suggesting operating leverage from steady gross margins and disciplined operating expenses.

Baird maintained an Outperform rating with a 300.00 US dollars price target, framing the story as one where execution on core programs and a healthier pipeline set up a recovery path. While Baird’s target sits below some of the more optimistic estimates, the stance supports the idea that current valuation can be underpinned by improving earnings power as growth reaccelerates and margins stabilize. The key to Baird’s constructive view is that incremental revenue from core deployments, coupled with services and software attachment, can expand earnings without requiring extraordinary macro assistance.

Wolfe Research kept an Outperform rating with a 281.00 US dollars target, signaling confidence in near-term operational delivery despite component cost noise. Wolfe’s framework focuses on monitoring gross margin sustainability and the cadence of orders in higher-value deployments. This view places weight on the company’s pricing actions and supply-chain management to protect profitability and does not require outsized upside on revenue to support the thesis, provided operating execution remains consistent.

Northcoast Research maintained a Buy rating and adjusted its target to 344.00 US dollars, reflecting conviction that the company’s reacceleration path in 2026 is intact. This perspective highlights the benefits of portfolio focus after the sale of robotics automation assets, as well as the potential for services and software to contribute a more favorable mix. Northcoast’s constructive angle dovetails with consensus forecasts for double-digit revenue and EPS growth this quarter, framing a runway for improving operating metrics through the year.

Across these bullish takes, several shared elements emerge. First, current-quarter expectations for revenue of 1.48 billion US dollars and EPS of 4.25 are seen as achievable within a framework of disciplined pricing and secured supply, even as input costs fluctuate. Second, the Services and Software contribution is viewed as a mix lever that can support gross margin and smooth the earnings profile, particularly as healthcare and other targeted workflows deepen with partners such as Aiva Health. Third, the portfolio focus following the divestiture to Skild AI is interpreted as a positive step to streamline operations and concentrate capital allocation on solution areas with stronger returns and clearer synergies with the core installed base. Lastly, the buy-side will be attuned to how management frames the second half of 2026; if guidance confirms continued growth and margin steadiness, the bullish camp expects estimates to remain supported and potentially drift higher.

In summary, the majority institutional view heading into May 12, 2026 is favorable. With consensus baking in mid-teens year-over-year growth on both revenue and EBIT and high-teens growth on adjusted EPS, the bar is constructive but not unreasonably high if the company executes on pricing, cost control, and mix. Positive confirmation on gross margin durability, clarity on the services and software trajectory, and consistent guidance could sustain the bullish narrative and keep attention on the 2026 acceleration path.