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What changed in Zebra Technologies's 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of Zebra Technologies's 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+237 added−228 removedSource: 10-K (2026-02-12) vs 10-K (2025-02-13)

Top changes in Zebra Technologies's 2025 10-K

237 paragraphs added · 228 removed · 182 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

58 edited+20 added−13 removed42 unchanged
Biggest change(“Matrox”) for $881 million in cash, net of Matrox’s cash on-hand. Matrox is a leading provider of advanced machine vision components and software serving multiple end-markets. Through its acquisition, the Company expanded its machine vision products and software offerings. The operating results of Matrox are included in the EVM segment.
Biggest changeThrough its acquisition, the Company expanded its portfolio of self-service and consumer-facing workflow offerings. The operating results of Elo are included in the CF segment. Photoneo : On February 28, 2025, the Company acquired Photoneo for $62 million in cash, net of Photoneo’s cash on-hand. Photoneo is a leading developer and manufacturer of 3D machine vision offerings.
We also foster a highly specialized ecosystem of location and tracking partners who complement our offerings and help integrate them into our joint customers’ operations. Supplies: We produce and sell stock and customized thermal labels, wristbands, receipts, ribbons, plastic cards, and RFID tags suitable for use with our printers, as well as wristbands for use in laser printers.
We also foster a highly specialized ecosystem of location and tracking partners who complement our offerings and help integrate them into our joint customers’ operations. Supplies and Sensors: We produce and sell stock and customized thermal labels, wristbands, receipts, ribbons, plastic cards, and RFID tags suitable for use with our printers, as well as wristbands for use in laser printers.
This includes increased focus on market segments and geographies that offer share-gain opportunities. In addition, we plan to leverage our market-leading installed base to accelerate growth in attach-oriented offerings, including services, supplies, accessories, and software applications. Our global channel partner network is vital to helping us achieve these goals.
This includes increased focus on market segments and geographies that offer share-gain opportunities. In addition, we plan to leverage our market-leading installed base to accelerate growth in attach-oriented offerings, including services, supplies and sensors, accessories, and software applications. Our global channel partner network is vital to helping us achieve these goals.
Marketing: Our marketing function aligns closely with sales, customer success and product management to promote our offerings that address the needs of our customers. Marketing is responsible for leading strategic cross-functional practices which benefit the broader organization including pricing, enterprise analytics, customer experience, market sizing, brand strategy and channel strategy.
Marketing: Our marketing function aligns closely with sales, customer success and product management to promote our offerings to address the needs of our customers. Marketing is responsible for leading strategic cross-functional practices which benefit the broader organization including pricing, enterprise analytics, customer experience, market sizing, brand strategy and channel strategy.
We believe this increases Zebra’s innovation. We believe that our strong Company culture is a key contributor to our success. Following the refresh of Zebra’s values (Lead through Innovation; Deliver Excellence with Agility; Think and Act Customer First; Succeed as One; and Make a Positive Impact) in 2023, we launched our culture reinvigoration campaign in 2024.
We believe that our strong Company culture is a key contributor to our success. Following the refresh of Zebra’s values (Lead through Innovation; Deliver Excellence with Agility; Think and Act Customer First; Succeed as One; and Make a Positive Impact) in 2023, we launched our culture reinvigoration campaign in 2024.
Over 25% of our employees are members of at least one ERG. We continue to expand membership across the business. Community Engagement and Philanthropy We have established partnerships with local organizations to forge meaningful relationships within the communities where Zebra operates and have closely tied our outreach strategy with our work in these communities.
Over 25% of our employees are members of at least one ERG. We continue to expand membership across the business. Community Engagement and Philanthropy We have established partnerships with external organizations to forge meaningful relationships within the communities where Zebra operates and have closely tied our outreach strategy with our work in these communities.
Other Regulatory Matters Some of our operations use substances regulated under various federal, state, local, and international laws governing the environment and worker health and safety, including those governing the discharge of pollutants into the ground, air and water, the management and disposal of hazardous substances and wastes and the cleanup of contaminated sites.
Other Regulatory Matters Some of our operations use substances regulated under various federal, state, local, and international laws governing the environment and worker health and safety, including those governing the discharge of pollutants into the ground, air and water, the management and disposal of hazardous substances and waste and the cleanup of contaminated sites.
The well-being of Zebra’s employees remains a core focus, and we have benefits reflecting this commitment, including zDay, (a paid, Company-wide day off for all eligible Zebra employees), summer hours, and Focus Fridays (which encourage meeting-free time on Friday afternoons). 10 Table of Contents Talent Development Zebra is committed to creating an environment that fosters continuous learning.
The well-being of Zebra’s employees remains a core focus, and we have benefits reflecting this commitment, including zDay, (a paid, Company-wide day off for all eligible Zebra employees), summer hours, and Focus Fridays (which encourage meeting-free time on Friday afternoons). Talent Development Zebra is committed to creating an environment that fosters continuous learning.
We manufacture and market products to be used in spectrum bands already made available by regulatory bodies, these include voice and data infrastructure, mobile radios, and portable or hand-held devices. Consequently, our results of operations could be positively or negatively affected by the rules and regulations adopted from time-to-time by the FCC, NTIA, or regulatory agencies in other countries.
We manufacture and market products to be used in spectrum bands already made available by regulatory bodies, including voice and data infrastructure, mobile radios, and portable or hand-held devices. Consequently, our results of operations could be positively or negatively affected by the rules and regulations adopted from time-to-time by the FCC, NTIA, or regulatory agencies in other countries.
Worldwide, we have employed approximately 2,750 engineers and innovation and design experts, who along with contractors, are focused on strengthening and broadening our extensive portfolio of offerings.
Worldwide, we have employed approximately 2,790 engineers and innovation and design experts, who, along with contractors, are focused on strengthening and broadening our extensive portfolio of offerings.
The need for companies to improve productivity and implement their strategies, as well as the secular trends around IoT, cloud computing, automation, and mobility, are some of the factors that are creating growth opportunities for established and new competitors.
The need for companies to improve productivity and implement their strategies, as well as the secular trends around artificial intelligence, cloud computing, automation, and mobility, are some of the factors that are creating growth opportunities for established and new competitors.
We also focus on waste reduction, circular economy product innovation with certified refurbished devices, eco-packaging and sustainable product design. Additionally, we have science-based targets for carbon emission reductions in Zebra’s operations and throughout our value chain. Competition We operate in a highly competitive environment.
We also focus on waste reduction, circular economy product innovation with certified refurbished devices, eco-packaging and sustainable product design. Additionally, we have science-based targets for carbon emission reductions in Zebra’s operations and throughout our value chain. 8 Table of Contents Competition We operate in a highly competitive environment.
Competitors include: Avery Dennison, Entrust, Honeywell, Sato, Toshiba TEC, and TSC. 8 Table of Contents Data Capture, Fixed Industrial Scanning, and Machine Vision : Competitors that provide a broad portfolio of barcode scanning products and related services that are suitable for most global market applications include Datalogic and Honeywell.
Competitors include: Avery Dennison, Entrust, Honeywell, Sato, Toshiba TEC, and TSC. Data Capture, Fixed Industrial Scanning, and Machine Vision : Competitors that provide a broad portfolio of barcode scanning products and related services that are suitable for most global market applications include Datalogic, Honeywell and Newland.
Our Competitive Strengths The following are core competitive strengths that we believe enable us to differentiate ourselves from our competitors: An industry leader focused on improving enterprise workflows on the frontline We are focused on the key complementary technology offerings that drive improved enterprise workflows on the frontline, including mobile computing, barcode and card printing, data capture, RFID, fixed industrial scanning, machine vision, and workflow optimization solutions, along with related software, services, and accessories.
Our Competitive Strengths The following are core competitive strengths that we believe enable us to differentiate ourselves from our competitors: An industry leader focused on digitizing and automating operations, and improving enterprise workflows on the frontline We are focused on the key complementary technology offerings that automate operations and drive improved enterprise workflows on the frontline, including mobile computing, self-service touchscreens, barcode and card printing, data capture, RFID, fixed industrial scanning, machine vision, and workflow optimization solutions, along with related software, services, and accessories.
We also provide machine vision and robotics automation solutions; a full range of services, including maintenance, technical support, repair, 4 Table of Contents 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, public sector, and other industries.
We also provide 4 Table of Contents 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.
Our Net sales to significant customers as a percentage of the Company’s total Net sales were approximately: Year Ended December 31, 2024 2023 2022 Customer A 21 % 18 % 21 % Customer B 19 % 14 % 15 % Customer C 14 % 12 % 13 % Sales and Marketing Sales: We sell our offerings primarily through distributors (two-tier distribution), value added resellers (“VARs”), independent software vendors (“ISVs”), direct marketers, and OEMs, and our software offerings primarily through our direct sales force.
Our Net sales to significant customers as a percentage of the Company’s total Net sales were approximately: Year Ended December 31, 2025 2025 2024 2023 Customer A 29 % 21 % 18 % Customer B 15 % 19 % 14 % Customer C 15 % 14 % 12 % 9 Table of Contents Sales and Marketing Sales: We sell our offerings primarily through distributors (two-tier distribution), value added resellers (“VARs”), independent software vendors (“ISVs”), direct marketers, and OEMs, and our software offerings primarily through our direct sales force.
Research and Development The Company devotes significant resources to developing innovative offerings for our target markets and ensuring that our offerings maintain high levels of reliability and provide value to end-users. Research and development expenditures for the years ended 2024, 2023 and 2022 were $563 million, $519 million and $570 million, or 11.3%, 11.3% and 9.9% of Net sales, respectively.
Research and Development The Company devotes significant resources to developing innovative offerings for our target markets and ensuring that our offerings maintain high levels of reliability and provide value to end-users. Research and development expenditures for the years ended 2025, 2024 and 2023 were $593 million, $563 million and $519 million, or 11.0%, 11.3% and 11.3% of Net sales, respectively.
The information on our website is not, and shall not be deemed to be, a part of this Annual Report on Form 10-K or incorporated into any other filings we make with the Securities and Exchange Commission (“SEC”).
Available Information Our website address is www.zebra.com. The information on our website is not, and shall not be deemed to be, a part of this Annual Report on Form 10-K or incorporated into any other filings we make with the Securities and Exchange Commission (“SEC”).
Although we do not rely only on patents or other intellectual property rights to protect or establish our market position, we will enforce our intellectual property rights when and where appropriate. Human Capital As of December 31, 2024, the Company had approximately 9,900 employees globally, with a majority in sales and technical roles.
Although we do not rely only on patents or other intellectual property rights to protect or establish our market position, we will enforce our intellectual property rights when and where appropriate. 10 Table of Contents Human Capital As of December 31, 2025, the Company had approximately 10,700 employees globally, with a majority in sales and technical roles.
Intellectual Property We rely on a combination of trade secrets, patents, trademarks, copyrights, and contractual rights to establish and protect our innovations, and hold a large portfolio of intellectual property rights in the U.S. and other countries. As of December 31, 2024, the Company owned approximately 1,700 trademark registrations and trademark applications, and approximately 7,150 patents and patent applications, worldwide.
Intellectual Property We rely on a combination of trade secrets, patents, trademarks, copyrights, and contractual rights to establish and protect our innovations, and hold a large portfolio of intellectual property rights in the U.S. and other countries. As of December 31, 2025, the Company owned approximately 1,850 trademark registrations and trademark applications, and approximately 8,000 patents and patent applications, worldwide.
New employees complete our Foundations course where they learn about Zebra, our vision, purpose, culture, and available resources, all taught through hands-on experiences and interactive presentations. Employees who are new to leading people can complete our Leadership Essentials and our Inclusive Leadership courses, which are designed to foster their leadership and management skills.
New employees complete our Foundations course where they learn about Zebra, our vision, purpose, culture, values, and available resources, all taught through hands-on experiences and interactive presentations. Employees who are new to leading people can complete our Leadership Essentials, Coaching Your Team and Mastering Development Conversations courses, which are designed to foster their leadership and management skills.
The campaign’s action-based workshop, experienced virtually or in person, provides employees an opportunity to learn and share experiences relating to the importance of Zebra’s culture and values. Employee engagement within the Company is consistently high and measures above relevant benchmarks for technology companies.
The campaign’s action-based workshop, experienced virtually or in-person, provides employees with an opportunity to learn and share experiences relating to the importance of Zebra’s culture and values. As of the end of 2025, more than 90% of global employees have attended the workshop. Employee engagement within the Company is consistently high and measures above relevant benchmarks for technology companies.
Furthermore, as recognition of the Company’s strong culture and commitment to its employees, Zebra was ranked #78 on Newsweek’s list of Global Most Loved Workplaces, and #51 on Fast Company’s list of the Best Workplaces for Innovators.
Furthermore, as recognition of the Company’s strong culture and commitment to its employees, Zebra continued to be ranked on Newsweek’s list of Global Most Loved Workplaces and on Fast Company’s list of the Best Workplaces for Innovators in 2025.
Highly diversified business mix We are highly diversified across business segments, end markets, geographies, and customers. Additionally, we have strong recurring business in services, supplies, and software driven by an extensive global installed base of purpose-built offerings. Global reach and brand We sell to customers directly and through our network of channel partners around the world.
Additionally, we have strong recurring business in services, supplies and sensors, and software driven by an extensive global installed base of purpose-built offerings. Global reach and brand We sell to customers directly and through our network of channel partners around the world.
Enterprise Visibility & Mobility Mobile Computing: We design, manufacture, and sell rugged and enterprise-grade mobile computing products and accessories in a variety of specialized form factors and designs to meet a wide array of enterprise applications.
Principal product categories within the Connected Frontline segment include: Mobile Computing: We design, manufacture, and sell rugged and enterprise-grade mobile computing products and accessories in a variety of specialized form factors and designs to meet a wide array of enterprise applications.
Our products often incorporate barcode scanning, global position system and RFID features, and other sensory capabilities. Additionally, specialized features, such as advanced data capture technologies, data analytics technologies, voice and video collaboration tools, and advanced battery technologies, enable our customers to work more efficiently and better serve their own customers.
Additionally, specialized features, such as advanced data capture technologies, data analytics technologies, voice and video collaboration tools, and advanced battery technologies, enable our customers to work more efficiently and better serve their own customers.
These characteristics enable us to compete successfully, achieve economies of scale, and develop industry-leading offerings. 7 Table of Contents Our Business Strategies Leverage our market leadership position and innovation to profitably grow our core business We expect to drive revenue growth by continuing to outpace our competition in our core businesses, including mobile computing, data capture, thermal barcode printing, and services.
Our Business Strategies Leverage our market leadership position and innovation to profitably grow our core business We expect to drive revenue growth by continuing to outpace our competition in our core businesses, including mobile computing, data capture, thermal barcode printing, and services.
Our software-based offerings are available with multiple service levels, and are often contracted through multi-year service agreements; • Managed service offerings comprised of software and hardware bundled together, which include a range of physical inventory management offerings for retail, including offerings for full store physical inventories, cycle counts, and analytics; and • Robotic automation offerings, which include software-powered autonomous robots that enable customers to orchestrate workflows alongside frontline workers, improving productivity and operational efficiency.
Our software-based offerings are available with multiple service levels, often contracted through multi-year service agreements. We also provide managed service offerings comprised of software and hardware bundled together, which include a range of physical inventory management offerings for retail, including offerings for full store physical inventories, cycle counts, and analytics.
Our fixed industrial scanning products automatically track and trace items that move from production through distribution. Our industrial machine vision platform-independent software, software development kits, smart cameras, vision controllers, frame grabbers, input/output cards, and 3D sensors capture, inspect, assess, and record data from industrial vision systems in factory automation, semiconductor inspection, pharmaceutical packaging, food & beverage, among other use cases.
Our industrial machine vision platform-independent AI-enabled software, software development kits, smart cameras, vision controllers, frame grabbers, input/output cards, and 3D sensors capture, inspect, assess, and record data from industrial vision systems in factory automation, semiconductor inspection, pharmaceutical packaging, food & beverage, among other use cases. We also provide related software and accessories for these offerings.
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 and first responders addressing public safety and emergency situations. Data from enterprise assets, including status, condition, location, utilization, and preferences, is analyzed in the cloud to provide prioritized actionable insights.
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.
This commitment directly shapes our approach to fostering a culture of belonging and advances employee engagement. It is Zebra’s policy to provide equal employment opportunity to all applications and employees. Our vision is to leverage the workforce where employees can bring their best selves to work, and to be a workspace where all employees are seen, heard, valued and respected.
It is Zebra’s policy to provide equal employment opportunities to all applicants and employees. Our vision is to leverage the workforce where employees can bring their best selves to work, and to be a workspace where all employees are seen, heard, valued and respected. We believe this increases Zebra’s innovation.
We offer a wide range of accessories and options for our printers, including carrying cases, vehicle mounts and battery chargers. 5 Table of Contents RFID and RTLS Offerings: We provide a range of hardware and software options for capturing location data to satisfy a large variety of requirements for range, accuracy, and precision.
RFID and RTLS Offerings: We provide a range of hardware and software options for capturing location data to satisfy a large variety of requirements for range, accuracy, and precision.
In addition, certain products are manufactured in accordance with procurement regulations and various international trade agreements and remain eligible for sale to the U.S. government. Production facilities for our supplies products are located in the U.S. and Europe. We also supplement our in-house supplies production capabilities with third-party manufacturers, principally located in Asia-Pacific.
Production facilities for our supplies and sensors products are located in the U.S., Mexico, and Europe. We also supplement our in-house supplies and sensors production capabilities with third-party manufacturers, principally located in Asia-Pacific.
During 2024, compliance with U.S. federal, state and local, and foreign laws regulating the discharge of materials into the environment, or otherwise relating to the protection of the environment did not have a material effect on our business or results of operations. 11 Table of Contents Available Information Our website address is www.zebra.com.
Certain products are subject to various federal, state, local, and international laws governing chemical substances in electronic offerings. During 2025, compliance with U.S. federal, state and local, and foreign laws regulating the discharge of materials into the environment or otherwise relating to the protection of the environment did not have a material effect on our business or results of operations.
Our mobile computing products primarily incorporate the Android™ operating system with software extensions for the enterprise and support local-area and wide-area voice and data communications. Our products include software tools and services that enable secure data transmission while also supporting application development, device configuration, and field support to facilitate seamless, rapid deployment and maximum customer return on investment.
Our products include software tools and services that enable secure data transmission while also supporting application development, device configuration, and field support to facilitate seamless, rapid deployment and maximum customer return on investment. Our products often incorporate barcode scanning, global position system and RFID features, and other sensory capabilities.
We provide our services directly and through our global network of partners. 6 Table of Contents Workflow optimization solutions: We provide a portfolio of offerings that help our customers improve the agility and productivity of key workflows by analyzing and acting on operational data in real-time.
Workflow optimization solutions : We provide a portfolio of offerings that help our customers improve the agility and productivity of key workflows by analyzing and acting on operational data in real-time. Our primary focus is on frontline workers in Zebra’s end markets, including retail, transportation and logistics, manufacturing, and healthcare.
Commitment to innovation and deep industry-specific expertise Over time, we have developed and delivered improved, targeted end-to-end offerings for our customers. We remain committed to leveraging our technology portfolio and expertise in the industries that we service to continue to develop innovative offerings that meet the key needs of our customers.
Commitment to innovation and deep industry-specific expertise Over time, we have developed and delivered improved, targeted end-to-end offerings for our customers.
We operate in 114 facilities with approximately 9,900 employees worldwide. We provide our offerings globally through a direct sales force and an extensive network of over 10,000 channel partners, operating in approximately 176 countries. We continue to advance our Enterprise Asset Intelligence (“EAI”) vision: every asset and front-line worker visible, connected, and fully optimized.
We operate in 129 facilities with approximately 10,700 employees worldwide. We provide our offerings globally through a direct sales force and an extensive network of over 10,000 channel partners, operating in 179 countries. We continue to evolve and advance our vision: frontline operations everywhere are digitized, automated and intelligent.
We also compete against smaller companies that focus on limited product subsets or specific regions, including Newland. Competitors in our fixed industrial scanning and machine vision business include Cognex, Keyence, and SICK. Mobile Computing : Competitors in mobile computing and related services include companies that have historically served enterprises with ruggedized devices.
Competitors in our fixed industrial scanning and machine vision business include Cognex, Keyence, and SICK. Mobile Computing : Competitors in mobile computing and related services include companies that have historically served enterprises with ruggedized devices. For some applications, we compete with companies that provide tablets and smart phones. Competitors include: Datalogic, Honeywell, Panasonic and Urovo.
From a more traditional sense, the marketing organization is also comprised of regional marketing teams that interface closely with customers, partners, and sellers; plus teams that support external communications, offering marketing, digital marketing, marketing operations, and business intelligence functions. 9 Table of Contents Manufacturing and Outsourcing Final assembly of our hardware products is performed by third parties, including electronics manufacturing services companies (“EMSs”) and joint design manufacturers (“JDMs”).
From a more traditional sense, the marketing organization is also comprised of regional marketing teams that interface closely with customers, partners, and sellers; as well as teams that support external communications, offering marketing, digital marketing, marketing operations, and business intelligence functions.
These offerings are typically delivered through cloud-based software subscriptions and leverage big data, artificial intelligence, and mobile and web applications to provide customers with real-time visibility and actionable insights about their business. By analyzing labor, inventory, transactional and real-time situational data, these offerings are able to forecast demand, prescribe actions, schedule workers, and enhance collaboration.
Our workflow optimization solutions include software-based offerings, which include workforce management, workflow execution and task management, communication and collaboration-based offerings, demand-sensing, price optimization, and prescriptive analytics. These offerings are typically delivered through cloud-based software subscriptions and leverage big data, artificial intelligence, and mobile and web applications to provide customers with real-time visibility and actionable insights about their business.
Supplies : The supplies industry is highly fragmented with competition comprised of numerous companies of various sizes around the world. Workflow optimization solutions: We compete with a diverse and varied group of companies across our offerings worldwide.
Supplies and Sensors : The supplies industry is highly fragmented with competition comprised of numerous companies of various sizes around the world. Workflow optimization solutions: Competitors include software providers to the retail industry. Customers End-users of our offerings are diversified across a wide variety of industries.
Our presence gives us the capability to serve our customers globally. In addition, we maintain strong brand recognition with a positive reputation in the industry as a trusted and strategic partner known for delivering high quality offerings that are reliable and durable.
In addition, we maintain strong brand recognition with a positive reputation in the industry as a trusted and strategic partner known for delivering high quality offerings that are reliable and durable. Scale advantages We believe the size and scope of our operations, including market leadership, offering development investment, portfolio breadth, and global distribution, give us advantages over our competitors.
The IoT enables the real-time exchange of an increasingly broad set of information among a proliferation of smart, connected devices. The continued rapid growth of mobile computing devices and application software is also significantly expanding use cases throughout enterprises and supply chains. With these expanded capabilities, end-users can consume and act upon dynamic enterprise data and information anytime and anywhere.
This transformation is powered by the proliferation of smart, connected devices that exchange an increasingly broad set of information in real time, enabling intelligent and responsive physical environments. The continued rapid growth of mobile computing devices and application software is also significantly expanding use cases throughout enterprises and supply chains.
These resources include the Zebra Education Network, an online learning platform available to all employees offering a wide variety of learning content that employees can connect to their individual development plans. We also offer annual training and certification programs, including mandatory compliance training. We also have structured mentorship programs for our employees.
These resources include the Zebra Education Network, an online learning platform available to all employees offering a wide variety of learning content that employees can connect to their individual development plans. In 2025, Zebra also launched a new annual global learning series entitled “Development Days...Learn, Grow, Succeed,” which focused on in-person and virtual learning for all employees globally.
Data Capture, Fixed Industrial Scanning, and Machine Vision: We design, manufacture, and sell barcode scanners, industrial machine vision cameras, and fixed industrial scanners. Our portfolio of scanners includes laser scanning and imager products in a variety of form factors, including fixed, handheld, and embedded original equipment manufacturer (“OEM”) modules.
Our portfolio of scanners includes laser scanning and imager products in a variety of form factors, including fixed, handheld, and embedded original equipment manufacturer (“OEM”) modules. Our scanners incorporate a range of technologies including area imagers, linear imagers, and lasers, as well as read linear and two-dimensional barcodes.
The manufacturers generally purchase all the components and subassemblies used in the production of our products. Our products are shipped to regional distribution centers, operated by third-party logistics providers or the Company. A portion of products are reconfigured at the distribution centers through firmware downloads, packaging, and customer specific customization before they are shipped to customers.
We maintain control over portions of the supply chain, including supplier selection and price negotiations for key components. The manufacturers generally purchase all the components and subassemblies used in the production of our products. Our products are shipped to regional distribution centers, operated by third-party logistics providers or the Company.
As a result, our offerings enable enterprises to “sense, analyze, and act” more effectively to optimize their activities. The need to transform workflows is being driven by secular trends in technology, which include the internet of things ( “IoT” ), cloud-based data analytics, automation, mobility, computer vision, as well as artificial intelligence and machine learning.
Data from enterprise assets, including status, condition, location, utilization, and preferences, is analyzed in the cloud to provide prioritized actionable insights and optimize activities. The need to transform workflows is being driven by secular trends in technology, which include the creation of digital twins, cloud-based data analytics, automation, mobility, computer vision, artificial intelligence and machine learning.
We also provide related software and accessories for these offerings. Services: We provide a full range of maintenance, technical support, and repair services. We also provide managed and professional services that, among other things, help customers design, test, and deploy our offerings as well as manage their mobility devices, software applications and workflows.
Our professional and managed services are designed to help customers design, test, and deploy our offerings, as well as manage their mobility devices, software applications, and workflows. These services include the configuration and staging of products, design, testing, and deployment support, as well as the management of mobility devices, software applications, and workflows.
Our products are currently produced in facilities primarily located in the Asia-Pacific region, including China, Taiwan, Vietnam, Malaysia, and Mexico. The EMSs and JDMs produce our products to our design specifications. We maintain control over portions of the supply chain, including supplier selection and price negotiations for key components.
Manufacturing and Outsourcing Final assembly of our hardware products is performed by third parties, including electronics manufacturing services companies (“EMSs”) and joint design manufacturers (“JDMs”). Our products are produced in facilities primarily located in the Asia-Pacific region (China, Malaysia, Vietnam, and Taiwan) and Mexico. The EMSs and JDMs produce our products to our design specifications.
Our employees work in 54 countries with 45% of our employee population residing in the U.S. Some locations where business is conducted, primarily in Europe, China, and India, are subject to labor laws that differ significantly from those in the U.S. The Company is committed to attracting, developing, and retaining talent to enable our strategic vision and purpose.
Our employees work in 57 countries with 44% of our employee population residing in the U.S. The Company is committed to attracting, developing, and retaining talent to enable our strategic vision and purpose. This commitment directly shapes our approach to fostering a culture of belonging and advances employee engagement.
Our offerings include cloud-based subscriptions with multiple service levels, which are typically contracted through multi-year service agreements.
Services: We provide a comprehensive range of professional, managed, and maintenance services to support our customers throughout the entire product lifecycle. Our offerings include cloud-based subscriptions with multiple service levels, typically contracted through multi-year service agreements.
Scale advantages We believe the size and scope of our operations, including market leadership, offering development investment, portfolio breadth, and global distribution, give us advantages over our competitors. We believe we have the largest installed base of offerings compared to other companies in our industry.
We believe we have the largest installed base of offerings compared to other companies in our industry. These characteristics enable us to compete successfully, achieve economies of scale, and develop industry-leading offerings.
Leveraging artificial intelligence through machine learning can analyze real-time data for increased visibility into workflows. Additionally, computer and machine vision technology, which enables the automatic extraction and understanding of useful information from a digital image or video, provides a key element in many of our offerings. Acquisitions Matrox: On June 3, 2022, the Company acquired Matrox Electronic Systems Ltd.
Leveraging a combination of on-device and cloud-based AI, smart context-aware software companions are beginning to augment worker productivity, providing real-time assistance to get work done more quickly and accurately. Additionally, computer and machine vision technology, which enables the automatic extraction and understanding of useful information from a digital image or video, provides a key element in many of our offerings.
We plan to continue investing in the development of technologies that serve as the foundation for intelligent operations, providing our customers with visibility, connected frontline workers, and intelligent automation. Our offerings will also increasingly include advanced features, functions, and user experiences to drive additional competitive differentiation and elevate our role as a solutions provider.
As the foundation for intelligent operations, we empower our customers to optimize workflows, enhance decision-making, and improve business outcomes in an increasingly dynamic environment. We will continue to invest in technologies that connect the frontline, provide real-time visibility, and enable automation, which we believe will drive our competitive differentiation and elevate our position as a solutions provider.
As such, we will ensure that we provide the necessary value and support for our partners to be successful. Advance our Enterprise Asset Intelligence vision Our EAI vision is for every asset and front-line worker to be connected, visible, and fully optimized.
As such, we will ensure that we provide the necessary value and support for our partners to be successful. Advance our vision Our vision is for frontline operations everywhere to be digitized, automated, and intelligent. We believe that key technology trends, including digital twins, cloud computing, and artificial intelligence, are fundamentally transforming our customers' businesses and our industry.
The design of these offerings reflects the diverse needs of these markets, with different ergonomics, multiple communication protocols, and varying levels of ruggedness. In 2021 we introduced fixed industrial scanning and machine vision offerings, and in 2022, we significantly expanded our machine vision offerings through the acquisition of Matrox Imaging.
They are used in a broad range of applications, ranging from supermarket checkouts to optimization in warehouses to patient management in hospitals. The design of these offerings reflects the diverse needs of these markets, with different ergonomics, multiple communication protocols, and varying levels of ruggedness.
We believe that the offerings across these segments collectively elevate Zebra’s positioning with our customers, enabling us to better transform workflows. Asset Intelligence & Tracking Barcode and Card Printing: We design, manufacture, and sell printers, which produce high-quality labels, wristbands, tickets, receipts, and plastic cards on demand.
Asset Visibility and Automation The Asset Visibility and Automation 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: Barcode and Card Printing: We design, manufacture, and sell printers, which produce high-quality labels, wristbands, tickets, receipts, and plastic cards on demand.
Removed
Photoneo : On December 27, 2024, the Company entered into a definitive agreement to acquire Photoneo, a leading developer and manufacturer of 3D machine vision solutions. The purchase price of approximately €60 million is expected to be funded with cash on hand.
Added
With these expanded capabilities, end-users can consume and act upon dynamic enterprise data and information anytime and anywhere. Additionally, artificial intelligence is further streamlining frontline workflows by providing insights and delivering actions using on-device vision, audio, location and RFID to automate parts of traditional workflows.
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The transaction is subject to customary closing conditions and is expected to close in the first quarter of 2025. The acquired business will become part of the EVM segment. See Note 5, Business Acquisitions in the Notes to Consolidated Financial Statements for additional details.
Added
Operations and Technologies In the fourth quarter of 2025, the Company’s reportable segments changed to Connected Frontline (“CF”) and Asset Visibility and Automation (“AVA”). The CF segment consists of our mobile computing products, and related services and software-based offerings that were formerly part of our Enterprise Visibility & Mobility (“EVM”) segment.
Removed
Operations and Technologies Our operations consist of two reportable segments: Asset Intelligence & Tracking (“AIT”), which includes barcode and card printing, RFID and RTLS offerings, supplies, and services; and Enterprise Visibility & Mobility (“EVM”), which includes mobile computing, data capture, fixed industrial scanning and machine vision, services and workflow optimization solutions.
Added
The AVA segment consists of our barcode and card printing products and related supplies and sensors, RFID and RTLS offerings, and related services that collectively represented our former Asset Intelligence & Tracking (“AIT”) segment, as well as our data capture, and machine vision offerings and related services that were formerly part of our EVM segment.
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Our scanners incorporate a range of technologies including area imagers, linear imagers, and lasers, as well as read linear and two-dimensional barcodes. They are used in a broad range of applications, ranging from supermarket checkouts to industrial warehouse optimization to patient management in hospitals.
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This change aligns with how we are operating our business to advance our strategy. Acquisitions Elo: On September 30, 2025, the Company acquired Elo Holdings, Inc. (“Elo”) for $1,303 million in cash, net of Elo’s cash on-hand. Elo is an innovator of solutions that engage customers, enhance self-service, and accelerate automation across a wide range of end markets.
Removed
Our primary focus is on frontline workers in Zebra’s end markets, including retail, transportation and logistics, manufacturing, and healthcare. Our workflow optimization solutions include: • Software-based offerings, which include workforce management, workflow execution and task management, demand-sensing, price optimization, and prescriptive analytics, as well as communication and collaboration-based offerings.
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Through its acquisition, the Company expanded its machine vision offerings across several industries. The operating results of Photoneo are included in the AVA segment. See Note 5, Business Acquisitions in the Notes to Consolidated Financial Statements for additional details. Connected Frontline The Connected Frontline segment is focused on unifying teams, customers, and AI agents to deliver enhanced frontline experiences.
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Our robotic automation offerings are available in a variety of form factors to accommodate many use cases, from e-commerce fulfillment to material movement.
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This segment brings together solutions that empower frontline workers with the information and tools they need to make smarter decisions and improve customer service.
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We believe that secular technology trends, particularly in IoT, cloud computing, automation, mobility, and artificial intelligence advance our vision and are transforming our customers’ businesses and our industry, providing us with significant new opportunities to create value for our customers and for the Company.
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Our mobile computing products primarily incorporate the Android™ operating system with 5 Table of Contents software extensions for the enterprise and support local-area and wide-area voice and data communications.
Removed
We expect to capitalize on these trends, and in particular the proliferation of smart connected sensors and devices in our core market segments, by providing end-to-end offerings that integrate these sensors and devices with cloud-based software which add value to our customers’ workflows and analytics.
Added
Elo: Recently acquired leader in technology solutions for customer-facing frontline workflows that modernize point-of-sale, streamline self-service & payment experiences, automate kitchen/industrial workflows, and optimize production and process management. Our offerings include a wide range of industry tailored solutions including point-of-sale solutions, self-serve kiosks and interactive touchscreen displays.
Removed
For some applications, we compete with companies that provide tablets and smart phones. Competitors include: Datalogic, Honeywell, Panasonic, and Urovo. RFID and RTLS Offerings : We compete with numerous companies operating in this market including Chainway, Impinj, Invengo, JADAK, Rodinbell, and Ubisense.
Added
By analyzing labor, inventory, transactional and real-time situational data, these offerings are able to forecast demand, prescribe actions, schedule workers, and enhance collaboration. We are leveraging artificial intelligence to automate the detailed generation of tasks within complex workflows, bring knowledge and product companions to workers and deliver conversational interfaces that power our overall frontline experience.
Removed
Competitors range from providers of software-based offerings serving customers in the retail industry to providers of autonomous mobile robot offerings serving customers in the manufacturing, distribution, and fulfillment industries. Customers End-users of our offerings are diversified across a wide variety of industries.
Added
Our maintenance and support services include a full suite of maintenance, technical support, and repair services to ensure our products continue to operate at peak performance. These services include ongoing maintenance and updates, technical support and repair and recycling services. Our services are available directly from us or through our global network of partners.
Removed
Our employees actively participate in volunteering activities and are supported through our Zebra Gives programs. Through Zebra’s community partnerships, our employees leverage their talents and experience to make a positive impact on important community causes, including the advancement of STEM education.
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We offer a wide range of accessories and options for our printers, including carrying cases, vehicle mounts and battery chargers. 6 Table of Contents Data Capture, Fixed Industrial Scanning, and Machine Vision : We design, manufacture, and sell barcode scanners, fixed industrial scanners, and industrial machine vision cameras.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeOur subcontractors may not be able to acquire or maintain the quality of the materials, components, subsystems, and services they supply, or secure preferred warranty and indemnity coverage from their suppliers, which might result in greater product returns, service problems, warranty claims and costs, and regulatory compliance issues and could harm our business, financial condition, and results of operations. 18 Table of Contents We have outsourced portions of certain business operations such as repair, distribution, engineering services, and information technology services and may outsource additional business operations, which limits our control over these business operations and exposes us to additional risk as a result of the actions of our outsource partners.
Biggest changeOur subcontractors may not be able to acquire or maintain the quality of the materials, components, subsystems, and services they supply, or secure preferred warranty and indemnity coverage from their suppliers, which might result in greater product returns, service problems, warranty claims and costs, and regulatory compliance issues and could harm our business, financial condition, and results of operations.
Acquisitions also may involve a number of risks, including, but not limited to: • Difficulties and uncertainties in retaining the customers, distributors, vendors, or other business relationships from the acquired entities; • The loss of key employees of acquired entities; • Disruptions in our business due to difficulties integrating and reorganizing operations, offerings, technologies and personnel; • The ability of acquired entities to fulfill their customers’ obligations; • The inheritance of known, and the discovery of unknown, issues or liabilities; • Pre-closing and post-closing acquisition-related earnings charges could adversely impact operating results and cash flows in any given period, and the impact may be substantially different from period to period; • The failure of acquired entities to meet or exceed expected operating results or cash flows could result in impairment of goodwill or intangible assets acquired; 13 Table of Contents • The ability to implement internal controls and accounting systems necessary to be compliant with requirements applicable to public companies subject to SEC reporting, which could result in misstated financial reports; and • Future acquisitions could result in changes such as potentially dilutive issuances of equity securities and the incurrence of debt and contingent liabilities.
Acquisitions also may involve a number of risks, including, but not limited to: • Difficulties and uncertainties in retaining the customers, distributors, vendors, or other business relationships from the acquired entities; • The loss of key employees of acquired entities; • Disruptions in our business due to difficulties integrating and reorganizing operations, offerings, systems, networks, supply chains, technologies and personnel; • The ability of acquired entities to fulfill their customers’ obligations; • The inheritance of known, and the discovery of unknown, issues or liabilities; • Pre-closing and post-closing acquisition-related earnings charges could adversely impact operating results and cash flows in any given period, and the impact may be substantially different from period to period; • The failure of acquired entities to meet or exceed expected operating results or cash flows could result in impairment of goodwill or intangible assets acquired; • The ability to implement internal controls and accounting systems necessary to be compliant with requirements applicable to public companies subject to SEC reporting, which could result in misstated financial reports; and • Future acquisitions could result in changes such as potentially dilutive issuances of equity securities and the incurrence of debt and contingent liabilities.
Moreover, in the event any of these suppliers breach their contracts with us, our legal remedies associated with such a breach may be insufficient to compensate us for any damages it may suffer. Our order backlog may not be a reliable indicator of our future operating results.
Moreover, in the event any of these suppliers breach their contracts with us, our legal remedies associated with such a breach may be insufficient to compensate us for any damages we may suffer. Our order backlog may not be a reliable indicator of our future operating results.
To remain competitive, we believe we must continue to effectively and economically: • Identify and evolve with customer needs, emerging technologies, and industry trends; • Monitor disruptive technologies and business models; • Innovate, develop and timely commercialize new technologies and offerings; • Competitively price our offerings; • Offer superior customer service; • Provide offerings of high quality and reliability; • Provide dependable and efficient distribution networks; and • Attract, retain and develop employees with technical expertise and an understanding of our industry and customer needs.
To remain competitive, we believe we must continue to effectively and economically: • Identify and evolve with customer needs, emerging technologies, and industry trends; • Monitor disruptive technologies and business models; • Innovate, develop and timely commercialize new technologies and offerings; 14 Table of Contents • Competitively price our offerings; • Offer superior customer service; • Provide offerings of high quality and reliability; • Provide dependable and efficient distribution networks; and • Attract, retain and develop employees with technical expertise and an understanding of our industry and customer needs.
We have been subject to product liability claims, and may continue to be subject to such claims, including claims for property or economic damages or personal injury, where damages arose, and may continue to arise, from our products as a result of actual or apparent design or manufacturing defects.
We have been and may continue to be subject to product liability claims, including for property or economic damages or personal injury, where damages arose from our products as a result of actual or apparent design or manufacturing defects.
Phishing and other types of attempts to obtain unauthorized information or access are often sophisticated and difficult to detect or defeat. 16 Table of Contents Cybersecurity incidents can take a variety of forms including unintentional events as well as deliberate attacks by individuals, groups and sophisticated organizations, such as state sponsored organizations or nation-state actors.
Phishing and other types of attempts to obtain unauthorized information or access are often sophisticated and difficult to detect or defeat. Cybersecurity incidents can take a variety of forms including unintentional events as well as deliberate attacks by individuals, groups and sophisticated organizations, such as state sponsored organizations or nation-state actors.
We are not able to exercise direct control over the assembly or related operations of certain of our products. If these third-party manufacturers experience business difficulties or fail to meet our manufacturing needs, then we may be unable to satisfy customer demand, lose sales, and be unable to maintain customer relationships.
We are not able to exercise direct control over the assembly or related operations of certain of our products. If these electronics manufacturers experience business difficulties or fail to meet our manufacturing needs, then we may be unable to satisfy customer demand, lose sales, and be unable to maintain customer relationships.
Although we have not suffered significant harm from any errors, defects, or bugs, we may discover significant errors, defects, or bugs in the future that we may not be able to correct or correct in a timely manner.
Although we have not suffered significant harm from any defects, errors, or bugs in our offerings, we may discover significant defects, errors, or bugs in the future that we may not be able to correct or to correct in a timely manner.
We periodically perform vulnerability assessments, remediate vulnerabilities, review log/access, perform system maintenance, manage network perimeter protection, implement and manage disaster recovery testing, and provide periodic educational sessions to our employees to foster awareness of schemes to access sensitive information.
We periodically perform vulnerability assessments, remediate vulnerabilities, review log/access, perform system maintenance, manage network perimeter protection, implement and manage disaster recovery testing, and 16 Table of Contents provide periodic educational sessions to our employees to foster awareness of schemes to access sensitive information.
Without such third parties continuing to manufacture our products, we may have no other means of final assembly of certain of our products until we are able to secure the manufacturing capability at another facility or develop an alternative manufacturing facility. This transition could be costly and time consuming.
Without such electronics manufacturers continuing to manufacture our products, we may have no other means of final assembly of certain of our products until we are able to secure the manufacturing capability at another facility or develop an alternative manufacturing facility. This transition could be costly and time consuming.
Furthermore, efforts to enforce or protect our proprietary rights may be ineffective and could result in the invalidation or narrowing of the scope of our intellectual property and may cause us to incur substantial 15 Table of Contents litigation costs.
Furthermore, efforts to enforce or protect our proprietary rights may be ineffective and could result in the invalidation or narrowing of the scope of our intellectual property and may cause us to incur substantial litigation costs.
Geopolitical turmoil and uncertainty could have a negative impact on our ability to sell and ship our offerings, collect payments from and support customers in certain regions, and could increase the costs, risks and adverse impacts from supply chain and 14 Table of Contents logistics challenges.
Geopolitical turmoil and uncertainty could have a negative impact on our ability to sell and ship our offerings, collect payments from and support customers in certain regions, and could increase the costs, risks and adverse impacts from supply chain and logistics challenges.
A failure by such manufacturers to provide manufacturing services to us as we require, or any disruption in such manufacturing services up to and including a catastrophic shut-down, may adversely affect our business results. Because we rely on these third-party electronics manufacturers to manufacture our products, we may incur increased business continuity risks.
A failure by such electronics manufacturers to provide manufacturing services to us as we require, or any disruption in such manufacturing services up to and including a catastrophic shut-down, may adversely affect our business results. Because we rely on these electronics manufacturers to manufacture certain of our hardware products, we may incur increased business continuity risks.
We are not always successful in passing along customer requirements to our subcontractors, and thus in some cases may be required to absorb contractual risks from our customers without corresponding back-to-back coverage from our subcontractors.
We are not always successful in passing along customer requirements to our subcontractors, and thus in some 18 Table of Contents cases may be required to absorb contractual risks from our customers without corresponding back-to-back coverage from our subcontractors.
Inability to consummate future acquisitions at appropriate prices could negatively impact our growth rate and stock price. Our ability to expand revenues, earnings, and cash flow depends in part upon our ability to identify and successfully acquire and integrate businesses at appropriate prices and to realize anticipated synergies.
Inability to consummate future acquisitions at appropriate prices could negatively impact our growth rate and stock price. Our ability to expand revenues, earnings, and cash flow may be affected in part by our ability to identify and successfully acquire and integrate businesses at appropriate prices and to realize anticipated synergies.
Although we strive to be an employer of choice, we may not be able to continue to successfully attract, retain, develop, or motivate key personnel in the future. Any disruption in the services of key personnel may have a material adverse effect on our business and results of operations.
Although we strive to be an employer of choice, we may not be able to continue to successfully attract, retain, develop, or motivate key personnel in the future. Any disruption in the services of key personnel, including those resulting from succession planning challenges, may have a material adverse effect on our business and results of operations.
If credit pressures or other financial difficulties result in insolvency for third-party dealers, distributors, or resellers and we are unable to successfully transition end-customers to purchase our offerings from other third-parties or from us directly, it may cause, and in some cases, has caused, a negative impact on our financial results.
If credit pressures or other financial difficulties result in insolvency for channel partners and we are unable to successfully transition end-customers to purchase our offerings from other channel partners or from us directly, it may cause, and in some cases has caused, a negative impact on our financial results.
Third-party dealers, distributors or resellers could also face additional costs or credit concerns resulting from an uncertain economic environment that would cause such parties to reduce purchases of our offerings, thereby causing a negative impact on our financial results.
Our channel partners could also face additional costs or credit concerns resulting from an uncertain economic environment that would cause such parties to reduce purchases of our offerings, thereby causing a negative impact on our financial results.
Final assembly of certain of our products is performed by third-party electronics manufacturers. We may be dependent on these third-party electronics manufacturers as a sole-source of supply for the manufacture of such products.
Final assembly of certain of our hardware products is performed by third party electronics manufacturers, including EMSs and JDMs. We may be dependent on such electronics manufacturers as a sole-source of supply for the manufacture of such products.
Some of these third-parties are smaller and more likely to be impacted by a significant decrease in available credit that could result from a weakness in the financial markets.
Some of our channel partners are smaller and more likely to be impacted by a significant decrease in available credit that could result from a weakness in the financial markets.
In addition, we note that certain ESG matters are becoming less “voluntary” as regulators, including the SEC, begin proposing and adopting regulations regarding ESG matters, including, but not limited to climate change-related matters. As we are subject to increased regulatory requirements, we could experience increased compliance-related costs and risks, including potential enforcement and litigation.
In addition, certain ESG matters are becoming less “voluntary” as regulators propose and adopt regulations regarding ESG matters, including, but not limited to climate change-related matters. As we are subject to increased regulatory requirements, we could experience increased compliance-related costs and risks, including potential enforcement and litigation.
Identification, assessment, and disclosure of such matters is complex. Many of the statements in such voluntary disclosures are based on our expectations and assumptions, which may require substantial discretion and forecasts about costs and future circumstances.
From time to time, we create and publish voluntary disclosures regarding ESG matters. Identification, assessment, and disclosure of such matters is complex. Many of the statements in such voluntary disclosures are based on our expectations and assumptions, which may require substantial discretion and forecasts about costs and future circumstances.
Any changes to our channel program may cause some of our third-party dealers, distributors, or resellers to exit the program due to modifications to the program structure, which may reduce our ability to bring offerings to market and could have a negative impact on our results of operations.
Changes to our channel program may cause some of our channel partners to exit the program due to modifications to the program structure, which may reduce our ability to bring offerings to market and could have a negative impact on our results of operations.
An inability to compete successfully could have an adverse effect on our business and results of operations. Geopolitical turmoil, including regional conflicts, terrorism and war could result in market instability, which could negatively impact our business results. We are a global company with international operations, and we sell our offerings in countries throughout the world.
Geopolitical turmoil, including regional conflicts, terrorism and war could result in market instability, which could negatively impact our business results. We are a global company with international operations, and we sell our offerings in countries throughout the world.
Despite these precautions, third parties may be able to copy or reproduce aspects of our intellectual property and our offerings or, without authorization, to misappropriate and use information we regard as trade secrets.
We use copyrights, patents, trademarks, trade secrets, confidentiality provisions and contracts to protect these proprietary rights. Despite these precautions, third parties may be able to copy or reproduce aspects of our intellectual property and our offerings or, without authorization, to misappropriate and use information we regard as trade secrets.
If one of our suppliers or subcontractors fails to procure necessary license rights to trademarks, copyrights, or patents, legal action could be taken against us that could impact the salability of the Company’s offerings, and expose us to financial obligations to a third party. Any of these events could have a negative impact on our sales and results of operations.
If one of our suppliers or subcontractors fails to procure necessary license rights to trademarks, copyrights, or patents, legal action could be taken against the Company that could impact the salability of our offerings, and expose us to financial obligations to a third party.
The Company may not be able to continue to develop offerings to address user needs effectively. To be successful, we must adapt to rapidly changing technological and application needs by continually improving our offerings, as well as introducing new offerings to address user demands.
To be successful, we must adapt to rapidly changing technological and application needs by continually improving our offerings, as well as introducing new offerings to address user demands.
If one of our suppliers, subcontractors, distributors, resellers, or TPSRs violates labor or other laws or implements labor or other business practices that are regarded as unethical, the shipment of finished products to us could be interrupted, orders could be canceled, relationships could be terminated, and our reputation could be damaged.
If one of these parties violates labor or other laws, or implements labor or other business practices that are regarded as unethical, negligent, or reckless, operations could be disrupted, the shipment of finished products to us could be interrupted, orders could be canceled, relationships could be terminated, and our reputation could be damaged.
We source some of our components from sole-source suppliers. 19 Table of Contents Any disruption to our suppliers or significant increase in the price of supplies, inclusive of transportation costs, or change in customer demand could have a negative impact on our results of operations.
Any disruption to our suppliers or significant increase in the price of supplies, inclusive of transportation costs, or change in customer demand could have a negative impact on our results of operations.
Failure of one or more of our third-party dealers, distributors, or resellers to effectively promote our offerings could affect our ability to bring offerings to market and have a negative impact on our results of operations.
Failure of one or more of these channel partners to effectively promote our offerings could affect our ability to bring offerings to market and have a negative impact on our results of operations.
The following factors could present difficulties to us: • Managing our distribution channel partners and end-user customers; • Managing our contract manufacturing and supply chain; • Manufacturing an increased number of products; • Developing and managing custom offerings; • Managing parties to whom we have outsourced portions of our business operations; • Managing administrative and operational burdens; • Managing stakeholder interests including customer, investor and employee social responsibility matters; • Maintaining and improving information technology infrastructure to support growth and to manage cybersecurity threats; • Managing the integration of acquisitions; • Managing logistical problems common to complex, expansive operations; • Managing our international operations; • Managing the cost of labor including any union organizing efforts and our responses to such efforts; and • Attracting, developing and retaining individuals with the requisite technical expertise to develop new technologies and introduce new offerings.
The following factors could present difficulties to us: • Managing our distribution channel partners and end-user customers; • Managing our contract manufacturing and supply chain; • Manufacturing an increased number of products; • Developing and managing custom offerings; • Managing parties to whom we have outsourced portions of our business operations; • Managing administrative and operational burdens; • Managing stakeholder interests including customer, investor and employee social responsibility matters; • Maintaining and improving information technology infrastructure to support growth and to manage cybersecurity threats; • Managing the integration of acquisitions; • Managing logistical challenges common to complex, expansive international operations; • Managing impacts of government shutdowns or disruptions, including any adverse effects due to limited government funding and services, such as import and export clearance, regulatory approvals or visa processing; • Managing our organizational structure and workforce challenges, and ensuring a cohesive company culture among our employees; • Managing the cost of labor including any union organizing efforts and our responses to such efforts; and • Attracting, developing and retaining individuals with the requisite technical expertise to develop new technologies and introduce new offerings.
Our business success depends on our ability to attract, retain, develop and motivate key personnel. Our business and results of operations could be adversely affected by increased competition for highly skilled employees, higher employee turnover, or 17 Table of Contents increased compensation and benefit costs.
Any of these events may have a material adverse effect on our financial results. Our business success depends on our ability to attract, retain, develop and motivate key personnel. Our business and results of operations could be adversely affected by increased competition for highly skilled employees, higher employee turnover, or increased compensation and benefit costs.
The consequences of a natural and man-made disaster, or a widespread public health issue, could have a material impact on our global operations, our employees, our customers and our vendors, which could adversely impact our business results, operations, revenue, growth and overall financial condition. We are exposed to risks under large, multi-year contracts that may negatively impact our business.
The consequences of a natural and man-made disaster, or a widespread public health issue, could have a material impact on our global operations, our employees, our customers and our vendors, which could adversely impact our business results, operations, revenue, growth and overall financial condition.
ESG requirements and other increased regulation of climate change concerns could subject us to additional costs and restrictions and require us to make certain changes to our manufacturing practices and/or product designs, which could negatively impact our business, results of operations, financial condition and competitive position. From time to time, we create and publish voluntary disclosures regarding ESG matters.
Environmental, Social, and Governance (“ESG”) requirements and other increased regulation of climate change concerns could subject us to additional costs and restrictions and require us to make certain changes to our manufacturing practices and/or product designs, which could negatively impact our business, results of operations, financial condition and competitive position.
Recovery of front-loaded costs incurred on long-term managed services and software-based offerings contracts with customers is dependent on the continued viability of such customers. The insolvency of customers could result in a loss of anticipated future revenue attributable to that program or offering, which could have an adverse impact on our profitability.
Furthermore, the recovery of front-loaded costs incurred on long-term managed services and software-based offerings contracts is dependent on the continued viability of our customers. The insolvency of a customer could result in collectability risk of outstanding trade receivables, and/or a loss of anticipated future revenue attributable to that program or offering.
We also expect to continue the use of third-party contract manufacturing services with non-U.S. production and assembly operations for our offerings.
Shipments to non-U.S. customers are expected to continue to account for a material portion of Net sales. We also expect to continue the use of third-party contract manufacturing services with non-U.S. production and assembly operations for our offerings.
In addition, a significant increase in inflation rates could have an adverse impact on the profitability of longer-term contracts. We utilize the services of subcontractors to perform under many of our contracts, and the inability of our subcontractors to perform in a timely and compliant manner could negatively impact our performance obligations as the prime contractor.
Such contracts’ financial, technological, and cybersecurity risks could have an adverse impact on the Company’s profitability and financial results. We utilize the services of subcontractors to perform under many of our contracts, and the inability of our subcontractors to perform in a timely and compliant manner could negatively impact our performance obligations as the prime contractor.
See Item 3, Legal Proceedings for additional information regarding current patent litigation. The inability to protect intellectual property could harm our reputation, and our competitive position may be materially damaged. Our intellectual property is valuable and provides us with certain competitive advantages. We use copyrights, patents, trademarks, trade secrets, confidentiality provisions and contracts to protect these proprietary rights.
See Item 3, Legal Proceedings for additional information regarding current patent litigation. 15 Table of Contents The inability to protect intellectual property could harm our reputation, and our competitive position may be materially damaged. Our intellectual property is valuable and provides us with certain competitive advantages.
We rely on third-party dealers, distributors, and resellers to sell many of our offerings, and their failure to effectively bring our offerings to market may negatively affect our results of operations and financial results.
We rely on our channel partner network to sell many of our offerings, and failure of channel partners to effectively bring our offerings to market may negatively affect our results of operations and financial results.
It is our policy to require suppliers, subcontractors, distributors, resellers, and third-party sales representatives (“TPSRs”) to operate in compliance with applicable laws, rules, and regulations, including those regarding working conditions, employment practices, environmental compliance, anti-corruption, and trademark and copyright licensing. However, we do not control their labor and other business practices.
We require our suppliers, subcontractors, outsource partners, channel partners, and electronics manufacturers to operate in compliance with applicable laws, rules, and regulations, including those regarding working conditions, employment practices, environmental compliance, anti-corruption, and trademark and copyright licensing. However, we do not control these parties’ labor and other business practices.
In addition, we are exposed to the financial viability of our outsource partners. Once a business activity is outsourced, we may be contractually prohibited from, or may not practically be able to, bring such activity back within the Company or move it to another outsource partner.
Once a business activity is outsourced, we may be contractually prohibited from, or may not practically be able to, bring such activity back within the Company or move it to another outsource partner. Further, from time-to-time we have, and in certain instances will continue to, transition our outsourced operations to new outsource partners and/or to different geographies.
In addition to our own sales force, we provide our offerings through a variety of third-party dealers, distributors, and resellers who may also market other offerings that compete with ours.
In addition to our own sales force, we provide our offerings through our global channel partner network of distributors, VARs, ISVs, direct marketers, and OEMs who may also market other offerings that compete with ours.
Operational Risks The Company has substantial operations and sells a significant portion of our offerings outside of the U.S. and purchases important components, including final offerings, from suppliers located outside the U.S., many of whom with operations concentrated in China. Shipments to non-U.S. customers are expected to continue to account for a material portion of Net sales.
An inability to compete successfully could have an adverse effect on our business and results of operations. Operational Risks The Company has substantial operations and sells a significant portion of our offerings outside of the U.S. and purchases important components, including final offerings, from suppliers located outside the U.S., many of whom with operations concentrated in China.
Acquisitions can be difficult to identify and consummate due to competition among prospective buyers and the need to satisfy applicable closing conditions and obtain antitrust and other regulatory approval on acceptable terms. Macroeconomic factors, such as rising inflation and interest rates, capital market volatility, etc., could negatively influence our future acquisition opportunities.
Acquisitions can be difficult to identify and consummate due to competition among prospective buyers and the need to satisfy applicable closing conditions and obtain antitrust and other regulatory approval on acceptable terms.
To date, we have had no material incidents related to the security of our offerings. Additionally, strategic customers may negotiate specific controls and we may incur additional costs to comply with such customer-specific controls. We may incur liabilities as a result of product failures due to actual or apparent design or manufacturing defects.
To date, we have had no material incidents related to the security of our offerings. Additionally, strategic customers may negotiate specific controls and we may incur additional costs to comply with such customer-specific controls. Defects, errors, or bugs in our offerings, or in third-party components or software included in our offerings, could result in liability, reputational harm, and significant costs.
In some cases, our outsource partners’ actions may result in our being found to be in violation of laws or regulations, such as import or export regulations. As many of our outsource partners operate outside of the U.S., our outsourcing activity exposes us to information security vulnerabilities and increases our global risks.
In some cases, our outsource partners’ actions may result in our being found to be in violation of laws or regulations, such as import or export regulations.
The process of integrating any acquired business, technology, product, service, software, or solution into our operations or offerings may result in unforeseen operating difficulties and expenditures. Integration of an acquired company also may consume considerable management time and attention, which could otherwise be available for ongoing operations and the further development of our existing business.
Integration of an acquired company also may consume considerable management time and attention, which could otherwise be available for ongoing operations and the further development of our existing business. These and other factors may result in benefits of an acquisition not being fully realized.
Any future errors, defects, or bugs found in our offerings or servers and infrastructure may result in delays in, or loss of market acceptance of, our offerings; inability to deliver our offerings; diversion of resources; injury to reputation; increased service and warranty expenses; and payment of damages; which could have a material adverse effect on our financial results.
However, given the growing size of our installed base and the number of applications in which our offerings are used, any future actual or alleged design or manufacturing defects, errors, or bugs may result in: product recalls; delays in, or loss of market acceptance of, our offerings; inability to deliver our offerings; diversion of resources; injury to our reputation; increased service, warranty, and legal costs; and payment of damages.
We have taken actions to diversify, and may take additional actions to diversify in the future, our product sourcing footprint. Such actions have, and may again, result in additional costs. Our future operating results depend on our ability to purchase a sufficient amount of materials, parts, and components, as well as services and software to meet the demands of customers.
Any of these events could have a negative impact on our sales and results of operations. 19 Table of Contents Our future operating results depend on our ability to purchase a sufficient amount of materials, parts, and components, as well as services and software to meet the demands of customers. We source some of our components from sole-source suppliers.
The Company could encounter difficulties in any acquisition it undertakes, including unanticipated integration problems and business disruption. Acquisitions could also dilute stockholder value and adversely affect operating results. An acquisition may present business issues which are new to us.
Macroeconomic factors, such as rising inflation and interest rates, capital market volatility, etc., could negatively influence our future acquisition opportunities. 13 Table of Contents The Company could encounter difficulties in any acquisition it undertakes, including unanticipated integration problems and business disruption. Acquisitions could also dilute stockholder value and adversely affect operating results.
Because many of these contracts involve new technologies and applications and require the Company to engage subcontractors and can last multiple years, unforeseen events, such as technological difficulties, fluctuations in the price of raw materials, problems with our subcontractors or suppliers, and other cost overruns, can result in the contract pricing becoming less favorable or even unprofitable to us and have an adverse impact on our financial results.
These events, which include technological difficulties, fluctuations in the price of raw materials, challenges with our subcontractors or suppliers, and significant increases in inflation, may cause cost overruns and result in such contracts becoming less favorable or even unprofitable.
We enter into fixed-price contracts that could subject us to losses in the event we fail to properly estimate our costs. If our initial cost estimates are incorrect, we can lose money on these contracts.
Large, multi-year, and fixed-price contracts may expose the Company to risks that could lead to losses and adversely affect our business. We enter into large, multi-year contracts with our customers, some of which are on a fixed-price basis, that could subject us to financial risks if we fail to properly estimate our costs.
Defects or errors in the Company’s software offerings, or third-party software included in or upon which our offerings rely, could harm our reputation, result in significant cost to us, and impair our ability to market such offerings. Our software, third-party software included in our offerings, or servers and infrastructure may contain undetected errors, defects, or bugs.
Our products may contain actual or apparent design or manufacturing defects, not only in our own designed products but also in components of our products provided by third-party suppliers. Our software, third-party software included in our offerings, or servers and infrastructure upon which our offerings rely may contain undetected defects, errors, or bugs.
In addition, such design or manufacturing defects may occur not only in our own designed offerings, but also in components provided by third-party suppliers. We seek to limit such risk through insurance protection as well as product design, manufacturing quality control processes, product testing and contractual indemnification from suppliers.
We seek to limit these risks through insurance protection, product design, manufacturing quality control 17 Table of Contents processes, product testing, and contractual indemnification from suppliers.
We enter into large, multi-year contracts with our customers that expose us to risks, including among others: (i) technological risks, especially when contracts involve new technology; (ii) financial risks, including the accuracy of estimates inherent in projecting costs associated with large, long-term contracts and the related impact on operating results; and (iii) cybersecurity risks, especially in offerings or managed services contracts with customers that process personal data.
In addition to risks related to cost estimation, these contracts may expose the Company to other challenges including technological risks, when contracts involve new technology, and cybersecurity risks, especially in offerings or managed services contracts that process personal data.
Failure of our suppliers, subcontractors, distributors, resellers, and representatives to use acceptable legal or ethical business practices could negatively impact our business.
We have taken actions to diversify, and may take additional actions to diversify in the future, our product sourcing footprint. Such actions have resulted and may again result in additional costs. Failure of our suppliers, subcontractors, outsource partners, channel partners, and electronics manufacturers to use acceptable legal or ethical business practices could negatively impact our business.
Removed
These and other factors may result in benefits of an acquisition not being fully realized.
Added
An acquisition may present business issues which are new to us. The process of integrating any acquired business, technology, product, service, software, or solution into our operations or offerings may result in unforeseen operating difficulties and expenditures.
Removed
Further, certain of our third-party vendors have limited access to our employee and customer data and may use this data in unauthorized ways.
Added
On September 30, 2025, the Company acquired Elo Holdings, Inc. (“Elo”) for a purchase price of approximately $1.3 billion, a transaction that is significant in size, representing approximately 9% of the Company’s market capitalization on such date.
Removed
Although there have been no material claims to-date at the Company, due to the growing size of the Company’s installed offering base and growing number of applications in which our offerings can be used, an actual or alleged design or manufacturing defect could result in product recalls, injury to our reputation, and customer service costs or legal costs that could have material adverse effects on our financial results.
Added
This acquisition substantially increased the Company’s goodwill and other intangible assets, which could become impaired and result in material non-cash charges if we fail to achieve the expected operating results and cash flows.
Removed
The actions of our outsource partners could result in reputational damage to us and could negatively impact our financial results. Further, we have from time-to-time, and in certain instances will continue to, transition our outsourced operations to new service providers and/or to different geographies.
Added
The Company may not be able to successfully integrate Elo's business operations and personnel and to realize the anticipated growth opportunities and cost synergies, and the integration process may divert management's attention from other business priorities.
Added
Failure to successfully manage these and other risks associated with this acquisition, including those outlined above, may have a material adverse effect on our business and operating results. The Company may not be able to continue to develop offerings to address user needs effectively.
Added
We rely on third-party vendors for certain services, which may require them to access our employee and/or customer data. While our Third-Party Risk Management (TPRM) program is designed to assess and mitigate these risks, a failure of such a vendor's security controls could lead to unauthorized data access or misuse.
Added
Because many of these contracts involve new technologies and applications, require us to engage subcontractors, and span multiple years, our initial cost estimates are subject to unforeseen events.
Added
We have outsourced portions of certain business operations, such as repair, distribution, engineering services, and information technology services and may outsource additional business operations, which limits our control over these business operations and exposes us to additional risk as a result of the actions of our outsource partners.
Added
As many of our outsource partners operate outside of the U.S., our outsourcing activity exposes us to information security vulnerabilities and increases our global risks. In addition, we are exposed to the financial viability of our outsource partners.

Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeFurther, Zebra relies on its information security management system supported by a comprehensive set of policies that directly align with ISO 27001 and are supported by System and Organization Controls 2 (SOC2) reports and external ISO 27001:2013 certification for certain parts of our business. • Education and Awareness – To foster employee awareness of cybersecurity threats, we provide periodic educational sessions to our employees, including annual training on general cybersecurity concepts and targeted educational opportunities that include real-life simulation and “tabletop exercises.” We also regularly conduct privacy and security summits that involve training and information sessions conducted by employees and by third parties. • Third-Party Risk Management (“TPRM”) – Our TPRM function focuses on mitigating cybersecurity risk from specific third-party vendor categories.
Biggest changeFurther, Zebra relies on its information security management system supported by a comprehensive set of policies that directly align with ISO 27001 and are supported by System and Organization Controls 2 (SOC2) reports and external ISO 27001 certification for certain parts of our business. • Education and Awareness – To foster employee awareness of cybersecurity threats, we provide periodic educational sessions to our employees, including annual training on general cybersecurity concepts and targeted educational opportunities that include real-life simulation and “tabletop exercises.” We also regularly conduct privacy and security summits that involve training and information sessions conducted by employees and by third parties. • Third-Party Risk Management (“TPRM”) – Our TPRM function focuses on mitigating cybersecurity risk posed by third parties, with an emphasis on vendors who have access to sensitive data or are integrated with critical business systems.
He is a recognized leader in the field of cybersecurity with over 15 years of global executive cybersecurity experience. 24 Table of Contents The Chief Information Officer (“CIO”) is a peer to the CSO, also reports to the CFO. The CIO and his team are responsible for executing cybersecurity risk mitigation plans.
He is a recognized leader in the field of cybersecurity with over 15 years of global executive cybersecurity experience. 24 Table of Contents The Chief Information Officer (“CIO”) is a peer to the CSO, also reports to the CFO.
Zebra’s current CIO was appointed to the role in 2022 and has nearly 20 years of experience in managing IT functions. The Chief Information Security Officer (“CISO”) reports to the CSO and oversees the Company’s Security Operations Center (“SOC”). The CISO establishes and oversees the execution of prioritized cybersecurity mitigation plans for the Company.
The Chief Information Security Officer (“CISO”) reports to the CSO and oversees the Company’s Security Operations Center (“SOC”). The CISO establishes and oversees the execution of prioritized cybersecurity mitigation plans for the Company.
Added
The CIO and CSO partner to define and execute the Company’s cybersecurity strategy, with the CIO’s organization responsible for executing cybersecurity risk mitigation plans. Zebra’s current CIO was appointed to the role in 2022 and has nearly 20 years of experience in managing IT functions.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeWe generally consider the productive capacity of our facilities to be adequate and sufficient for our requirements. The extent of utilization of each manufacturing facility varies throughout the year.
Biggest changeSee Note 13, Leases in the Notes to Consolidated Financial Statements for further details related to the Company’s lease arrangements. 25 Table of Contents We generally consider the productive capacity of our facilities to be adequate and sufficient for our requirements. The extent of utilization of each manufacturing facility varies throughout the year.
Item 2. Properties Our corporate headquarters are located in Lincolnshire, Illinois; a northern suburb of Chicago. We also operate manufacturing, repair, distribution and warehousing, administrative, research, and sales facilities in other U.S. and international locations. As of December 31, 2024, the Company owned 3 laboratory and warehouse facilities located in the U.S., U.K., and Canada.
Item 2. Properties Our corporate headquarters are located in Lincolnshire, Illinois; a northern suburb of Chicago. We also operate manufacturing, repair, distribution and warehousing, administrative, research, and sales facilities in other U.S. and international locations. As of December 31, 2025, the Company owned 3 laboratory and warehouse facilities located in the U.S., U.K., and Canada.
As of December 31, 2024, the Company had a total of 111 leased facilities with locations spread globally; 29 of which are located in the U.S. and 82 of which are located in other countries. See Note 13, Leases in the Notes to Consolidated Financial Statements for further details related to the Company’s lease arrangements.
As of December 31, 2025, the Company had a total of 126 leased facilities with locations spread globally; 31 of which are located in the U.S. and 95 of which are located in other countries.

Item 4. Mine Safety Disclosures

Mine Safety Disclosures — required of mining issuers

2 edited+0 added−0 removed1 unchanged
Biggest changeFinancial Statements and Supplementary Data 40 Report of Independent Registered Public Accounting Firm 41 Consolidated Balance Sheets 43 Consolidated Statements of Operations 44 Consolidated Statements of Comprehensive Income 45 Consolidated Statements of Stockholders’ Equity 46 Consolidated Statements of Cash Flows 47 Notes to Consolidated Financial Statements 48 Note 1: Description of Business and Basis of Presentation 48 Note 2: Significant Accounting Policies 48 Note 3: Revenues 52 Note 4: Inventories 54 Note 5: Business Acquisitions 54 Note 6: Goodwill and Other Intangibles 55 Note 7: Property, Plant and Equipment 56 Note 8: Investments 56 Note 9: Exit and Restructuring Costs 56 Note 10: Fair Value Measurements 56 Note 11: Derivative Instruments 57 Note 12: Long-Term Debt 60 Note 13: Leases 61 Note 14: Accrued Liabilities, Commitments and Contingencies 63 Note 15: Share-Based Compensation 64 Note 16: Income Taxes 66 2 Table of Contents Note 17: Earnings Per Share 69 Note 18: Accumulated Other Comprehensive (Loss) Income 70 Note 19: Accounts Receivables Factoring 70 Note 20: Segment Information & Geographic Data 71
Biggest changeFinancial Statements and Supplementary Data 41 Report of Independent Registered Public Accounting Firm 42 Consolidated Balance Sheets 45 Consolidated Statements of Operations 46 Consolidated Statements of Comprehensive Income 47 Consolidated Statements of Stockholders’ Equity 48 Consolidated Statements of Cash Flows 49 Notes to Consolidated Financial Statements 50 Note 1: Description of Business and Basis of Presentation 50 Note 2: Significant Accounting Policies 50 Note 3: Revenues 54 Note 4: Inventories 56 Note 5: Business Acquisitions 56 Note 6: Goodwill and Other Intangibles 57 Note 7: Property, Plant and Equipment 58 Note 8: Investments 59 Note 9: Exit and Restructuring Costs 59 Note 10: Fair Value Measurements 59 Note 11: Derivative Instruments 60 Note 12: Long-Term Debt 63 Note 13: Leases 64 Note 14: Accrued Liabilities, Commitments and Contingencies 65 Note 15: Share-Based Compensation 66 Note 16: Income Taxes 69 2 Table of Contents Note 17: Earnings Per Share 73 Note 18: Accumulated Other Comprehensive (Loss) Income 73 Note 19: Accounts Receivables Factoring 74 Note 20: Segment Information & Geographic Data 75 Note 21: Subsequent Events 77
Management’s Discussion and Analysis of Financial Condition and Results of Operations 30 Overview 30 Results of Operations 31 Liquidity and Capital Resources 34 Critical Accounting Estimates 37 New Accounting Pronouncements 38 Non-GAAP Measures 38 Item 7A. Quantitative and Qualitative Disclosures About Market Risk 39 Item 8.
Management’s Discussion and Analysis of Financial Condition and Results of Operations 30 Overview 30 Results of Operations 32 Liquidity and Capital Resources 36 Critical Accounting Estimates 38 New Accounting Pronouncements 39 Non-GAAP Measures 39 Item 7A. Quantitative and Qualitative Disclosures About Market Risk 40 Item 8.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

8 edited+1 added−0 removed2 unchanged
Biggest changeSubsequent to the year ended December 31, 2024, the Company has repurchased 128,466 shares of common stock for approximately $50 million through February 6, 2025. 27 Table of Contents Stock Performance Graph The following graph compares the cumulative total stockholder return, calculated on a dividend-reinvested basis, in Zebra Technologies Corporation Class A Common Stock, the S&P 500 Index, and the S&P 500 Information Technology Index for the five years ended December 31, 2024.
Biggest changeLike the Company’s existing share repurchase authorization, 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. 27 Table of Contents Stock Performance Graph The following graph compares the cumulative total stockholder return, calculated on a dividend-reinvested basis, in Zebra Technologies Corporation Class A Common Stock, the S&P 500 Index, and the S&P 500 Information Technology Index for the five years ended December 31, 2025.
The comparison assumes that $100 was invested in each of the Company’s Class A Common Stock, the S&P 500 Index, and the S&P 500 Information Technology Index as of the market close on December 31, 2019. Note that historic stock price performance is not necessarily indicative of future stock price performance.
The comparison assumes that $100 was invested in each of the Company’s Class A Common Stock, the S&P 500 Index, and the S&P 500 Information Technology Index as of the market close on December 31, 2020. Note that historic stock price performance is not necessarily indicative of future stock price performance.
We currently do not anticipate paying any cash dividends in the foreseeable future. Treasury Shares The following table sets forth information with respect to repurchases of the Company’s common stock for the three months ended December 31, 2024.
We currently do not anticipate paying any cash dividends in the foreseeable future. Treasury Shares The following table sets forth information with respect to repurchases of the Company’s common stock for the three months ended December 31, 2025.
As of February 6, 2025, the last reported price for the Company’s Class A Common Stock was $376.80 per share, and there were 78 registered stockholders of record for Zebra’s Class A Common Stock.
As of February 5, 2026, the last reported price for the Company’s Class A Common Stock was $241.08 per share, and there were 72 registered stockholders of record for Zebra’s Class A Common Stock.
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) September 29, 2024 - October 26, 2024 — $ — — $ 877 October 27, 2024 - November 23, 2024 — — — 877 November 24, 2024 - December 31, 2024 80,256 387.20 80,256 846 Total 80,256 $ — 80,256 $ 846 (1) On May 17, 2022, the Company announced that its Board of Directors authorized a share repurchase program for up to $1 billion of its outstanding shares of common stock.
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) September 28, 2025 - October 25, 2025 85,458 $ 292.54 85,458 $ 537 October 26, 2025 - November 22, 2025 699,102 253.89 699,102 360 November 23, 2025 - December 31, 2025 392,678 254.66 392,678 259 Total 1,177,238 $ 256.96 1,177,238 $ 259 (1) On May 17, 2022, the Company announced that its Board of Directors authorized a share repurchase program for up to $1 billion of its outstanding shares of common stock.
This authorization augments the previous $1 billion share repurchase authorization which was announced on July 30, 2019 and completed in the fourth quarter of 2022. Repurchases may be affected 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.
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.
As of December 31, 2024, the Company has cumulatively repurchased 539,574 shares of common stock for approximately $154 million, resulting in a remaining amount of share repurchases authorized under the plans of $846 million.
As of December 31, 2025, the Company has cumulatively repurchased 2,677,701 shares of common stock for approximately $741 million, resulting in a remaining amount of share repurchases authorized under the plans of $259 million. Subsequent to the year ended December 31, 2025, the Company repurchased 401,649 shares of common stock for approximately $100 million through February 5, 2026.
Value at each year-end of $100 initial investment made on December 31, 2019 12/19 12/20 12/21 12/22 12/23 12/24 Zebra Technologies Corporation $ 100.00 $ 150.46 $ 233.01 $ 100.38 $ 107.00 $ 151.20 S&P 500 $ 100.00 $ 118.40 $ 152.39 $ 124.79 $ 157.59 $ 197.02 S&P 500 Information Technology $ 100.00 $ 143.89 $ 193.58 $ 139.00 $ 219.40 $ 299.72 28 Table of Contents
Value at each year-end of $100 initial investment made on December 31, 2020 12/20 12/21 12/22 12/23 12/24 12/25 Zebra Technologies Corporation $ 100.00 $ 154.87 $ 66.72 $ 71.12 $ 100.49 $ 63.18 S&P 500 $ 100.00 $ 128.71 $ 105.40 $ 133.10 $ 166.40 $ 196.16 S&P 500 Information Technology $ 100.00 $ 134.53 $ 96.60 $ 152.48 $ 208.30 $ 258.38 28 Table of Contents
Added
Additionally, on February 4, 2026, the Company’s Board of Directors authorized additional share repurchases of up to $1 billion of outstanding shares of common stock. This additional authorization does not supersede the existing authorization that was announced in and has been active since 2022.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

46 edited+24 added−28 removed15 unchanged
Biggest changeThe following table summarizes our cash flow activities for the years indicated (in millions): Year Ended December 31, $ Change 2024 vs 2023 $ Change 2023 vs 2022 2024 2023 2022 Cash flow provided by (used in): Operating activities $ 1,013 $ (4) $ 488 $ 1,017 $ (492) Investing activities (57) (92) (968) 35 876 Financing activities (190) 117 253 (307) (136) Effect of exchange rates on cash balances (3) — — (3) — Net increase (decrease) in cash and cash equivalents, including restricted cash $ 763 $ 21 $ (227) $ 742 $ 248 2024 vs. 2023 The change in our cash and cash equivalents balance during the current year is reflective of the following: • $1,017 million change in operating activities primarily due to the timing of cash payments and the reduction of overall inventory levels, lower legal settlement, income tax, and employee incentive compensation payments, higher cash receipts on interest rate swaps attributed to the termination of those agreements, as well as overall improved operating profits. • $307 million change in financing activities primarily due to current year net debt repayments as a portion of the recently issued Senior Notes was utilized to reduce total debt, compared to net borrowings in the prior year. 34 Table of Contents Company Debt The following table shows the carrying value of the Company’s debt (in millions): December 31, 2024 2023 Term Loan A $ 1,575 $ 1,684 Senior Notes 500 — Revolving Credit Facility — 413 Receivables Financing Facilities 108 129 Total debt $ 2,183 $ 2,226 Less: Debt issuance costs (9) (2) Less: Unamortized discounts (3) (4) Less: Current portion of debt (79) (173) Total long-term debt $ 2,092 $ 2,047 Term Loan A The principal on Term Loan A is due in quarterly installments, with the next quarterly installment due in the second quarter of 2026 and the majority due upon maturity in 2027.
Biggest changeThe following table summarizes our cash flow activities for the years indicated (in millions): Year Ended December 31, $ Change 2025 vs 2024 $ Change 2024 vs 2023 2025 2024 2023 Cash flow provided by (used in): Operating activities $ 917 $ 1,013 $ (4) $ (96) $ 1,017 Investing activities (1,455) (57) (92) (1,398) 35 Financing activities (239) (190) 117 (49) (307) Effect of exchange rates on cash balances 1 (3) — 4 (3) Net (decrease) increase in cash and cash equivalents, including restricted cash $ (776) $ 763 $ 21 $ (1,539) $ 742 Cash flow provided by (used in): Operating activities $ 917 $ 1,013 $ (4) $ (96) $ 1,017 Less: Purchases of property, plant and equipment (86) (59) (87) (27) 28 Free cash flow (Non-GAAP) (1) $ 831 $ 954 $ (91) $ (123) $ 1,045 (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. 2025 vs. 2024 The change in our cash and cash equivalents balance during the current year was primarily due to the following: • $96 million decrease in net operating cash inflows primarily due to larger reductions in inventory in the prior year, higher employee incentive compensation payments in the current year, and cash receipts from the settlements of terminated interest rate swap agreements in the prior year.
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.
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.
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.
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 expected use of cash is based on the Company’s current borrowings and applicable interest rates and margins as of December 31, 2024, and includes principal and interest payments. In the ordinary course of business, the Company may decide to borrow additional amounts or repay principal earlier than contractually owed, which would affect future cash payments.
This expected use of cash is based on the Company’s current borrowings and applicable interest rates and margins as of December 31, 2025, and includes principal and interest payments. In the ordinary course of business, the Company may decide to borrow additional amounts or repay principal earlier than contractually owed, which would affect future cash payments.
There were no changes to our estimation processes for consideration received or SSP that materially affected revenues during the year. 37 Table of Contents New Accounting Pronouncements See Note 2, Significant Accounting Policies in the Notes to Consolidated Financial Statements regarding recent accounting pronouncements.
There were no changes to our estimation processes for consideration received or SSP that materially affected revenues during the year. 38 Table of Contents New Accounting Pronouncements See Note 2, Significant Accounting Policies in the Notes to Consolidated Financial Statements regarding recent accounting pronouncements.
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. 31 Table of Contents (2) For purposes of computing Organic Net sales growth (decline), amounts directly attributable to business acquisitions are excluded for twelve months following their respective acquisitions.
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. 32 Table of Contents (2) For purposes of computing Organic Net sales growth, amounts directly attributable to business acquisitions are excluded for twelve months following their respective acquisitions.
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. 38 Table of Contents
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. 39 Table of Contents
(3) Consolidated Organic Net sales growth (decline) is a non-GAAP financial measure.
(3) Consolidated Organic Net sales growth is a non-GAAP financial measure.
Future Cash Requirements We believe that our Cash and cash equivalents, which totaled $901 million as of December 31, 2024, along with anticipated cash generation from operations and available borrowing capacity on debt and other financing facilities, will be sufficient to fund the Company’s cash requirements during the next 12 months and thereafter based on our current business plans.
Future Cash Requirements We believe that our Cash and cash equivalents, which totaled $125 million as of December 31, 2025, along with anticipated cash generation from operations and available borrowing capacity on debt and other financing facilities, will be sufficient to fund the Company’s cash requirements during the next 12 months and thereafter based on our current business plans.
Our cash requirements during the next 12 months and thereafter include payments to satisfy the following obligations: • Purchase obligations — The Company has a limited number of multi-year purchase commitments, primarily related to semiconductors and cloud services, which contain minimum purchase requirements and are non-cancellable. As of December 31, 2024, these multi-year commitments were approximately $138 million.
Our cash requirements during the next 12 months and thereafter include payments to satisfy the following obligations: • Purchase obligations — The Company has a limited number of multi-year purchase commitments, primarily related to semiconductors and cloud services, which contain minimum purchase requirements and are non-cancellable. As of December 31, 2025, these multi-year commitments were approximately $101 million.
Included in the Company’s Cash and cash equivalents are amounts held by foreign subsidiaries, which was $52 million and $33 million as of December 31, 2024 and 2023, respectively. We do not expect that Cash and cash equivalents held by foreign subsidiaries will need to be repatriated to fund the Company’s U.S. operations based on current cash requirements.
Included in the Company’s Cash and cash equivalents are amounts held by foreign subsidiaries, which was $39 million and $52 million as of December 31, 2025 and 2024, respectively. We do not expect that Cash and cash equivalents held by foreign subsidiaries will need to be repatriated to fund the Company’s U.S. operations based on current cash requirements.
See Note 12, Long-Term Debt in the Notes to Consolidated Financial Statements for further details related to the Company’s debt facilities. 36 Table of Contents • Leases obligations — We lease various manufacturing and repair facilities, distribution centers, research facilities, sales and administrative offices, equipment, and vehicles.
See Note 12, Long-Term Debt in the Notes to Consolidated Financial Statements for further details related to the Company’s debt facilities. • Leases obligations — We lease various manufacturing and repair facilities, distribution centers, research facilities, sales and administrative offices, equipment, and vehicles.
This impact is calculated by 33 Table of Contents 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.
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.
See Note 14, Accrued Liabilities, Commitments and Contingencies in the Notes to Consolidated Financial Statements for additional details. • Debt obligations — We expect to make total payments of approximately $210 million associated with the Company’s debt facilities in 2025.
See Note 14, Accrued Liabilities, Commitments and Contingencies in the Notes to Consolidated Financial Statements for additional details. • Debt obligations — We expect to make total payments of approximately $275 million associated with the Company’s debt facilities in 2026.
These supplemental non-GAAP financial measures – Consolidated Organic Net sales growth (decline), AIT Organic Net sales (decline), and EVM Organic Net sales growth (decline) – are presented because our management evaluates our financial results both including and excluding the effects of business acquisitions and foreign currency translation, as applicable.
These supplemental non-GAAP financial measures – Consolidated Organic Net sales growth, CF Organic Net sales growth, AVA Organic Net sales growth (decline), and Free cash flow – are presented because our management evaluates our financial results both including and excluding the effects of business acquisitions and foreign currency translation, as applicable.
Significant judgments included in our forecasts include projecting future sales volumes and pricing, costs to manufacture and procure products and to deliver offerings, among other factors. There were no significant changes in estimates to our income tax provision during the current year. Acquisitions We account for acquired businesses using the acquisition method of accounting.
Significant judgments included in our forecasts include projecting future sales volumes and pricing, costs to manufacture and procure products and to deliver offerings, among other factors. Our estimate of the current year income tax provision includes the impact of the 2025 U.S. tax legislation. Acquisitions We account for acquired businesses using the acquisition method of accounting.
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) AIT Organic Net sales (decline) is a non-GAAP financial measure.
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.
Additionally, some of our contracts with customers contain multiple performance obligations, including various hardware, software, and/or services. For such contracts that contain multiple performance obligations, we allocate the estimated total transaction price to each performance obligation based on relative standalone selling prices (“SSP”). The determination of SSP is established at a regional level.
For such contracts that contain multiple performance obligations, we allocate the estimated total transaction price to each performance obligation based on relative standalone selling prices (“SSP”). The determination of SSP is established at a regional level.
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations This section generally discusses fiscal 2024 and 2023 items and year-over-year comparisons between 2024 and 2023. Discussions of 2022 items and year-over-year comparisons between 2023 and 2022 are not included herein.
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations This section generally discusses fiscal 2025 and 2024 items and year-over-year comparisons between 2025 and 2024.
Operating income decreased 3.2% in the current year compared to the prior year due to higher Operating expenses partially offset by higher Gross profit.
Operating income increased 4.7% in the current year compared to the prior year due to higher Gross profit, partly offset by higher Operating expenses.
(2) For purposes of computing EVM Organic Net sales growth (decline), amounts directly attributable to business acquisitions are excluded for twelve months following their respective acquisitions. (3) EVM Organic Net sales growth (decline) is a non-GAAP financial measure.
(2) For purposes of computing AVA Organic Net sales growth (decline), amounts directly attributable to the acquisition of Photoneo are excluded for twelve months following the February 28, 2025 acquisition date. (3) AVA Organic Net sales growth (decline) is a non-GAAP financial measure.
The acquired business will become part of the EVM segment. 30 Table of Contents Results of Operations: Year Ended 2024 versus 2023 and Year Ended 2023 versus 2022 Consolidated Results of Operations (amounts in millions, except percentages) Year Ended December 31, Percent Change 2024 vs 2023 Percent Change 2023 vs 2022 2024 2023 2022 Net sales: Tangible products $ 4,016 $ 3,665 $ 4,915 9.6 % (25.4) % Services and software 965 919 866 5.0 % 6.1 % Total Net sales 4,981 4,584 5,781 8.7 % (20.7) % Gross profit 2,413 2,123 2,624 13.7 % (19.1) % Gross margin 48.4 % 46.3 % 45.4 % 210 bps 90 bps Operating expenses 1,671 1,642 2,095 1.8 % (21.6) % Operating income $ 742 $ 481 $ 529 54.3 % (9.1) % Net sales to customers by geographic region were as follows (amounts in millions, except percentages): Year Ended December 31, Percent Change 2024 vs 2023 Percent Change 2023 vs 2022 2024 2023 2022 North America $ 2,547 $ 2,405 $ 2,919 5.9 % (17.6) % EMEA 1,617 1,414 1,920 14.4 % (26.4) % Asia-Pacific 490 481 609 1.9 % (21.0) % Latin America 327 284 333 15.1 % (14.7) % Total Net sales $ 4,981 $ 4,584 $ 5,781 8.7 % (20.7) % Operating expenses are summarized below (amounts in millions, except percentages): Year Ended December 31, As a Percentage of Net sales 2024 2023 2022 2024 2023 2022 Selling and marketing $ 600 $ 581 $ 607 12.0 % 12.7 % 10.5 % Research and development 563 519 570 11.3 % 11.3 % 9.9 % General and administrative 381 334 375 7.6 % 7.3 % 6.5 % Settlement and related costs — — 372 — % — % 6.4 % Amortization of intangible assets 104 104 136 NM NM NM Acquisition and integration costs 6 6 21 NM NM NM Exit and restructuring costs 17 98 14 NM NM NM Total Operating expenses $ 1,671 $ 1,642 $ 2,095 33.5 % 35.8 % 36.2 % Consolidated Organic Net sales growth (decline): Year Ended December 31, 2024 2023 Reported GAAP Consolidated Net sales growth (decline) 8.7 % (20.7) % Adjustments: Impact of foreign currency translations (1) (0.6) % 1.4 % Impact of acquisitions (2) — % (0.5) % Consolidated Organic Net sales growth (decline) (3) 8.1 % (19.8) % (1) Operating results reported in U.S.
See Note 5, Business Acquisitions in the Notes to Consolidated Financial Statements for additional details. 31 Table of Contents Results of Operations: Year Ended 2025 versus 2024 and Year Ended 2024 versus 2023 Consolidated Results of Operations (amounts in millions, except percentages) Year Ended December 31, Percent Change 2025 vs 2024 Percent Change 2024 vs 2023 2025 2024 2023 Net sales: Tangible products $ 4,418 $ 4,016 $ 3,665 10.0 % 9.6 % Services and software 978 965 919 1.3 % 5.0 % Total Net sales 5,396 4,981 4,584 8.3 % 8.7 % Gross profit 2,593 2,413 2,123 7.5 % 13.7 % Gross margin 48.1 % 48.4 % 46.3 % (30) bps 210 bps Operating expenses 1,893 1,671 1,642 13.3 % 1.8 % Operating income $ 700 $ 742 $ 481 (5.7) % 54.3 % Net sales to customers by geographic region were as follows (amounts in millions, except percentages): Year Ended December 31, Percent Change 2025 vs 2024 Percent Change 2024 vs 2023 2025 2024 2023 North America $ 2,695 $ 2,492 $ 2,353 8.1 % 5.9 % EMEA 1,724 1,635 1,433 5.4 % 14.1 % Asia-Pacific 613 526 513 16.5 % 2.5 % Latin America 364 328 285 11.0 % 15.1 % Total Net sales $ 5,396 $ 4,981 $ 4,584 8.3 % 8.7 % Operating expenses are summarized below (amounts in millions, except percentages): Year Ended December 31, As a Percentage of Net sales 2025 2024 2023 2025 2024 2023 Selling and marketing $ 653 $ 600 $ 581 12.1 % 12.0 % 12.7 % Research and development 593 563 519 11.0 % 11.3 % 11.3 % General and administrative 433 381 334 8.0 % 7.6 % 7.3 % Amortization of intangible assets 114 104 104 NM NM NM Acquisition and integration costs 24 6 6 NM NM NM Exit and restructuring costs 76 17 98 NM NM NM Total Operating expenses $ 1,893 $ 1,671 $ 1,642 35.1 % 33.5 % 35.8 % Consolidated Organic Net sales growth: Year Ended December 31, 2025 2024 Reported GAAP Consolidated Net sales growth 8.3 % 8.7 % Adjustments: Impact of foreign currency translations (1) — % (0.6) % Impact of acquisitions (2) (2.1) % — % Consolidated Organic Net sales growth (3) 6.2 % 8.1 % (1) Operating results reported in U.S.
Diluted earnings per share increased to $10.18 as compared to $5.72 in the prior year primarily due to higher Net income. 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 20, Segment Information & Geographic Data in the Notes to Consolidated Financial Statements.
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 20, Segment Information & Geographic Data in the Notes to Consolidated Financial Statements.
Operating income for the current year increased 55.7% compared to the prior year due to higher Gross profit partially offset by higher Operating expenses. 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.
Operating income decreased by 1.6% in 2024 compared to 2023 due to lower Gross profit, partly offset by lower Operating expenses. 35 Table of Contents 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.
Refer to “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7 of the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2023 for that discussion. Overview The Company is a global leader in providing Enterprise Asset Intelligence (“EAI”) offerings in the Automatic Identification and Data Capture (“AIDC”) industry.
Refer to “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7 of the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2024 for that discussion.
See the Non-GAAP Measures section at the end of this item. 2024 compared to 2023 Total Net sales for EVM increased $401 million or 13.7% compared to the prior year primarily due to higher sales of mobile computing products, and services and software, partially offset by lower sales of data capture products.
See the Non-GAAP Measures section at the end of this item. 2025 compared to 2024 Total Net sales for CF increased $246 million, or 9.1%, compared to the prior year primarily due to higher sales of mobile computing products and the net sales of Elo. CF Organic Net sales increased by 5.6%.
Excluding the impacts of foreign currency changes and acquisitions, EVM Organic Net sales increased by 13.2%. Gross margin increased to 48.6% in the current year compared to 45.6% for the prior year primarily due to volume leverage, favorable business mix, higher service and software margins, lower inventory-related charges, and lower freight rates.
CF Organic Net sales increased by 18.5%. Gross margin increased to 49.2% in 2024 compared to 45.2% in 2023 primarily due to volume leverage, favorable business mix, higher service and software margins, lower freight rates, and lower inventory-related charges.
Excluding the effects of foreign currency changes and acquisitions, Consolidated Organic Net sales increased by 8.1%. Gross margin increased to 48.4% for the current year compared to 46.3% in the prior year. The increase was primarily due to volume leverage, higher service and software margins, lower freight rates, and lower inventory-related charges.
Excluding the effects of foreign currency changes and acquisitions, Consolidated Organic Net sales increased by 6.2%. Gross margin decreased to 48.1% for the current year compared to 48.4% in the prior year. The decrease was primarily due to unfavorable impacts of tariffs, net of mitigating actions, along with lower services and software margins, largely offset by volume leverage favorability.
See the Non-GAAP Measures section at the end of this item. 2024 compared to 2023 Total Net sales for AIT decreased $4 million or 0.2% compared to the prior year primarily due to lower sales of printing products and supplies, partially offset by favorable foreign currency changes and higher sales of RFID products.
See the Non-GAAP Measures section at the end of this item. 2025 compared to 2024 Total Net sales for AVA increased $169 million, or 7.5%, compared to the prior year primarily due to higher sales of printing products, as well as higher sales of RFID, supplies and sensors, and data capture products. AVA Organic Net sales increased by 7.0%.
Excluding the impact of foreign currency changes, AIT Organic Net sales decreased by 0.9%. Gross margin increased to 48.1% in the current year compared to 47.7% for the prior year primarily due to favorable foreign currency changes, partially offset by higher inventory-related charges.
AVA Organic Net sales decreased by 2.2%. Gross margin increased to 48.0% in 2024 compared to 47.7% in the previous year primarily due to favorable business mix, partly offset by higher inventory related charges.
The timing, volume, and nature of repurchases are subject to market conditions, applicable securities laws and other factors and may be amended, suspended or discontinued at any time. Repurchases may be affected 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.
The timing, volume, and nature of repurchases are also subject to market conditions, applicable securities laws and other factors and may be amended, suspended or discontinued at any time.
Gross margin was higher in both segments, particularly EVM. Operating expenses for the years ended December 31, 2024 and 2023 were $1,671 million and $1,642 million, or 33.5% and 35.8% of Net sales, respectively.
Gross margin was higher in AVA and declined in CF. As we exited 2025, the unfavorable impacts of existing import tariffs have been fully mitigated. Operating expenses for the years ended December 31, 2025 and 2024 were $1,893 million and $1,671 million, or 35.1% and 33.5% of Net sales, respectively.
Our annual impairment testing, most recently completed in the fourth quarter of 2024, continues to indicate that the fair values of each of our reporting units significantly exceed their respective carrying values. Revenue Recognition We recognize revenues when we transfer control of promised offerings to our customers in an amount that reflects the consideration we expect to receive.
Our annual impairment testing, most recently completed in the fourth quarter of 2025 both immediately before and after the Company’s segment and reporting unit change, continues to indicate that the fair values of each of our reporting units exceed their respective carrying values.
As of December 31, 2024, the Company’s fixed lease commitments totaled $233 million, of which $46 million is payable in 2025. See Note 13, Leases in the Notes to Consolidated Financial Statements for further details related to the Company’s lease arrangements.
As of December 31, 2025, the Company’s fixed lease commitments totaled $234 million, of which $49 million is payable in 2026.
Subsequent to the year ended December 31, 2024, the Company has repurchased 128,466 shares of common stock for approximately $50 million through February 6, 2025.
Subsequent to the year ended December 31, 2025, the Company repurchased 401,649 shares of common stock for approximately $100 million through February 5, 2026. Additionally, on February 4, 2026, the Company’s Board of Directors authorized additional share repurchases of up to $1 billion.
See the Non-GAAP Measures section at the end of this item. 2024 compared to 2023 Total Net sales increased $397 million or 8.7% compared to the prior year reflecting growth in our EVM segment that was partially offset by a slight decline in our AIT segment as the current year recovery in demand trends benefited EVM earlier in the year than AIT.
See the Non-GAAP Measures section at the end of this item. 2025 compared to 2024 Total Net sales increased $415 million or 8.3% compared to the prior year reflecting growth in both our AVA and CF segments associated with improved demand trends that began in the middle of 2024, along with contributions from our recent Elo and Photoneo acquisitions.
Asset Intelligence & Tracking Segment (“AIT”) (amounts in millions, except percentages) Year Ended December 31, Percent Change 2024 vs 2023 Percent Change 2023 vs 2022 2024 2023 2022 Net sales: Tangible products $ 1,532 $ 1,537 $ 1,728 (0.3) % (11.1) % Services and software 115 114 109 0.9 % 4.6 Total Net sales 1,647 1,651 1,837 (0.2) % (10.1) % Gross profit 793 787 795 0.8 % (1.0) % Gross margin 48.1 % 47.7 % 43.3 % 40 bps 440 bps Operating expenses 458 441 434 3.9 % 1.6 % Operating income $ 335 $ 346 $ 361 (3.2) % (4.2) % 32 Table of Contents AIT Organic Net sales (decline): Year Ended December 31, 2024 2023 AIT Reported GAAP Net sales (decline) (0.2) % (10.1) % Adjustments: Impact of foreign currency translations (1) (0.7) % 1.3 % AIT Organic Net sales (decline) (2) (0.9) % (8.8) % (1) Operating results reported in U.S.
Operating income increased 70.4% in 2024 compared to 2023 due to higher Gross profit, partly offset by higher Operating expenses. 34 Table of Contents Asset Visibility & Automation (“AVA”) (amounts in millions, except percentages) Year Ended December 31, Percent Change 2025 vs 2024 Percent Change 2024 vs 2023 2025 2024 2023 Net sales: Tangible products $ 2,262 $ 2,100 $ 2,143 7.7 % (2.0) % Services and software 174 167 161 4.2 % 3.7 % Total Net sales 2,436 2,267 2,304 7.5 % (1.6) % Gross profit 1,219 1,088 1,098 12.0 % (0.9) % Gross margin 50.0 % 48.0 % 47.7 % 200 bps 30 bps Operating expenses 705 668 671 5.5 % (0.4) % Operating income $ 514 $ 420 $ 427 22.4 % (1.6) % AVA Organic Net sales growth (decline): Year Ended December 31, 2025 2024 AVA Reported GAAP Net sales growth (decline) 7.5 % (1.6) % Adjustments: Impact of foreign currency translations (1) — % (0.6) % Impact of acquisition (2) (0.5) % — % AVA Organic Net sales growth (decline) (3) 7.0 % (2.2) % (1) Operating results reported in U.S.
The consideration that we expect to receive is estimated by reflecting reductions to our transaction price for product returns, rebates, and other incentives. These estimates are developed using the expected value that the Company anticipates receiving and are based on recent trends observed in similar transactions.
Revenue Recognition We recognize revenues when we transfer control of promised offerings to our customers in an amount that reflects the consideration we expect to receive. The consideration that we expect to receive is estimated by reflecting reductions to our transaction price for product returns, rebates, and other incentives.
Current year Operating expenses were higher than the prior year primarily due to higher incentive compensation, partially offset by lower Exit and restructuring costs and incremental savings largely attributed to our Exit and restructuring actions. Operating income was $742 million for the current year compared to $481 million for the prior year.
Operating income was $700 million for the current year compared to $742 million for the prior year. The decrease was due to higher Operating expenses, partly offset by higher Gross profit.
In addition to the expected cash requirements described above, the Company may use cash to fund strategic acquisitions, investments, or repurchase common stock under its share repurchase program. We also expect to spend approximately $60 million to $70 million on capital expenditures in 2025.
See Note 13, Leases in the Notes to Consolidated Financial Statements for further details related to the Company’s lease arrangements. 37 Table of Contents In addition to the expected cash requirements described above, we may use cash to fund strategic acquisitions, investments, or repurchase common stock under our share repurchase program.
The increase was due to higher Gross profit partially offset by higher Operating expenses. Net income increased 78.4% compared to the prior year primarily due to higher Operating income, as described above, as well as lower Interest (expense) income, net which included higher interest rate swap gains and interest income in the current year.
Net income decreased 20.6% compared to the prior year due to lower Operating income, higher non-operating expenses, and higher income taxes, as described above.
The AIDC market consists of mobile computing, data capture, radio frequency identification devices (“RFID”), barcode printing, and other workflow automation offerings. The Company’s operations consist of two reportable segments that provide complementary offerings to our customers: Asset Intelligence & Tracking (“AIT”) and Enterprise Visibility & Mobility (“EVM”).
Overview The Company is a global leader in the Automatic Identification and Data Capture (“AIDC”) industry, ensuring frontline operations everywhere are digitized, automated and intelligent. The AIDC market consists of mobile computing, data capture, radio frequency identification devices (“RFID”), thermal barcode printing, and other workflow automation offerings.
Total charges associated with the 2022 Productivity Plan and the U.S. voluntary retirement plan (“VRP”), which was completed in 2023, were $127 million, including $17 million recorded in the current year. The costs of these actions are classified within Exit and restructuring on the Consolidated Statements of Operations.
The total cost under the 2025 Productivity Plan, which is expected to be substantially completed in 2026 and will primarily consist of employee severance costs, is estimated to be approximately $35- 40 million, including $21 million recognized in the fourth quarter of 2025. The costs of these actions are classified within Exit and restructuring on the Consolidated Statements of Operations.
The Company’s effective tax rates for the years ended December 31, 2024 and December 31, 2023 were 16.9% and 11.4%, respectively. The increase in the effective tax rate compared to the prior year was primarily due to lower rate benefits from tax credits and discrete items as well as higher state income taxes.
The Company’s effective tax rates for the years ended December 31, 2025 and December 31, 2024 were 25.2% and 16.9%, respectively.
Enterprise Visibility & Mobility Segment (“EVM”) (amounts in millions, except percentages) Year Ended December 31, Percent Change 2024 vs 2023 Percent Change 2023 vs 2022 2024 2023 2022 Net sales: Tangible products $ 2,484 $ 2,128 $ 3,187 16.7 % (33.2) % Services and software 850 805 757 5.6 % 6.3 % Total Net sales 3,334 2,933 3,944 13.7 % (25.6) % Gross profit 1,620 1,336 1,829 21.3 % (27.0) % Gross margin 48.6 % 45.6 % 46.4 % 300 bps (80) bps Operating expenses 1,086 993 1,118 9.4 % (11.2) % Operating income $ 534 $ 343 $ 711 55.7 % (51.8) % EVM Organic Net sales growth (decline): Year Ended December 31, 2024 2023 EVM Reported GAAP Net sales growth (decline) 13.7 % (25.6) % Adjustments: Impact of foreign currency translations (1) (0.5) % 1.5 % Impact of acquisitions (2) — % (0.8) % EVM Organic Net sales growth (decline) (3) 13.2 % (24.9) % (1) Operating results reported in U.S.
To the extent applicable, 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) are excluded from segment results. 33 Table of Contents Connected Frontline (“CF”) (amounts in millions, except percentages) Year Ended December 31, Percent Change 2025 vs 2024 Percent Change 2024 vs 2023 2025 2024 2023 Net sales: Tangible products $ 2,156 $ 1,916 $ 1,522 12.5 % 25.9 % Services and software 804 798 758 0.8 % 5.3 % Total Net sales 2,960 2,714 2,280 9.1 % 19.0 % Gross profit 1,396 1,334 1,031 4.6 % 29.4 % Gross margin 47.2 % 49.2 % 45.2 % (200) bps 400 bps Operating expenses 811 775 703 4.6 % 10.2 % Operating income $ 585 $ 559 $ 328 4.7 % 70.4 % CF Organic Net sales growth: Year Ended December 31, 2025 2024 CF Reported GAAP Net sales growth 9.1 % 19.0 % Adjustments: Impact of foreign currency translations (1) — % (0.5) % Impact of acquisition (2) (3.5) % — % CF Organic Net sales growth (3) 5.6 % 18.5 % (1) Operating results reported in U.S.
Our workflow optimization solutions include cloud-based software subscriptions, retail solutions, and robotic automation solutions. 2024 Financial Summary and Other Recent Developments • Net sales were $4,981 million in the current year compared to $4,584 million in the prior year. • Operating income was $742 million in the current year compared to $481 million in the prior year. • Net income was $528 million, or $10.18 per diluted share in the current year, compared to Net income of $296 million, or $5.72 per diluted share in the prior year. • Net cash provided by operating activities was $1,013 million in the current year compared to net cash used in operating activities of $4 million in the prior year.
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. 2025 Financial Summary and Other Recent Developments • Net sales were $5,396 million in the current year compared to $4,981 million in the prior year. • Operating income was $700 million in the current year compared to $742 million in the prior year. • Net income was $419 million, or $8.18 per diluted share in the current year, compared to Net income of $528 million, or $10.18 per diluted share in the prior year. • We repurchased $587 million of common shares, including $303 million in the fourth quarter.
Removed
Refer to Part I, Item 1 of this document for additional information. • The AIT segment is an industry leader in barcode printing and asset tracking technologies.
Added
Discussions of 2023 items and year-over-year comparisons between 2024 and 2023 are not included herein, other than within the Results of Operations by Segment which reflects the changes made to our segment reporting made in 2025.
Removed
Its major product lines include barcode and card printers, RFID and RTLS offerings, and supplies, including temperature-monitoring labels, and services. • The EVM segment is an industry leader in automatic information and data capture offerings. Its major product lines include mobile computing, data capture, fixed industrial scanning and machine vision, services, and workflow optimization solutions.
Added
Effective in the fourth quarter of 2025, we realigned our reportable segments from the former Enterprise Visibility & Mobility (EVM) and Asset Intelligence & Tracking (AIT) segments to two new segments: Connected Frontline (“CF”) and Asset Visibility and Automation (“AVA”). Our CF and AVA segment results will also exclude share-based compensation expense from the measurement of segment operating income.
Removed
As we entered 2024, we saw the stabilization of distributor inventory levels in both of our segments and the beginning of a modest recovery in demand trends in certain of our offerings within our EVM segment. The demand trend recovery broadened across offerings within both segments beginning in the second half of the year contributing to improved revenue and profitability.
Added
Refer to Part I, Item 1 of this document for additional information. • 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.
Removed
As we look ahead to 2025, we expect increased uncertainty and volatility in global trade policy and foreign currency exchange rates. The Company completed its actions under the 2022 Productivity Plan in the current year.
Added
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.
Removed
Together, these programs have impacted over 9% of our global employee base and have generated approximately $120 million of annualized net cost savings, primarily within Operating expenses.
Added
Exit & Restructuring Actions: In the fourth quarter of 2025, we announced our intention to dispose of or exit our robotics automation solutions business in an effort to better align resources with our strategic priorities.
Removed
In the second quarter, the Company completed a private offering of $500 million senior unsecured notes (the “Senior Notes”) with a 6.5% fixed interest rate; the proceeds of which, were partially used to repay outstanding debt.
Added
In relation to this decision, we incurred approximately $55 million in one-time costs in the fourth quarter, principally consisting of long-lived asset impairments of $45 million, including an intangible asset impairment of $34 million, a right-of-use lease asset impairment of $8 million, and property, plant and equipment impairment of $3 million.
Removed
Additionally, with the issuance of the fixed rate Senior Notes, the Company terminated its interest rate swap agreements which were intended to result in a fixed interest rate on a portion of our variable rate debt. On December 27, 2024, the Company entered into a definitive agreement to acquire Photoneo, a leading developer and manufacturer of 3D machine vision offerings.
Added
The other one-time costs consisted of employee severance and working capital-related charges. These one-time costs are classified as Exit and restructuring on the Consolidated Statement of Operations. Additional costs may be incurred in 2026, as we complete the divestiture of this business.
Removed
The purchase price of approximately €60 million is expected to be funded with cash on hand. The transaction is subject to customary closing conditions and is expected to close in the first quarter of 2025.
Added
In the fourth quarter of 2025, the Company committed to certain organizational changes designed to generate cost efficiencies while better aligning our organizational structure with the Company’s long-term growth strategy (collectively referred to as the “2025 Productivity Plan”).
Removed
To the extent applicable, segment operating income excludes Amortization of intangible assets, Acquisition and integration costs, Exit and restructuring costs, as well as certain other non-recurring costs (such as the Settlement costs in 2022, impairment of goodwill and other intangibles, and business acquisition purchase accounting adjustments).
Added
We expect annualized pre-tax operating costs savings of at least $20 million from these actions, net of re-investment into advancing the Company’s AI product portfolio, reorganizing our sales force, and absorbing increased employee-related costs. Acquisitions: On September 30, 2025, the Company acquired Elo Holdings, Inc. (“Elo”) for $1,303 million in cash, net of cash on hand.
Removed
The Company has 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 December 31, 2024, the Term Loan A interest rate was 5.71%.
Added
Elo is an innovator of solutions that engage customers, enhance self-service, and accelerate automation across a wide range of end 30 Table of Contents markets. The Elo acquisition expands our portfolio of self-service and consumer-facing workflow offerings. The operating results of Elo are included in the CF segment.
Removed
Interest payments are made monthly and are subject to variable rates plus an applicable margin. Senior Notes In the second quarter of 2024, the Company completed a private offering of $500 million senior unsecured notes (the “Senior Notes”) with a 6.5% fixed interest rate.
Added
On February 28, 2025, the Company acquired Photoneo for approximately $62 million in cash. Photoneo is a leading developer and manufacturer of 3D machine vision offerings. The Photoneo acquisition complements and expands our machine vision offerings across several industries. The operating results of Photoneo are included in the AVA segment.
Removed
The net proceeds of the issuance, after deducting debt issuance costs which were deferred, were approximately $492 million. The Senior Notes mature on June 1, 2032, and interest is payable semi-annually in arrears in June and December of each year, commencing on December 1, 2024.
Added
Current year Operating expenses were higher than the prior year primarily due to higher employee and employee-related costs, the inclusion of operating expenses and higher acquisition and integration costs associated with recently acquired companies, and higher exit and restructuring costs primarily driven by the planned divestiture of our robotics automation solutions business.
Removed
The Company 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. The Senior Notes are fully and unconditionally guaranteed on a senior unsecured basis by certain of Zebra’s existing and future subsidiaries.
Added
The higher employee and employee-related costs in the current year include higher share-based compensation costs, primarily driven by changes made in the current year to the timing of the annual grant and eligibility provisions as well as improved expected attainment associated with performance-based awards.
Removed
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.
Added
Total other expense, net, increased primarily due to non-recurring interest rate swap gains in the prior year and foreign exchange transaction losses in the current year, partly offset by lower net interest costs associated with the Company’s borrowings driven by rate favorability and higher interest income on cash equivalents in the current year.
Removed
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 December 31, 2024, the Company had letters of credit totaling $10 million, which reduced funds available for borrowings under the Revolving Credit Facility from $1,500 million to $1,490 million.
Added
The increase in the effective tax rate compared to the prior year was primarily due to increased taxes related to foreign earnings subject to U.S. taxation as a result of 2025 U.S tax legislation, lower share-based compensation deductions, increased reserves for uncertain tax positions, and U.S. state income taxes, partly offset by the generation of U.S. and Canadian tax credits and the release of certain Canadian valuation allowance reserves.
Removed
As of December 31, 2024, the Revolving Credit Facility had an average interest rate of 5.68%. Upon borrowing, interest payments are made monthly and are subject to variable rates plus an applicable margin. The Revolving Credit Facility matures on May 25, 2027.
Added
(2) For purposes of computing Organic Net sales growth, amounts directly attributable to the acquisition of Elo are excluded for twelve months following the September 30, 2025 acquisition date. (3) CF Organic Net sales growth is a non-GAAP financial measure.
Removed
Receivables Financing Facility As of December 31, 2024, 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.
Added
Gross margin decreased to 47.2% in the current year compared to 49.2% in the prior year primarily due to unfavorable impacts of tariffs, net of mitigating actions, and lower services and software margins, partly offset by volume leverage favorability.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeItem 7A. Quantitative and Qualitative Disclosures About Market Risk Market risk is the sensitivity of income to changes in interest rates, commodity prices, and foreign currency changes. Zebra is primarily exposed to the following types of market risk: interest rate and foreign currency. Interest Rate Risk We are exposed to interest rate volatility with regard to existing debt issuances.
Biggest changeItem 7A. Quantitative and Qualitative Disclosures About Market Risk Zebra is primarily exposed to the following types of market risk: interest rate and foreign currency. Interest Rate Risk We are exposed to interest rate volatility with regard to existing debt issuances. Our exposure is primarily tied to the Secured Overnight Financing Rate (“SOFR”).
See Note 11, Derivative Instruments in the Notes to Consolidated Financial Statements for further discussions of hedging activities. The currencies that we are primarily exposed to fluctuations in foreign currency exchange rates are the Euro, British Pound Sterling, and Czech Koruna. A one percentage point increase or decrease in exchange rates relative to the U.S.
See Note 11, Derivative Instruments in the Notes to Consolidated Financial Statements for further discussions of derivative and hedging activities. The currencies that we are primarily exposed to fluctuations in foreign currency exchange rates are the Euro, British Pound Sterling, and Czech Koruna. A one percentage point increase or decrease in exchange rates relative to the U.S.
A one percentage point increase or decrease in interest rates would increase or decrease annual interest expense by approximately $17 million. Refer to Note 11, Derivative Instruments in the Notes to Consolidated Financial Statements for further discussion of these risk mitigation activities.
A one percentage point increase or decrease in interest rates would increase or decrease annual interest expense by approximately $20 million. Refer to Note 11, Derivative Instruments in the Notes to Consolidated Financial Statements for further discussion of these risk mitigation activities.
Exposure to variable interest may increase or decrease, to the extent that the Company’s borrowings under its debt facilities increase or decrease, respectively. Foreign Exchange Risk We provide offerings in approximately 176 countries throughout the world and, therefore, at times are exposed to risk based on movements in foreign exchange rates.
Exposure to variable interest may increase or decrease, to the extent that the Company’s borrowings under its debt facilities increase or decrease, respectively. Foreign Currency Risk We provide offerings in approximately 179 countries throughout the world and, therefore, at times are exposed to risk based on movements in foreign exchange rates.
Generally, under these interest rate swaps, we agree with a counterparty to exchange variable rate for fixed rate interest amounts with an agreed upon notional amount. As of December 31, 2024, approximately $1.7 billion of our $2.2 billion of total debt outstanding had interest determined by reference to a variable rate index.
Generally, under these interest rate swaps, we agree with a counterparty to exchange variable rate for fixed rate interest amounts with an agreed upon notional amount. As of December 31, 2025, approximately $2.0 billion of our $2.5 billion of total debt outstanding had interest determined by reference to a variable rate index.
Dollar would increase or decrease our pre-tax income by approximately $1 million. This amount is inclusive of the impact of associated derivative contracts. 39 Table of Contents
Dollar would increase or decrease our pre-tax income by approximately $2 million. This amount is inclusive of the impact of associated derivative contracts. 40 Table of Contents
Removed
Our exposure is primarily tied to the Secured Overnight Financing Rate (“SOFR”).

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