Zebra Technologies Corporation (NASDAQ:ZBRA) Q2 2020 Earnings Conference Call - Final Transcript

Jul 28, 2020 • 08:30 am ET

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Zebra Technologies Corporation (NASDAQ:ZBRA) Q2 2020 Earnings Conference Call - Final Transcript

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Presentation
Operator
Operator

Good day, and welcome to the Second Quarter 2020 Zebra Technologies Earnings Conference Call. [Operator Instructions]. Please note, this event is being recorded.

I would now like to turn the conference over to Mike Steele, Vice President, Investor Relations. Please go ahead

Executive
Michael A. Steele

Good morning. Thank you for joining us today. Before we begin, I need to inform you that certain statements made on this call are forward-looking and subject to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These statements are based on current expectations and assumptions and are subject to risks and uncertainties. Actual results could differ materially due to the factors discussed in our filings with the Securities and Exchange Commission. During this call, we will make reference to non-GAAP financial measures as we describe our business performance. You can find reconciliations of our GAAP to non-GAAP results in today's earnings press release and at the end of the slide presentation. This presentation will include prepared remarks from Anders Gustafsson, our Chief Executive Officer; and Olivier Leonetti, our Chief Financial Officer. Anders will begin with our second quarter results, then Olivier will provide additional detail on the financials and discuss our outlook. Anders will conclude with progress on advancing our Enterprise Asset Intelligence vision and trends we are seeing in our end markets. Following the prepared remarks, Joe Heel, our Senior Vice President of Global Sales, will join us as we take your questions. Also, throughout this presentation, unless otherwise indicated, our references to sales growth are year-over-year on a constant currency basis and exclude results from recently acquired businesses for the 12 months following each acquisition. This presentation is being simulcast on our website at investors.zebra.com, and will be archived there for at least one year.

Now I'll turn the call over to Anders.

Executive
Anders Gustafsson

Thank you, Mike. Good morning, everyone, and thank you for joining us. First, I would like to emphasize that our top priority continues to be the health and well-being of our employees, customers and partners. I am particularly grateful for all of the frontline workers, including medical professionals, who continue to serve our communities and keep us safe. Zebra and many of our customers' workplaces have commenced reopening plans, and I am very proud of the ability of our teams to effectively serve our customers and partners while working remotely through the peak of the pandemic. In Q2, our teams remained agile and executed very well through the pandemic. It has been inspiring for me to see our employees rally to keep the business and each other moving forward. Although the financial results we published this morning reflect a challenging second quarter environment as we navigated through the peak of the crisis, Zebra's longer-term prospects have strengthened as secular trends to digitize and automate workflows have accelerated with the pandemic. In Q2, we realized a net sales decline of 12%; adjusted EBITDA margin of 18.3%, which contracted by 290 basis points; and non-GAAP diluted earnings per share of $2.41,