Zebra Technologies (ZBRA) 8-K Zebra Technologies Announces Record Sales for Fourth Quarter of 2006

Exhibit 99.1

FOR IMMEDIATE RELEASE

Zebra Technologies Announces Record Sales for Fourth Quarter of 2006

Company achieves strong growth and record sales in North America;

Results include reserve for insurance receivable

Vernon Hills, IL, February 14, 2007—Zebra Technologies Corporation (NASDAQ: ZBRA) today announced that net sales increased 17.1% for the quarter ended December 31, 2006, to a record $209,903,000, compared with $179,294,000 for the same period a year ago. Net income for the period was $21,446,000, or $0.30 per diluted share, including a pretax charge of $12,543,000 for the reserve of an insurance receivable. This charge reduced 2006 fourth quarter diluted earnings by $0.12 per share. For the fourth quarter a year ago, net income was $26,845,000, or $0.38 per diluted share. Results for 2005 were restated to reflect the adoption of SFAS 123(R),Share-Based Payments.

“Zebra’s strong growth across all areas of our business benefited from programs to extend global reach and serve high-growth vertical markets with robust solutions,” stated Edward Kaplan, Zebra’s chairman and chief executive officer. “We enter 2007 with great optimism for further growth. We have continued favorable momentum in our core business, supported by increasing traction of recently introduced products. On top of this, our entry into real time locating systems (RTLS) with the acquisition of WhereNet in January adds another dimension of growth, access to active RFID and opportunity to build value for stockholders.”

Discussion and Analysis

For the fourth quarter of 2006 compared with the fourth quarter of 2005:

· High sales growth spanned geographies, products and channels. The North America, Latin America and EMEA regions achieved new quarterly sales records. Hardware sales increased 18.3%. Supplies sales increased 14.9%.

· Gross profit margin declined to 46.9% from 50.0%. During the quarter, profitability was affected by higher material costs, adjustments to inventory reserves, and labor and overhead charges related to the start-up of new and expanded label conversion facilities in three locations.

· The company took a pre-tax charge of $12,543,000 for the reserve of an insurance receivable that was related to the debt of a reseller customer. This debt was guaranteed by an insurance company doing business in the U.K. that defaulted on its guaranty obligation. Zebra has initiated legal action against the insurance company to enforce the guaranty.

· Higher personnel costs from increased staffing to support planned growth, and increased expenditures on activities in information systems also contributed to growth in operating expenses.

For the full year of 2006, the company had net sales of $759,524,000, up 8.2% from $702,271,000 for 2005. Annual net income was $70,946,000, or $1.00 per diluted share. Results include the settlement and license with Paxar Americas, Inc., that was recognized in the third quarter, as well as the receivable reserve in the fourth quarter. For 2005, net income was $106,184,000, or $1.47 per diluted share.

At December 31, 2006, Zebra had $559,189,000 in cash and investments, and no long-term debt. Net inventories were $81,190,000, and accounts receivable, net, were $122,540,000.

The company also announced that during the fourth quarter, it purchased 1.9 million shares of Zebra common stock against the 2.5 million shares authorized by Zebra’s Board of Directors. To date, Zebra has purchased 2.1 million shares under the current authorization.

First Quarter Outlook

Zebra also announced its financial forecast for the first quarter of 2007. Net sales are expected within a range of $195,000,000 and $205,000,000. Earnings are expected within a range of $0.33 and $0.37 per diluted share.

Forward-looking Statement

This press release contains forward-looking statements, as defined by the Private Securities Litigation Reform Act of 1995, including, without limitation, the statements regarding the company’s financial forecast for the first quarter of 2007 stated in the paragraph directly above. Actual results may differ from those expressed or implied in the company’s forward-looking statements. These statements represent estimates only as of the date they were made. Zebra may elect to update forward-looking statements but expressly disclaims any obligation to do so, even if the company’s estimates change.

These forward-looking statements are based on current expectations, forecasts and assumptions and are subject to the risks and uncertainties inherent in Zebra’s industry, market conditions, general domestic and international economic conditions, and other factors. These factors include market conditions in North America and other geographic regions and market acceptance of Zebra’s printer and software products and competitors’ product offerings and the potential effects of technological changes. Other factors include U.S. and foreign regulations that pertain to electrical and electronic equipment, including European Union directives relating to the collection, recycling, treatment and disposal of products and the reduction or elimination of certain specified materials in such products. Zebra’s failure to comply with these regulations may subject Zebra to penalties, prevent Zebra from selling its products in a certain country, or increase the cost of supplying the products. Profits and profitability will be affected by the company’s ability to control manufacturing and operating costs. Because of a large investment portfolio, interest rates and financial market conditions will also have an impact on results. Foreign exchange rates will have an effect on financial results because of the large percentage of our international sales. The outcome of litigation in which Zebra is involved, and particularly litigation or claims related to alleged infringement of third-party intellectual property rights, is another factor. In addition, the acquisitions of Swecoin, which was completed in October 2006, and WhereNet, which was completed in January 2007, have risks relating to integrating these companies’ businesses and operations with Zebra’s. These and other factors could have an adverse effect on Zebra’s revenues, gross profit margins and results of operations and increase the volatility of our financial results. When used in this release and documents referenced, the words “anticipate,” “believe,” “estimate,” and “expect” and similar expressions, as they relate to the company or its management are intended to identify such forward-looking statements, but are not the exclusive means of identifying these statements. Descriptions of the risks, uncertainties and other factors that could affect the company’s future operations and results can be found in Zebra’s filings with the Securities and Exchange Commission. In particular, readers are referred to Zebra’s Form 10-K for the year ended December 31, 2005, and the Risk Factors in Zebra’s Form 10-Q for the quarter ended September 30, 2006.

Zebra Technologies Corporation delivers innovative and reliable on-demand printing solutions for business improvement and security applications in 100 countries around the world. More than 90 percent of Fortune 500 companies use Zebra-brand printers. A broad range of applications benefit from Zebra-brand thermal bar code, “smart” label, receipt, and card printers, resulting in enhanced security, increased productivity, improved quality, lower costs, and better customer service. The company has sold more than 5 million printers, including passive RFID printer/encoders, wireless mobile solutions, and active RFID systems, as well as ZebraDesigner label formatting software, ZebraLink connectivity solutions, Genuine Zebra supplies and ZebraCare services and support. Information about Zebra bar code, card and RFID products can be found at http://www.zebra.com.

Investors are invited to listen to a live Internet broadcast of Zebra’s conference call discussing the company’s financial results for the fourth quarter of 2006. The conference call will be held at 11:00 Eastern Time today. To listen to the call, visit the company’s Web site at http://www.zebra.com.

For Information, Contact:

Charles R. Whitchurch

Chief Financial Officer

Phone: 847.634.6700

Fax: 847.821.2545

ZEBRA TECHNOLOGIES CORPORATION

CONSOLIDATED BALANCE SHEETS

(Amounts in thousands)

(Unaudited)

	December 31, 2006			December 31, 2005
				(Restated)
ASSETS
Current assets:
Cash and cash equivalents	$	41,014		$	25,621
Investments and marketable securities		219,930			518,618
Accounts receivable, net		122,540			111,551
Inventories, net		81,190			63,638
Deferred income taxes		9,464			8,188
Prepaid expenses		5,552			5,098
Total current assets		479,690			732,714
Property and equipment at cost, less accumulated depreciation and amortization		57,431			49,643
Long-term deferred income taxes		11,917			6,216
Goodwill		70,714			69,097
Other intangibles, net		34,025			19,002
Long-term investments and marketable securities		298,245			—
Other assets		11,120			41,743
Total assets	$	963,142		$	918,415
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	28,980		$	24,885
Accrued liabilities		43,191			26,740
Income taxes payable		2,683			535
Total current liabilities		74,854			52,160
Deferred rent		638			574
Other long-term liabilities		9,969			7,709
Total liabilities		85,461			60,443
Stockholders’ equity:
Preferred Stock		—			—
Class A Common Stock		722			722
Additional paid-in capital		139,083			139,433
Treasury stock		(119,335	)		(64,013	)
Retained earnings		850,399			779,453
Accumulated other comprehensive income		6,812			2,377
Total stockholders’ equity		877,681			857,972
Total liabilities and stockholders’ equity	$	963,142		$	918,415

Note: Figures for December 31, 2005, were restated for the adoption of SFAS 123 (R),Share-Based Payments, using the modified retrospective approach.

ZEBRA TECHNOLOGIES CORPORATION

CONSOLIDATED STATEMENTS OF EARNINGS (LOSS)

(Amounts in thousands, except per share data)

(Unaudited)

	Three Months Ended						Twelve Months Ended
	December 31, 2006			December 31, 2005			December 31, 2006			December 31, 2005
				(Restated)						(Restated)
Net sales	$	209,903		$	179,294		$	759,524		$	702,271
Cost of sales		111,493			89,682			401,104			348,851
Gross profit		98,410			89,612			358,420			353,420
Operating expenses:
Selling and marketing		27,702			25,725			96,788			91,630
Research and development		12,768			12,103			48,959			47,359
General and administrative		18,284			14,816			62,656			64,050
Amortization of intangible assets		1,394			798			3,653			2,341
Reserve for insurance receivable		12,543			—			12,543			—
Litigation settlement		—			—			53,392			—
Exit costs		—			71			—			2,012
Total operating expenses		72,691			53,513			277,991			207,392
Operating income		25,719			36,099			80,429			146,028
Other income (expense):
Investment income		6,980			3,814			23,182			13,417
Interest expense		(16	)		(8	)		(252	)		(79	)
Foreign exchange gains (losses)		(822	)		87			(635	)		1,286
Other, net		(170	)		(74	)		(1,082	)		(370	)
Total other income		5,972			3,819			21,213			14,254
Income before income taxes and cumulative effect of accounting change		31,691			39,918			101,642			160,282
Income taxes		10,245			13,073			32,015			54,098
Income before cumulative effect of accounting change		21,446			26,845			69,627			106,184
Cumulative effect of accounting change (net of tax effect of $694)		—			—			1,319			—
Net income	$	21,446		$	26,845		$	70,946		$	106,184
Basic earnings (loss) per share before cumulative effect of accounting change	$	0.31		$	0.38		$	0.99		$	1.49
Diluted earnings (loss) per share before cumulative effect of accounting change	$	0.30		$	0.38		$	0.98		$	1.47
Basic earnings (loss) per share	$	0.31		$	0.38		$	1.01		$	1.49
Diluted earnings (loss) per share	$	0.30		$	0.38		$	1.00		$	1.47
Basic weighted average shares outstanding		70,108			70,385			70,516			71,364
Diluted weighted average and equivalent shares outstanding		70,499			70,940			70,956			72,000

Note: Figures for the three months and twelve months ended December 31, 2005, were restated for the adoption of SFAS 123 (R),Share-Based Payments, using the modified retrospective approach.

ZEBRA TECHNOLOGIES CORPORATION

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Amounts in thousands)

(Unaudited)

	Twelve Months Ended
	December 31, 2006			December 31, 2005
					(Restated)
Cash flows from operating activities:
Net income	$	70,946		$	106,184
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		16,087			13,104
Stock-based compensation		7,540			8,183
Excess tax benefit from share-based compensation		(1,704	)		(2,258	)
Cumulative effect of accounting change (net of tax)		(1,319	)		—
Insurance receivable reserve		12,543			—
Deferred income taxes		(6,737	)		(2,053	)
Changes in assets and liabilities:
Accounts receivable, net		(4,292	)		(20,422	)
Inventories		(13,430	)		(6,204	)
Other assets		(296	)		(8,383	)
Accounts payable		(1,869	)		3,792
Accrued liabilities		8,559			(1,992	)
Income taxes payable		2,586			(2,900	)
Other operating activities		(552	)		3,421
Net cash provided by operating activities		88,062			90,472
Cash flows from investing activities:
Purchases of property and equipment		(19,197	)		(14,286	)
Acquisition of businesses acquired, net of cash acquired		(2,681	)		(7,797	)
Acquisition of intangible assets		(18,091	)		(13,754	)
Purchases of investments		(1,110,472	)		(1,021,813	)
Maturities of investments		757,249			673,466
Sales of investments		374,666			359,711
Net cash used in investing activities		(18,526	)		(24,473	)
Cash flows from financing activities:
Purchase of treasury stock		(68,221	)		(70,421	)
Proceeds from exercise of stock options and stock purchase plan purchases		10,402			11,753
Excess tax benefit from share-based compensation		1,704			2,258
Payments for obligation under capital lease		—			(171	)
Net cash used in financing activities		(56,115	)		(56,581	)
Effect of exchange rate changes on cash		1,972			(1,780	)
Net increase in cash and cash equivalents		15,393			7,638
Cash and cash equivalents at beginning of period		25,621			17,983
Cash and cash equivalents at end of period	$	41,014		$	25,621
Supplemental disclosures of cash flow information:
Interest paid	$	252		$	79
Income taxes paid		33,070			61,453
Supplemental disclosures of non-cash transactions:
Purchase of treasury shares not paid in 2006	$	4,704			—

Note: Figures for the twelve months ended December 31, 2006, were restated for the adoption of SFAS 123 (R),Share-Based Payments, using the modified retrospective approach.

ZEBRA TECHNOLOGIES CORPORATION

SUPPLEMENTAL SALES INFORMATION

(Amounts in thousands)

(Unaudited)

Sales by Product Category

	Three Months Ended
	Dec. 31, 2006			Dec 31, 2005		Percent Change	Percent of Total Sales
Hardware	$	163,081		$	137,803	18.3	77.7
Supplies		38,578			33,581	14.9	18.4
Service and software		6,954			6,202	12.1	3.3
Shipping and handling		1,610			833	93.3	0.8
Cash flow from hedging activities		(320	)		875	NM	(0.2	)
Total sales	$	209,903		$	179,294	17.1	100.0
Sales by Product Category
	Twelve Months Ended
	Dec. 31, 2006			Dec. 31, 2005		Percent Change	Percent of Total Sales
Hardware	$	578,002		$	540,679	6.9	76.1
Supplies		150,709			129,183	16.7	19.8
Service and software		25,664			25,217	1.8	3.4
Shipping and handling		6,022			5,575	8.0	0.8
Cash flow from hedging activities		(873	)		1,617	NM	(0.1	)
Total sales	$	759,524		$	702,271	8.2	100.0
Sales by Geographic Region
	Three Months Ended
	Dec. 31, 2006			Dec. 31, 2005		Percent Change	Percent of Total Sales
Europe, Middle East and Africa	$	73,109		$	59,942	22.0	34.8
Latin America		13,854			12,923	7.2	6.6
Asia-Pacific		18,054			15,867	13.8	8.6
Total international		105,017			88,732	18.4	50.0
North America		104,886			90,562	15.8	50.0
Total sales	$	209,903		$	179,294	17.1	100.0
Sales by Geographic Region
	Twelve Months Ended
	Dec. 31, 2006			Dec. 31, 2005		Percent Change	Percent of Total Sales
Europe, Middle East and Africa	$	260,125		$	230,365	12.9	34.2
Latin America		53,619			46,878	14.4	7.1
Asia-Pacific		65,960			62,974	4.7	8.7
Total international		379,704			340,217	11.6	50.0
North America		379,820			362,054	4.9	50.0
Total sales	$	759,524		$	702,271	8.2	100.0