Zebra Technologies (ZBRA) 8-K Unaudited Pro Forma Financial Statements

Exhibit 99.1

UNAUDITED PRO FORMA FINANCIAL STATEMENTS

The following unaudited pro forma consolidated financial statements of Zebra Technologies Corporation (“Zebra”) have been prepared to reflect the disposition on March 18, 2011 of Navis Holdings LLC (“Navis”), as described in Item 2.01 of Zebra’s Current Report on Form 8-K dated January 28, 2011. In addition, the Pro forma Financial Statements reflect the impact of discontinuing other immaterial Zebra operations which will be classified as discontinued as of January 28, 2011.

Zebra’s unaudited pro forma consolidated statements of earnings for the fiscal years ended December 31, 2010, 2009 and 2008 are based on Zebra’s historical consolidated statements of earnings, and give effect to the disposition and discontinuance of operations as if it had occurred on January 1, 2008. The anticipated non-recurring after tax gain on the disposition is not reflected in the unaudited pro forma consolidated statements of earnings. The unaudited pro forma consolidated balance sheet as of December 31, 2010 is based on Zebra’s historical balance sheet as of December 31, 2010.

The unaudited pro forma consolidated financial statements presented below are based upon assumptions and adjustments described in the accompanying notes and do not reflect any adjustments of non-recurring items, overhead and administrative expense reductions, or changes in operating strategies arising as a result of the disposition. The sales and expenses related to the WhereNet Marine Terminal Solution software product line that was sold as part of the disposition above are included in Zebra’s results of continuing operations for all periods presented in accordance with the appropriate accounting guidance. Zebra’s management believes that the assumptions used and the adjustments made in this presentation are reasonable under the circumstances and given the information available.

These unaudited pro forma consolidated financial statements are presented for illustrative purposes only and are not necessarily indicative of the operating results or financial position that would have been achieved had the disposition been consummated as of the dates indicated or of the results that may be obtained in the future. These unaudited pro forma consolidated financial statements and the accompanying notes should be read together with Zebra’s audited consolidated financial statements and accompanying notes, as of and for the fiscal year ended December 31, 2010, and Management’s Discussion and Analysis of Financial Condition and Results of Operations included in Zebra’s Annual Report on Form 10-K for the fiscal year ended December 31, 2010.

ZEBRA TECHNOLOGIES CORPORATION AND SUBSIDIARIES

PRO FORMA CONSOLIDATED BALANCE SHEET

(Amounts in thousands)

(Unaudited)

	December 31, 2010
ASSETS
Current assets:
Cash and cash equivalents	$	46,175
Restricted cash		1,378
Investments and marketable securities		125,567
Accounts receivable, net		130,143
Inventories, net		112,970
Deferred income taxes		15,670
Income taxes receivable		—
Prepaid expenses and other current assets		11,505
Assets of discontinued operations		148,169
Total current assets		591,577
Property and equipment at cost, less accumulated depreciation and amortization		87,093
Long-term deferred income taxes		21,254
Goodwill		79,703
Other intangibles, net		9,755
Long-term investments and marketable securities		85,478
Other assets		4,004
Total assets	$	878,864
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	34,578
Accrued liabilities		65,163
Deferred revenue		8,966
Income taxes payable		5,900
Liabilities of discontinued operations		21,827
Total current liabilities		136,434
Deferred rent		2,207
Other long-term liabilities		10,191
Total liabilities		148,832
Stockholders’ equity:
Preferred Stock		—
Class A Common Stock		722
Additional paid-in capital		129,715
Treasury stock		(462,029	)
Retained earnings		1,070,973
Accumulated other comprehensive loss		(9,349	)
Total stockholders’ equity		730,032
Total liabilities and stockholders’ equity	$	878,864

2

ZEBRA TECHNOLOGIES CORPORATION AND SUBSIDIARIES

PRO FORMA CONSOLIDATED STATEMENTS OF EARNINGS

(Amounts in thousands, except per share data)

(Unaudited)

	For the Year Ended December 31, 2010
	Historical Zebra			Pro Forma Adjustments			Pro Forma Zebra
Net sales:
Net sales of tangible products	$	855,269		$	(5,739	)	$	849,530
Revenue from services and software		101,579			(56,750	)		44,829
Total net sales		956,848			(62,489	)		894,359
Cost of sales:
Cost of sales of tangible products		455,007			(4,437	)		450,570
Cost of services and software		40,972			(18,048	)		22,924
Total cost of sales		495,979			(22,485	)		473,494
Gross profit		460,869			(40,004	)		420,865
Operating expenses:
Selling and marketing		122,689			(10,324	)		112,365
Research and development		101,930			(19,355	)		82,575
General and administrative		79,710			(6,481	)		73,229
Amortization of intangible assets		9,573			(6,362	)		3,211
Litigation settlement		(1,082	)		—			(1,082	)
Exit, restructuring and integration costs		4,197			(1,935	)		2,262
Total operating expenses		317,017			(44,457	)		272,560
Operating income		143,852			4,453			148,305
Other income (expense):
Investment income		2,681			(3	)		2,678
Foreign exchange gain (loss)		(213	)		44			(169	)
Other, net		(1,385	)		268			(1,117	)
Total other income		1,083			309			1,392
Income before income taxes		144,935			4,762			149,697
Income taxes		43,157			1,836			44,993
Income from continuing operations		101,778			2,926			104,704
Loss from discontinued operations, net of tax		—			(2,926	)		(2,926	)
Net income	$	101,778		$	—		$	101,778
Basic earnings per share:
Income from continuing operations	$	1.78					$	1.83
Loss from discontinued operations		—						(0.05	)
Net income	$	1.78					$	1.78
Diluted earnings per share:
Income from continuing operations	$	1.77					$	1.82
Loss from discontinued operations		—						(0.05	)
Net income	$	1.77					$	1.77
Basic weighted average shares outstanding		57,143						57,143
Diluted weighted average and equivalent shares outstanding		57,428						57,428

3

ZEBRA TECHNOLOGIES CORPORATION AND SUBSIDIARIES

PRO FORMA CONSOLIDATED STATEMENTS OF EARNINGS

(Amounts in thousands, except per share data)

(Unaudited)

	For the Year Ended December 31, 2009
	Historical Zebra			Pro Forma Adjustments			Pro Forma Zebra
Net sales:
Net sales of tangible products	$	701,044		$	(4,941	)	$	696,103
Revenue from services and software		102,541			(60,162	)		42,379
Total net sales		803,585			(65,103	)		738,482
Cost of sales:
Cost of sales of tangible products		401,727			(3,411	)		398,316
Cost of services and software		41,137			(18,558	)		22,579
Total cost of sales		442,864			(21,969	)		420,895
Gross profit		360,721			(43,134	)		317,587
Operating expenses:
Selling and marketing		102,535			(10,492	)		92,043
Research and development		86,390			(19,913	)		66,477
General and administrative		81,395			(5,463	)		75,932
Amortization of intangible assets		10,466			(7,512	)		2,954
Exit, restructuring and integration costs		12,191			(2,289	)		9,902
Asset impairment charges		(1,058	)		1,058			—
Total operating expenses		291,919			(44,611	)		247,308
Operating income		68,802			1,477			70,279
Other income (expense):
Investment income		2,933			(2	)		2,931
Foreign exchange gain (loss)		(45	)		(59	)		(104	)
Other, net		(1,167	)		380			(787	)
Total other income		1,721			319			2,040
Income before income taxes		70,523			1,796			72,319
Income taxes		23,419			409			23,828
Income (loss) from continuing operations		47,104			1,387			48,491
Loss from discontinued operations, net of tax		—			(1,387	)		(1,387	)
Net income	$	47,104		$	—		$	47,104
Basic earnings per share:
Income (loss) from continuing operations	$	0.79					$	0.81
Income (loss) from discontinued operations		—						(0.02	)
Net income (loss)	$	0.79					$	0.79
Diluted earnings per share:
Income (loss) from continuing operations	$	0.79					$	0.81
Income (loss) from discontinued operations		—						(0.02	)
Net income (loss)	$	0.79					$	0.79
Basic weighted average shares outstanding		59,306						59,306
Diluted weighted average and equivalent shares outstanding		59,425						59,425

4

ZEBRA TECHNOLOGIES CORPORATION AND SUBSIDIARIES

PRO FORMA CONSOLIDATED STATEMENTS OF EARNINGS (LOSS)

(Amounts in thousands, except per share data)

(Unaudited)

	For the Year Ended December 31, 2008
	Historical Zebra			Pro Forma Adjustments			Pro Forma Zebra
Net sales:
Net sales of tangible products	$	871,587		$	(1,746	)	$	869,841
Revenue from services and software		105,113			(64,889	)		40,224
Total net sales		976,700			(66,635	)		910,065
Cost of sales:
Cost of sales of tangible products		452,208			(1,965	)		450,243
Cost of services and software		45,187			(23,884	)		21,303
Total cost of sales		497,395			(25,849	)		471,546
Gross profit		479,305			(40,786	)		438,519
Operating expenses:
Selling and marketing		126,325			(13,566	)		112,759
Research and development		95,800			(23,095	)		72,705
General and administrative		81,644			(7,798	)		73,846
Amortization of intangible assets		18,575			(7,735	)		10,840
Litigation settlement		(5,302	)		—			(5,302	)
Exit, restructuring and integration costs		20,009			(2,077	)		17,932
Asset impairment charges		157,600			(12,650	)		144,950
Total operating expenses		494,651			(66,921	)		427,730
Operating income (loss)		(15,346	)		26,135			10,789
Other income (expense):
Investment income		1,281			(120	)		1,161
Foreign exchange gain (loss)		3,518			913			4,431
Other, net		(1,366	)		70			(1,296	)
Total other income		3,433			863			4,296
Income before income taxes		(11,913	)		26,998			15,085
Income taxes		26,508			7,624			34,132
Income (Loss) from continuing operations		(38,421	)		19,374			(19,047	)
Loss from discontinued operations, net of tax					(19,374	)		(19,374	)
Net income	$	(38,421	)	$	—		$	(38,421	)
Basic earnings per share:
Loss from continuing operations	$	(0.60	)				$	(0.31	)
Loss from discontinued operations		—						(0.29	)
Net loss	$	(0.60	)				$	(0.60	)
Diluted earnings per share:
Loss from continuing operations	$	(0.60	)				$	(0.31	)
Loss from discontinued operations		—						(0.29	)
Net loss	$	(0.60	)				$	(0.60	)
Basic weighted average shares outstanding		64,524						64,524
Diluted weighted average and equivalent shares outstanding		64,524						64,524

5

ZEBRA TECHNOLOGIES CORPORATION AND SUBSIDIARIES

NOTES TO PRO FORMA FINANCIAL STATEMENTS

(Unaudited)

Note 1 – Discontinued operations

On March 18, 2011, Zebra sold its ownership interest in Navis Holdings, LLC (Navis), a Zebra Enterprise Solutions (ZES) entity, to a third party. The results of operations for Navis and certain other ZES assets are reported pro forma for the periods presented as discontinued operations.

The components of assets and liabilities of discontinued operations in our unaudited pro forma consolidated balance sheet are as follows (in thousands):

	December 31, 2010
Assets:
Cash and cash equivalents	$	1,301
Accounts receivable, net		24,003
Inventories		772
Deferred income taxes		3,492
Prepaid expenses and other current assets		3,328
Property and equipment, net		1,890
Goodwill		72,230
Other intangibles, net		39,951
Other assets		1,202
Assets of discontinued operations	$	148,169
Liabilities:
Accounts payable	$	726
Accrued liabilities		2,927
Deferred revenue	��	17,791
Deferred rent		199
Other long-term liabilities		184
Liabilities of discontinued operations	$	21,827

Summary results of operations for Navis reflected as discontinued operations in our unaudited pro forma consolidated statement of earnings for the years ended are as follows (in thousands):

	Year Ended
	December 31, 2010			December 31, 2009			December 31, 2008
Net sales	$	62,489		$	65,103		$	66,635
Loss before income tax	$	(4,762	)	$	(1,796	)	$	(26,998	)
Income tax benefit		(1,836	)		(409	)		(7,624	)
Loss from discontinued operations	$	(2,926	)	$	(1,387	)	$	(19,374	)

6

ZEBRA TECHNOLOGIES CORPORATION AND SUBSIDIARIES

PRO FORMA CONSOLIDATED STATEMENTS OF EARNINGS BY QUARTER FOR 2010

(Amounts in thousands, except per share data)

(Unaudited)

	Quarter Ended
	April 3, 2010			July 3, 2010			Oct. 2, 2010			Dec. 31, 2010
Net sales:
Net sales of tangible products	$	201,463		$	207,748		$	218,271		$	222,048
Revenue from services and software		10,512			10,810			11,536			11,971
Total net sales		211,975			218,558			229,807			234,019
Cost of sales:
Cost of sales of tangible products		109,075			114,081			114,924			112,490
Cost of services and software		5,137			5,068			5,636			7,083
Total cost of sales		114,212			119,149			120,560			119,573
Gross profit		97,763			99,409			109,247			114,446
Operating expenses:
Selling and marketing		24,673			27,682			28,068			31,942
Research and development		18,324			20,653			21,862			21,736
General and administrative		19,318			17,955			18,147			17,809
Amortization of intangible assets		741			740			839			891
Litigation settlement		—			—			—			(1,082	)
Exit, restructuring and integration costs		1,766			466			—			30
Asset impairment charges		—			—			—			—
Total operating expenses		64,822			67,496			68,916			71,326
Operating income		32,941			31,913			40,331			43,120
Other income (expense):
Investment income		842			634			635			567
Foreign exchange gain (loss)		168			424			(148	)		(613	)
Other, net		(270	)		(455	)		(160	)		(232	)
Total other income (expense)		740			603			327			(278	)
Income before income taxes		33,681			32,516			40,658			42,842
Income taxes		8,134			10,331			13,411			13,117
Income from continuing operations		25,547			22,185			27,247			29,725
Income (loss) from discontinued operations, net of tax		(814	)		492			(1,096	)		(1,508	)
Net income	$	24,733		$	22,677		$	26,151		$	28,217
Basic earnings per share:
Income from continuing operations	$	0.44		$	0.38		$	0.48		$	0.53
Income (loss) from discontinued operations		(0.01	)		0.01			(0.02	)		(0.03	)
Net income	$	0.43		$	0.39		$	0.46		$	0.50
Diluted earnings per share:
Income from continuing operations	$	0.44		$	0.38		$	0.48		$	0.53
Income (loss) from discontinued operations		(0.02	)		0.01			(0.02	)		(0.03	)
Net income	$	0.42		$	0.39		$	0.46		$	0.50
Basic weighted average shares outstanding		58,016			57,489			56,739			56,332
Diluted weighted average and equivalent shares outstanding		58,265			57,737			56,998			56,692

7

Summary results of operations for Navis reflected as discontinued operations in our unaudited pro forma consolidated statement of earnings by quarter for 2010 are as follows (in thousands):

	Quarter Ended
	April 3, 2010			July 3, 2010		Oct. 2, 2010			Dec. 31, 2010
Net sales	$	14,456		$	17,176	$	16,701		$	14,156
Income (loss) before income tax	$	(1,269	)	$	833	$	(1,707	)	$	(2,619	)
Income tax expense (benefit)		(455	)		341		(611	)		(1,111	)
Income (loss) from discontinued operations	$	(814	)	$	492	$	(1,096	)	$	(1,508	)