ZBRA - Earnings call transcript Q4 2018 | Zebra Technologies Corporation

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Good day, and welcome to the Fourth Quarter and Full Year 2018 Zebra Technologies Earnings Conference Call. All participants will be in listen-only mode. [Operator Instructions] Please note this event is being recorded. I would now like to turn the conference over to Mike Steele, Vice President of Investor Relations. Please go ahead.

Mike Steele

morning. Good joining for today. us you Thank

of I Before and These certain to based expectations our and filings inform Actual risks Litigation uncertainties. provisions that are to to assumptions made in on we current are factors could the Act discussed on differ and Exchange XXXX. Harbor subject begin, statements and this you with forward-looking Securities results and materially statements need Commission. call Securities of Private the Safe Reform subject are the due to

we to During our this make will call, performance. we non-GAAP reference financial measures as business describe

our Anders remarks Chief progress can more press discuss Anders Executive quarter Chief GAAP conclude Anders and discussing and release then our our to on Gustafsson, will highlights. the Olivier by our reconciliations the the fourth begin provide Officer; strategic Olivier priorities. financials earnings Leonetti, at on prepared today's and of end in presentation Zebra's will from outlook. You detail and This find Financial full-year slide our will non-GAAP XXXX of presentation. made results include Officer. with will

will your presentation presentation, on there a will archived to Following This Joe of Also, on Sales, acquired Senior being we is constant one investors.zebra.com be are business. currency Heel, least basis Technologies year-over-year simulcast join and and website growth sales unless this exclude recently questions. results from for Xplore the take year. us our Vice at at the Global throughout otherwise indicated, as references President our remarks, prepared our

Anders. over I'll Now, call turn the to

Anders Gustafsson

us. and everyone, morning, you Good joining for Mike. you, Thank thank

across business per Sales, margin, well lead extended exceptional driving and exceeded delivered fourth earnings We in team quarter the strong profitable all and outlook. executed growth the our Our market. share EBITDA our results.

or sales our point and America, Pacific We data cash We mobile improvement; across direct supplies say our of Slide and adjusted in growth EPS are non-GAAP major service double a we XXX-basis of $XXX $X.XX, capture, organic on of business, sales Demand net flow and growth including including categories, in manufacturing, and increase on healthcare, retail product to year-over-year Latin of from nearly our achieved each XX.X%, special was We computing, and can digit and channel Asia free EBITDA and year; services. of you grew support from pleased margin through prior solid performance report a X% e-commerce. printing, particular strength customers. XX% see XX% strong an As X, basis; diluted the America. and the North million.

QX results record margin, cap organic performance Our of EBITDA and financial full-year million adjusted sales free XX% cash $XXX an growth, XX.X% flow. of outstanding

build to sustainable on people, investing a our leading in industry and drive to continue our offerings We technology operations, by growth.

our supported strong the have by to Olivier, turn momentum now We With will XXXX, pipeline to and order call to and outlook. our financial backlog of review I our XXXX discuss results opportunities. entering that, over

Olivier Leonetti

Thank you, Anders.

walk the a with begin us Let through P&L.

to demand translated solid segment mobile Mobility growth led see sales & increased which in XX.X% and before our the across segments currencies impacts on organic the X, saw and regions. especially by products. Enterprise all of computing each and reporting strong XX.X%, data Visibility in capture X.X% of can grew We you sales fourth Slide on net in As an quarter, basis acquisitions.

& Intelligence sales increased X.X%. segment Asset Tracking

capture, Asia-Pacific mobile service product supplies. across computing up mid-sized strength e-commerce, categories. major healthcare, Sales X% retail double-digit and America capture, driven growth and grew sales across our data by We Sales saw mobile and particular was relative manufacturing. growth strength increased our printing in XX%, strength XX% accounts exceptional. with EMEA were data to to regions. computing, in printing North and small region categories. Turning sales with and and in our

printing XXXX, exchange mix shift points period increase XX from business or and business XX.X%, improvement net grew favorable XX%. foreign and the million margin in saw driven countries a margin sub-regions political profit business increased to expense, EVM segment, reflecting XXX-basis favorable adjusted XXX Adjusted digits the strength improved the gross most as mid-single due of stabilized. sales compensation Adjusted in by conditions Adjusted execution, was as increased $XX increased Fourth prior primarily incentive a basis operating expenses in gross including XX% sales All performance. We China our points, particular higher currency basis economic double-digits. period. impacts. Latin percentage America Our prior solutions. grew increased go-to-market grew, point and Brazil. quarter continued EBITDA from year

addition EBITDA from our margin In earnings debt a diluted interest and XX% decreased increase. cost tax share non-GAAP rate drove to lower to year-over-year restructurings $X.XX, expansion, per the

$XXX we acquisition cash $X.X million. and terms as year free We in to Turning sheet. balance invest sheet compared exceptional the The reduced lower to continue in by on increase us the X past capital highlights flow EBITDA adjusted in on integration our XXXX, balance to million approximately down year-end. to profitability, XXXX paid of working management. leaving the driven to principal ratio to Slide now of million times flow cost, ended supported this $XXX flow of debt X. the billion business. year X.X cash was the shows operating and and leverage well-position ratio $XXX cash by the by net Slide strong X.X with free debt path debt primarily as We In increased of

X.X times. additional flexibility range the times We have of the to expands net our debt end lower [indiscernible] allow updated range for X.X by be in for structure. our capital target This to leverage to between

XXXX end solutions. our a turn outlook Slide We order and with of on for to our us X. entered Let demand strong leading portfolio solid backlog market

approximately from changes. Xplore QX believe percentage between expect assumes to would in period. currency year acquisition EBITDA operating net assumes in and X approximately $X.XX positive by QX X%, Non-GAAP XXXX be favorable negative range the sales We is approximately compared Technologies XXXX point impact diluted X.X X offset expense and $X.XX. to from be EPS gross We an prior which be margin lower X% as growth which margin the point the percentage impact of XX%, gross expected of to adjusted to to especially leverage margin foreign

EBITDA net business. XXXX to sales to full-year million. exceed which XX We higher will point impact $XXX X% in of positive expect we from that adjusted expected is the believe be XX%, Currency negative an impact operating flow cash acquisition Foreign XXXX as Xplore the be than leverage Full-year from between X to We changes. point free from full-year growth drive XXXX approximately basis slightly percentage and improvement an and approximately margin X%, from assumes continue XXXX

we are We a XXXX, of assuming working expect be outlook modest to a to unlike been certain use components and XXXX, from that that and than address a in that that situation products, drive the on types we capital will It’s level XXXX tariff accessories, freed enacted teams to of date. XXXX. assumes have working our source Also cash and higher EBITDA China. been our diligently note have

With Corporation, $XX $X.XX call Slide the Temptime’s moments. discuss discuss complete EPS I accretion. to generate Anders full-year does acquisition of results Note the our assumptions of projected priorities. transaction sales a quarter. to You Temptime annualized recently million. will include adjusted soon The XXXX will expect not on our modeling acquisition that we XXXX from Anders progress announced to that any this $X.XX can annualized outlook a is expected turn approximately to on back acquisition few see that, exceeded other in to the X. strategic

Anders Gustafsson

you, Thank Olivier.

XX our We industrial leadership are of of the with made focus. key drives these shows stakeholders. in all strategic and for priorities areas Slide pleased very progress Successful XXXX. value execution we our

innovation scale and share partners. our solutions and XXXX. strong drive gains saw through and to continue relationships strong We customers unmatched broad-based in we products demand our First, market exceptionally for with

technology on android the to RFID. ongoing trends and in mobile transitions capture system We data transition operating are to the industry, XD and the including computing in in capitalizing

underpenetrated categories launches our record addressing and geographies. number XXXX. and market a also had segments are solutions in We of across product We

portfolios printing been This mobile beyond. never have us and investment stronger. XXXX Our will capture, in to continue data computer, benefit and

Second, existing a plan our advantages. markets at advance we are and that underpenetrated growth on competitive where we are scale markets solutions we We attractive provider. as us where driving in new focused to categories the can leverage

expect includes highly to transform We flows. This strategy to traction intelligence proposition, to acquisitions businesses vision. selective growth investments. seeking differentiated play value gain in a through work both will can right these inorganic and organic We high that we with near our enterprise have our accelerate asset which adjacencies where a target markets advance

global specifications strict manufacturing monitoring acquire a a intention integration This point, Temptime we a portfolio January we into XX, will As on of new fit the designing smart of leader Corporation. incorporate our the in as great announced temperature capabilities. is and time vision and largest meets organizations vaccination enterprise to that programs. our health Temptime supplies these the advance asset is the intelligence acquisition proof

well have benefit unique into the other increased that this drive safety We from as food technology ability as as the industry, opportunities deeper asset to healthcare it into key scale such visibility. can

frontline advancing and visible, intelligence worker Third, to optimally our enable be every to are connected, vision asset enterprise and we asset utilized.

in our our to in continue partners. a vertical I markets customers and with primary expertise across expand and enables workflow further to relationships elaborate Our solutions strengthen us will minute.

capital flexibility and structure. cash flow enhanced have optimizing Zebra’s we by Lastly, and our strength increasing financial

Our a areas. priority the high key remains to accelerate in growth business flexibility financial traction adjacent in invest our we as

a Slide enable to enterprise digital view enterprise asset Zebra entire the provides intelligence. turning to Now XX, of

including and The determine condition possible information and operational like is information, analyzed products and best minute business about processes. greater a time to our Cloud hardware, insight infrastructures software, and sense friction real are the location, essential improved operations. I smart action. is status, the in and flows, assets, Our work The then products, to result to into spend productivity, solutions. on how in reduced

solution. its driven are products that maximize made productivity one are reliable size specification designed particular frontline is the designs purpose case. with and to device and for all tailor There work and safety use no flows. fits is a ultra-rugged Every for Our

is to software for a critical hardware, differentiator the In us. addition

mobile include printing We layer, that to integrate portfolios. this our and across call easy capture, our software intuitive make Our products software data computing, manage. them to is which integrated and DNA

security, and software with to our our of been starts two-thirds engineers enterprise we use, ease team, data government user have improve Additionally, which interface specialize enhance systems increasingly of The nearly maximize software development. applications all automated analysis, critical device customers. our are and in collection and developing and innovation and tools of new that

to enrich our continually smart team and portfolio of growing Our solutions. works products

that works, motion real SmartPack intelligent as solutions part trailer, ecosystem which powers data. integral such work our time our Cloud-based connect edge platform our Savanna, is and Another with solutions is data driven force of

independent our solutions our the vendor of have number Savannah that to problems edge. partners solve to of software their deploy accelerate performance We improve with and new collaborating been an increasing use for customers

of As are a we at our thought in forefront leader this opportunity. the industry,

Just transitions, as Cloud-based and scanning. have other XD enterprise, key including Android been printing, we RFID, with barcode adoption,

We are across seeing of operations. their we digitize help evidence as many EAI businesses vision our industries

driving a the critical grew technology in mobility, Cloud logistics, XXXX. manufacturing, automation, serve, ecommerce, proliferation force as in which key all devices; of are that healthcare, as transportation components XX of highlights which to digits markets the well smart and this of We double retail are advancing including primary and vertical each we megatrends, computing, Slide transformation.

marketplace. need strong across who and equipment, evolving chain. They customers trusted solutions In can for to compete and are industry expertise for supply our their leveraging are partners, We innovative end-to-end in to real where innovation manufacturing, their material, Recently, increase assembly people looking computers our time a in know cycle automotive enterprise all were effectively visibility, deliver considerations the Data security to global their customers complexity. wide deep to generation an customers key are for Android variety system latest line mobile product operational warehouse quality a other tablets control life of transitioned purchased and cost their while operating as they’ve and manufacturer our environment. an reducing and to processes. management and commitment

long-time us our or integration essential a and year recently care of world. and time system in being Last retailers dock, SmartPack one implementing TCXX a by tablets prominent healthcare, and purpose-built while customer providers mobile our healthcare and tools The mobile, various and elevate container e-commerce, transformative operating ecosystem assets our and the out solutions initiative We customer using provide collaboration Walgreens associates system visibility communications security efficient that existing of be of order differentiators to our scanners printers. showcased execute prominent omnichannel of on ever upgrades the in expanded overall improve experience, Zebra loading Federation enterprises increased they economy the month, compliments its care. seamless our loading every at this has all from have process nationwide. patient helped In the solutions assisted healthcare track products received facilitate to challenges. equipment cost. XX relationship been the connecting This selling In aircraft more real at customers Zebra’s the provide to productivity and improved the innovative Retail the at solution help business. installation. consolidate supply utilization had pressured mobile as complements increasingly this computers we with win streamline an of it’s and management level largest TCXX for of monitor their Expo, global And most translates applications and their floor that driving to on offerings experience. in-store ability patches life which to boost clinical and booth the their assesses We customer of run fulfilment, National are recently U.S. increasingly chain, our guarantee to time and effectiveness, enable into stores. we This solutions address their locationing complex and will demonstrated safety solution patients, our of existing computer shortage innovative Our in organizations a reduced drive patient products retail logistics and to investing real transportation in point business, demand Walgreens productivity. how The of warehouse, on ETXX shipments. point inventory including solutions to of labor our delivery. while our and In rolling and that and total booth, staging and facilitates to sales presence

co-workers all and summary, other to business complex In helping and Walgreens enterprise are empower are we successfully retailers at We seeing and their that a address collaboration many increasingly with with challenges. tools trend associates equip of mobile to customers customers. their

hand Now, the to I’ll call Mike. back over

Mike Steele

We’ll that we as now so one ask and you to one to call the you many get yourself Anders. Thanks to follow-up possible. We can question open that limit as Q&A. of

Operator

our comes Rodgers [Operator Please Instructions] ahead. Great go of Jason Lakes And first question Review. from

Jason Rodgers

guidance, then is by guidance for you're Good year a you morning. Wanted last to year's EBITDA improvement your guidance margin ask point beat the a forecasting less and question margin targeting initial earlier. over a year actually about this

similar So, factors wonder is if you the outperformance could XXXX? discuss why that in for and that could lead to margin

Olivier Leonetti

Jason. morning, good So,

margin, but the quarters, we we gross you planning are but year particular now, impact higher at full-year to quarter, we another. anomaly as number margin, in a over So, QX have have a of and have one slightly have some the you demonstrated we for the leverage could performance mix believe about ability which XX%, to OpEx, a quarter we’re one to in an leverage have also and in guiding margin, a could elements, EBITDA indeed but EBITDA higher

specific Jason. trend of in terms So, nothing

Jason Rodgers

at line. And the top looking then just

have there, progresses. the but As far comps your quarter as mid-to-high organic Do at past can guidance, rate continue think the be the you you you you facing will increasingly as that you first single-digit quarter? first year growth as look difficult

Anders Gustafsson

good We about business. feel the

being from productivity more now have to profitable strategies. driving our time We a of for have our moved customers more our solutions and by tools tactical as customer long been growth viewed enablers

think importance we’re kind our hierarchy for up I the moving So, of customers. in of

the execution have output and outlook record I prudent. of a We track is think strong

competitive I A We share to good we had the are year and solutions that momentum. XXXX. we’ve and the we of feel portfolio it’s in solid portfolio ever think gain continue So, we products most with a for entered markets. well-positioned

pretty feel we So, where good about we are.

Olivier Leonetti

And of you additional a on me give bit colors let year. the

obviously a have guide. we So, QX strong

visibility We QX. have for more

actually this We our regarding being entered guide point with different we are an about feel consider important solid another quarter well than markets confident the year. business. as we upon And compete. the ability visibility to have quarter. regarding the our would We the our full-year, is this based end not we And within prudent and Jason, And a backlog.

Jason Rodgers

squeeze could if And more in. I just one

side convert? the still on many latest need devices computing a outlook mobile in Just that estimate for deals left and how the field large are the for your to

Anders Gustafsson

had you look legacy I’d of channel. XX also Yes, last see devices million if deals, our We we now. the growth today good there. but our android. our and saw approximately we medium good from years, We and be field larger at businesses refreshed a android performance from be upgraded growth to still our have to larger XXXX, small to we we the good several in had waiting saw growth from strong but a say deals, also portfolio saw balanced In

in have avenues assumptions? many that any certainly to growth. we to So, drive order different pursue Joe

Joe Heel

onto as our Yes. and I consolidating would legacy for in as XXXX, had months number multiple see used cases momentum do our like the deals out large million we deployed warehouse cases substantial we larger you continuing our deals, space as; in the in opportunity handheld coming in large of devices they on form are add. but and that those customers logistics factor technologies and up form other to Especially are still particular retail in right. realize devices the the in expanding such areas well a are in used as next visibility We such towards there, that be screen. XX can year, beginning factors device from to tablets have new or today

So, for Jason. large opportunity continued deals we see

Jason Rodgers

Very good. Thank you.

Operator

Please Company. go Ricchiuti comes Our of from ahead. & next Needham question Jim

Jim Ricchiuti

good Hi, morning. you. Thank

wonder the that as it and of a up bump we're on of relates you seeing seeing could pace your that comment faster bit I we’re new couple introductions? a you. if Thank R&D to quarters, last to of terms area, and product product development in little if at a going in be spend, Looking

Olivier Leonetti

take the and would Let other the and first me part take Joe one. then Andres

So has R&D changed some. spending and the indeed, we of of the the have in R&D – composition increased spend is level

the are line capabilities. off into a We future this has of part result you were of shares investing that also details look gaining investment and more believe top to for is And paid we if performance into the the investment. this company

Joe Heel

Yes.

productive that think investments that very R&D. I certainly a made we in feel we have

solution more in or portfolio done of products company. than any We the have competitive new products history launched year the XXXX we’ve Our in the been. portfolios ever are most that other in

So, I the think has we R&D It’s in share are been been solid ROI. we feel investments that growth. confident supporting very It our market delivering supporting our made gains. a

Jim Ricchiuti

seeing my just is seeing to? alluded EMEA, question a And in the rate comps, it case some any signs that follow-up to just I’m to comparisons of are tougher have growth that you you’re companies some which there, and or wondering appears slowing moderation relates of tougher

Anders Gustafsson

broad-based a we starting bit broader, QX. across segments, in first, regions, all So markets little vertical our had product strength strong

America digits for four Asia-Pac, were retail, up digits, America Latin regions, and digits digits each the for Healthcare, in including major all product all vertical manufacturing, Europe double markets double QX, saw were they was all all categories double XXXX. up double up were North and up. but – were full-year. We

we for our our know, strong strength strong, we from and and So, would getting, think extend And direct end In the position you execute of believe have, our broad-based we proposition, competitive everything stronger continued based the seen, our which and in that it's is performance channel markets very with of the were we’ve – on continue valuable to market QX, – and well back I customers. I both on lead we say, very there. resonates the we’ve to portfolio.

and think Europe, be are and the on momentum be continues it we as that for solid growth. well bit to computing, but was to personal us to moderated strength particular solutions Specifically, scanning driver good XXXX. vertical our Europe we part had carrying would in in It growth, our a of Europe, as a shopping big And it on earlier see for mobile a XXXX, little I into We consider from supplies. strongest portfolio and that. saw retail still

Jim Ricchiuti

on year. Thank the you. Congratulations

Anders Gustafsson

Thank you.

Operator

Our of Please Blair. next question ahead. comes from go William Brian Drab

Brian Drab

you a quarters, could XX Maybe if morning. question, you’ve know, the but some be I or XX this you annually And but at maybe we somewhat million, How and figure, And you Hi, just a will more in be industry? below waste shouldn’t said a specific about good three Android? give this insight getting wondering those the roughly about kind just know, of million there? know, many million was thinking it's last us I’m devices are estimate across XX percentage you selling of the marketplace, the what are point? how, been

Anders Gustafsson

we of those. devices, the about convert think started million, down XX I we able on always the – we’ve lot reason a now, faster, that off going few think – I’m shipping about, But million So, been number XX memory one back, so are going years a we talking of Android to is hand, devices. not you know, I is

You the our of we but a are majority now but predominantly devices are say vast still players it’s most devices Microsoft amount are devices. I’d too, still other Android, – Microsoft our of industry shipping shipping meaningful that know,

from end, other on the one eat kind we getting So, players. into XX end replenished while it’s million the of other from

as by not to you based know, go down should you ship, these going vast XXXX. a after devices expect on the devices good late perceive, and – that as it upgraded still but, its of by might Android it’s be to majority XXXX amount know, or of fast do volume of devices we we So, here, you there’s will the –

Brian Drab

of you question, end make a you if maybe terms order that in more follow-up So, with about for growth rank thinking respect two-part it your And possibly you’re I’ll could I could? I’ll to question, then second guidance, on alright. how Okay, lines to know, same, the markets later the one. ordering contribution my you're do healthcare, you. most Thank at the rank then, the growth expecting manufacturing, product mobile question, a you computing the second could XXXX, printers? And take out in part where of retail, of of transport? know, in stab rate capture terms data and you maybe the

Anders Gustafsson

order of rank if feel see to I there's indications where or strength these, maybe lagging give be each you particular – hard still but here. anyone can some we It’s we or would

was healthcare you – So, fastest I grew your the for expect be just know, think vertical would question, know, which growth market. several the – over the us first four QX. XXXX, we rates years, on verticals. you next over fairly fastest not the the similar But vertical in to I growing markets, to but healthcare do our see a across

in look you had we our growth verticals. all in If double-digit XXXX, four of

and So, don’t kind company. of the will the for any load we one of expect carry that them standout

few more You was see it balanced. driver, know, but as we more the pronounced a back, maybe retail now years

we the year. was earlier, kind weaker You And know, perspective, all past this double-digit you pickup manufacturing from manufacturing know, we growth had, Android adoption a in in of again, around little the see coming a but four warehouse. region’s year, to this regions particularly

So, them performing well. all we see

Asia-Pacific see will but not within know, in go Europe you than well a performed growth average for QX, we good be I but grow Europe next very to as hope that bit of XXXX. into but was North or quarters, little has over still a be over helps. the we America expect weaker the one kind too. the the fastest quarter longer-term. the foreseeable quarters, just future, the It a can of variability couple we would

Brian Drab

more but a congratulations XXXX. on And thanks. great later, follow-up Yes, I’ll Okay.

Olivier Leonetti

Brian. you, Thank

Operator

go from question comes Eastman Robert Baird. next Richard of ahead. Please W. Our

Richard Eastman

Yes, morning Anders. good

Anders Gustafsson

Good morning.

Richard Eastman

Mike. And

– Just Joe. and

around basis mean margin improvement impressive. segments is and the to how gross both question, a it, full-year, you both of And first bit Just little that you the I'm again, deliver for certainly is you baseline a here question, as was gross plus here you quick around are a give could pieces You and for know, saw the moving curious color structural gross forward? the how that if the segments in of know, that? margin AIT know, and somewhat gross margins. that look it – how maybe thinking that of view quarter EVM and you I XXX point year, from is in just both margins you quite as you

Olivier Leonetti

So, have margin significantly, increasing point. been said, you a as by year-on-year we about gross

increase a procurement, We team that gross gross same case we focused value add chain pattern have ability the have actually we being as the we’re to product margin the should been – would of as margin best main directionally follow believe believe highly going a don't we have we we our business, expand two keep playing the design, And forward. that and the on a today. go-to-market, play Every that manufacturing, margin. game think segments We think the element to ability and role, gross rate. and

Anders Gustafsson

As said, company-wide this know, Olivier you a is activity.

so entire culture, to on. it’s paying I growth and ratio think working if the that there's company and attention our – [or margins], something in gross two, it’s one number or that is ingrained deeply is

Richard Eastman

a two factor play segments? price the in significant Did either of

Anders Gustafsson

say, I our has Yes, commercial would improved. discipline

appropriate would more commercial terms be. We to paying attention what are

scientific more So, that. doing I think about we we’re a in little go bit how

Olivier Leonetti

be play to a enhanced gross and solutions add able – a offering would driver mix interrupt our is to play also being us performance. is to Mix a Richard, margin sorry of mix, also

Richard Eastman

points think Awesome. as I EBITDA appears mean, difference know, of to in just that adjusted a just I it improvement again, though you of you're first EBITDA relates kind basis the XXXX, for, improvement. for the to question XX a my question, forecasting quick looking as you're as maybe follow-up, is it follow-up

the up basis together maybe gross the putting of or redeploy in the the you margin Zebra’s settling of margin year bps, – know, channel? on know, improvement? for the that, into, XX is same feed with plus know, EBITDA drive and kind and business you a gross point we equation street being a into, model So, R&D XXX know, margin that you you maybe the are maybe thought And we target type here

Olivier Leonetti

No, no, indeed.

to So are believe by again, be the R&D, Richard, margin scale invest R&D proportion way OpEx, our rate both able dollar revenue ability we including as and of gross good we in as we dollars. a dollars to improve – to

We EBITDA too we of the prudent. improvement are rate on I’m I mentioning. and so as term in sure would with a balanced of have you’re and the in not flaws being year and in we prudent category the is company, necessarily agree the believe

Anders Gustafsson

having As key it. philosophy a across our part the of and Olivier earlier, P&L how is manage mentioned we leverage

want to leverage see So, side we OpEx we gross translate to drive into improvements margins. EBITDA certainly want in profit, and that the higher we want in to see

Richard Eastman

year. Alright, great, and thank well tremendous you

Anders Gustafsson

you. Thank

Operator

comes go question from of next Our Paul Coster ahead. Morgan. JP Please

Paul Coster

questions. my taking for thanks Yes,

well, up So, can quarter that or the to backlog is for how much as either trends Thank you overall what’s backlogs, year, some the you sense in points plus of in in mix even the your give the pipeline of our business? as the backlog you. gives and sense visibility us pipeline,

Anders Gustafsson

partners teams down and all for process diligent a segments more the the to we in to top and pipeline customers, obviously the of outlook up much more that longer-term and It for quarter obviously quarter sales ways. what customers, lot doesn’t drives pipelines a but The our bigger have have us But work a much The visibility gives about we we different bottom into variety as is us direct also gives enter year. about confidence triangulate our very our the better as direct the into of and necessarily channel quarter. disciplined with second a and a outlook. go we tell doing Yes. and us develop half pipeline the backlog having

Joe the gives the of want or half the visibility for second out more to quarters So, us something. maybe add and Heel that’s what

Joe Heel

visibility for towards us give largest we well deals geared visibility for significantly expanded in evolve our the To at particular to which continuously Both with have we contributed success quarters level. had we how period. very three-year expect our that, visibility business have our individual beyond building and in of a and pipelines look to as have Yes. three customers over backlogs, the XXXX, to about time we we have at customers granular two a large where as the years,

a So, us things of although qualitative more view are of a gives that it’s longer-term evolving. where

we there, that and that see earlier the warehouse million talked the are already of we out can fact If one devices of those XX you trends remaining significant in at a in that, see space. portion about trends look manufacturing them that we is the that logistics

terms things are tablets of comments, up pipeline the from in the discipline. in visibility we’re getting and quite call in also that opportunities in prominently RFID see areas We earlier that trend, like adjacencies showing we that

Paul Coster

Excellent.

are might can The stronger other question the in size why on I that the customers, like have even you customers it is, enterprise America sounds be? that comment North than small-to-medium

Joel Heel

is well. about were of first as adopting manufacturing T&L, of those that Android A just put similar smaller large adopters we customers and the between a terms now there’s customers, solutions correlation trend that the that in out solutions medium these are we talked and and size

some by in innovations channel only second growth this which Android for supported market. customers many that the Now, ecosystem market now to one some I for the we’ve wave where that also is think in the established a of are is takes place, gaining brought true SMB those. brought we’re well are And to are now partners of example those the that our confidence solutions area of and of also giving to solutions some us market, other is channel adopt this we’ve solutions, seeing the our of these

Anders Gustafsson

us. in effort. happen just emphasize the that would the a market didn’t that’s I SMB strength just No, consorted to

not that number of markets. we felt that the penetrated of at as business as of help initiatives market our end some that developed boost a were have an the our lower we to was penetrate more deeply, help to in area higher-end well we We were because

Paul Coster

Thank you.

Operator

from comes Please Northcoast Housum question go next ahead. Research. Our Keith of

Keith Housum

very opportunity guys. are but – it strong prioritize, some growth guys well? I of you segments on a Can of possible the I the to printing as you guess, I year. lot guys business? the the understand two in and and business, capture but growing call, drivers to mobile is the did morning, other appreciate on the are mobile drivers computer for, the the they computers, the not want covered a still the congratulations I in know, Good think quarter growth you how necessarily

Anders Gustafsson

of, product is just are start I’ll number growth lines. Yes, all strong there across trends driving a growth know, secular you that by some our

on Then much all of get so many of connected. more trace also those say, but new into these, the and mobile all know, we it sees omni-channel by is broader the our on-demand trends deploy newer areas. type one, those products secular side, know, economy, scanning, flexibility our know, the you when being more you printing, so the supplies, so requiring see the piece, track it we we helps that once You that are us under are computing us areas first the of e-commerce roll-out, on technologies, helps customers

can lot if a a know, it. or computer do they printer, So, that’s a with more you mobile

they see they more So, new cases used more that apply. and can

know, You a will run three an back know, days, to average that the two, Microsoft if applications. go again computer you probably I couple old think mobile I

You we on know, routinely one our customers devices. XX today, applications running of see

great today. and the those very our So, is say portfolio competitiveness are will drivers I strong of for it,

of and new into and we lead to extend know, we’ve and helping they’re than more our markets You in XXXX in history company, the products launched up driving done nicely, the ramping growth. all us

Keith Housum

Great, know, you kind some X.X can us my in target for range to to your down X.X? of the follow-up, from of X.X leverage to terms thanks. your logic Olivier expanding share just you of X In

Olivier Leonetti

manage business acquisition go-to-market R&D, to flexibility new our or of with We have process to mentioned we after the cash. to Temptime want the priority organically, a in another want are in be finalizing either invest and would M&A, We one, Xplore. in through we

we we Another in discussed, that range, believe prior bottom calls, once our Keith, share one would a reach buyback consideration. the we become of

is for So, range of the rationale it up set bit as now. that's a a

Keith Housum

thank Great, you.

Anders Gustafsson

Keith. you, Thank

Operator

Morgan Faucette question ahead. comes Please Stanley. of James next from Our go

James Faucette

of up bit they making vary Are and And wanted to seems the very visibility also small in a a a and medium-sized ago, businesses. It visibility? a I’m have year on up? would a how I little the Great. and today you ago? morning. conversations get quickly little say, your much on really dig to invisibility. lot terms trying Thank more both may [REIT], year just in in it about you pipeline color versus been that today you more compare for pipeline conversation make terms also but like of of How there’s frank this a greater pipeline of versus, in proportion

Anders Gustafsson

biggest some I’ll visibility So, more more then from balanced computing be we it's on the Joe – a probably mobile will dependent what support is I’d ago, But little the the balanced. segments similar were but say, XXXX, start, provide and our I’ll more to it pipelines overall say, pipeline probably We be those of may better, going Today, and much our it’s were to and were kind detail. into have was I’d – year the retail change. a growth. more

know, know, we a year have year, that they to you we not very our as a portfolio it very didn’t those a but for have to You year, well, printing scanning good expect last stronger good areas. pipeline have

good So, very the Maybe our a and ended up see we’re geographies with growth we and year a the in T&L, growth similarly we more the vertical on diversified very and XXXX, Joe? pipeline each that this across have outlook. balanced manufacturing equally markets, side, we of healthcare, supports geographic for driving

Joe Heel

particular, pipeline our improve dimensions. on smaller, visibility longer that would granular in is would visibility at that more increasing sooner be more last an to get improve sales and capabilities term, visibility to to get and One out significantly the number I right. the scanning in invested say, dimension areas quest, one perspective, level. where ongoing visibility, is printing in year to we've in are And of to quite the Yes, second and deals a from a a

things mix, of those important having the like extremely guidance large give for our importance is internal, With we that. well as both in planning growing to our visibility deals business purposes as and other

in of helping it us. those and have we invested So, is both

Olivier Leonetti

I been very James, if the mean, two in over company, more additional intentional have of the we in and guide color really as this diversify years last you to reflected an business, may, being see the the the and I yet financial than diversification performance well.

James Faucette

FX. bit then, that what for the can give you're little think expecting we into But points exposures with appreciate us year? And come Great, clarity of as up you from you follow-up look all and Olivier. Olivier. I just you're you are, what you a reference expected at headwind as your how for that, headwind using appreciate the kind And insight when then, I I to – of question to of appreciated, this type and formulate a the

Olivier Leonetti

FX only the neutral which XXXX. good in against that reason It enough we believe slight be But P&L. edging half the headwind them, of to to euro, a performance be we’re and FX some is to levers So, and in exposure. the we have to currency to still deliver manage adjust second many the financial of our started different XXXX effects to levers of which is be that have a the company. against really this for we performance. is one would The financial have able we

James Faucette

Thank so great. you much. That’s

Operator

question And Please of Khan ahead. Saliq come last Imperial will our from Capital. go

Saliq Khan

on questions you. thank two Anders, Olivier. our Guys, Hi quick Great, end.

that invest you one their a of confidence hear willing new NRF part improved to retail are as more their retailers you open First that decisions wallets, being seeing these conference on gives many in purchasing the is, what well? Are up did bit you at technologies?

Anders Gustafsson

first, great record saw we feedback – think had through maybe us year. think we for very meetings had got record was very a show NRF You and We booth; with number we and exciting a know, I was traffic customers; this the we I very, had good. of the booth

strategy an in e-commerce a US, have tier retailers, see we moving we've committed I’d them type couple that X of further make larger certainly So, execute customers, trend great some investments wanting was year. the against omni-channel are so that. type e-tailors. to into more and strategy more – compete the and of for what a this say, to solutions seeing confidence similar particularly kind we in of – is on their say enable is X, kind new to to the that retailers, give seen felt the few of been orders a last helped and us omni-channels to largely But the for years, it quite show from we tier down retailers

you technologies to the and their types – our I – think So essential know, of are, thinking.

pursue those strategies. those know, partner help enable see realize who You strategies us they as and a help can them to them

a and us all to it great aspects So, was show for from Joe.

Joe Heel

things of you the I us earlier of a Yes, did mentioned at very add, prominent confidence. lot some were we might NRF, and know, give

with talked those. we that about what seeing, already example, retailers cases are embracing the we’re new For used

of just the example, device of Those give in inventory are For a few us their types another one a voice not to everyone associates giving since workers, collaboration our And mobile of selected trends those that trend for the their adopters management. of system between an operating involved who important confidence. android is refreshing example deploying support are into that of on this first early on, with point. device are thinking those for see MCXX solutions wave we computing went that at

is means there the and opportunity space. that continued retail So longevity in

Saliq Khan

strategy, rate, especially and and in you your it of and Got sales you, What either within article? that. faster over your as change hardware growth versus seeing to sales you this was within this thank did that year follow-up guys the channel my service well a or past software are type

Anders Gustafsson

we’ve very there. up. we’re before. than – was and a going the with we Generally, the performance our and faster up is speaking, There revenue we in service software done saw solution content growth saw pleased in and software very Generally up QX

the with that of you information with read a off dump another would something android to could system transfer started devices relatively read barcode that that history of think do our you company, it where it. devices and say the If we to

gain can can manipulate You data, you the from it. actions

can lot You with that. a do

Next is have smart infrastructure. now more step to much

data the too. can can things actions automate So, dispensing automate that the that of capture

how bigger value develop becoming that a more solutions more what and and is software part we to do customers. and of to new bigger we our So,

Joe Heel

invested the improvements changed that have we’ve over to we’ve additions One channel strategy of things few the and our last and done of is, our course in we some in sales A had economics. the year.

We go-to-market internally, as have into channel partners. resources, both those well reinvested our as a with

in strategy. has program to continued in the our channel in and specialized solutions or the We’ve dedicated that The membership invested and of our that expanded realize a membership to in importance that have of only our has in selling over and sales and focused year. expand up sellers increased are also significantly last the group, on intelligent we the is EAI core quite commitment program Our the program. the make to benefits edge solutions our as go-to-market channel structurally growing organization

our we regions. have dedicated now So, in of a one group of every that

So, the of those are of changes. highlights some

Saliq Khan

you, Perfect. Thank guys.

Operator

This like conference back Gustafsson Mr. concludes our question-and-answer for session. any to I would turn closing to remarks. the

Anders Gustafsson

you. Thank

I to want another for thank exceptional up, As XXXX. an and we Zebra wrap the quarter and team partners great our

start once XXXX a to great a we to to Temptime off the team the Have welcoming year and a We’re strong close forward see look transaction. solid ahead. everyone. day, We

Operator

Thank concluded. now for is presentation. conference The you today’s attending

You may now disconnect.

Zebra Technologies (ZBRA) 14 Feb 192018 Q4 Earnings call transcript