Zebra Technologies Corporation

Good day, and welcome to the Zebra Technologies first quarter 2023 earnings conference call. Today, all participants will be in a listen-only mode. Should you need assistance during today's call, please signal for a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. Please note that today's event is being recorded. And at this time, I would now like to turn the conference over to Mike Steele, Vice President of Investor Relations. Please go ahead.

Good morning and welcome to Zebra's first quarter conference call. This presentation is being simulcast on our website at investors.zebra.com and will be archived there for at least one year. Our forward-looking statements are based on current expectations and assumptions and are subject to risks and uncertainties. Actual results could differ materially due to factors discussed in our SEC filings. During this call, we will reference non-GAAP financial measures as we describe our business performance. You can find reconciliations at the end of this slide presentation and in today's earnings press release. 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 will include prepared remarks from Bill Burns, our Chief Executive Officer, and Nathan Winters, our Chief Financial Officer. Bill will begin with our first quarter highlights. Then Nathan will provide additional detail on the Q1 results and discuss our revised 2023 outlook. Bill will conclude with progress made on advancing our enterprise asset intelligence vision. Following the prepared remarks, Joe Heal, our chief revenue officer, will join us as we take your questions. Now let's turn to slide four as I hand it over to Bill.

Thank you, Mike. Good morning and thank you for joining us. Our team executed well in a challenging macroeconomic environment, delivering first quarter sales and earnings results above the midpoint of our outlook. For the quarter, we realized sales of $1.4 billion, approximately in line with the prior year. An adjusted EBITDA margin of 21.4%, 150 basis point increase, and non-GAAP diluted earnings per share of $3.94, a 2% decrease from the prior year. Regional sales performance was mixed, with growth in Asia-Pac and North America mostly offsetting declines in EMEA and Latin America. From a solutions perspective, printing, data capture, and RFID were bright spots, while sales of mobile computers declined. we continue to see cautious spending behavior by enterprise customers with a decline in large orders and growth in small to mid-size orders. From a profitability perspective, improved gross margin drove our EBITDA margin increase. Higher interest and tax expense resulted in a slight earnings decline. I would now like to spend a moment on our sales outlook. As the risk of broader softening of industry demand has materialized, we have reduced our full-year outlook. Late in Q1 and into Q2, demand trends softened across our end markets, particularly for mobile computers in EMEA and North America, as customers' CapEx budgets tightened and IT device spending contracts. We are mitigating the impact of softer sales with targeted go-to-market actions to drive additional demand and incremental cost actions. We will continue to take an agile approach to managing throughout this uncertain near-term environment. I will now turn the call over to Nathan to review our Q1 financial results and provide additional details on a revised 2023 outlook.