Zebra Technologies ZBRA

We are exposed Large, multi-year, and fixed-price contracts may expose the Company to risks under large, multi-year contracts that may negatively impact could lead to losses and adversely affect our business. We enter into large, multi-year contracts with our customers customers, some of which are on a fixed-price basis, that expose could subject us to risks, financial risks if we fail to properly estimate our costs. Because many of these contracts involve new technologies and applications, require us to engage subcontractors, and span multiple years, our initial cost estimates are subject to unforeseen events. These events, which include technological difficulties, fluctuations in the price of raw materials, challenges with our subcontractors or suppliers, and significant increases in inflation, may cause cost overruns and result in such contracts becoming less favorable or even unprofitable. In addition to risks related to cost estimation, these contracts may expose the Company to other challenges including among others: (i) technological risks, especially when contracts involve new technology; (ii) financial risks, including the accuracy of estimates inherent in projecting costs associated with large, long-term contracts technology, and the related impact on operating results; and (iii) cybersecurity risks, especially in offerings or managed services contracts with customers that process personal data. Recovery Furthermore, the recovery of front-loaded costs incurred on long-term managed services and software-based offerings contracts with customers is dependent on the continued viability of such our customers. The insolvency of customers a customer could result in collectability risk of outstanding trade receivables, and/or a loss of anticipated future revenue attributable to that program or offering, which offering. Such contracts’ financial, technological, and cybersecurity risks could have an adverse impact on our profitability. the Company’s profitability and financial results.

On May 17, 2022, During the year ended December 31, 2025, the Company announced that its repurchased 2,138,127 shares of common stock for approximately $587 million. Subsequent to the year ended December 31, 2025, the Company repurchased 401,649 shares of common stock for approximately $100 million through February 5, 2026. Additionally, on February 4, 2026, the Company’s Board of Directors authorized a additional share repurchase program for repurchases of up to $1 billion of its outstanding shares of common stock. The authorized share repurchase program does not have a stated expiration date. billion. The level of the Company’s repurchases depends on a number of factors, including its financial condition, capital requirements, cash flows, results of operations, future business prospects and other factors its management may deem relevant. The timing, volume, and nature of repurchases are also subject to market conditions, applicable securities laws and other factors and may be amended, suspended or discontinued at any time. Repurchases may be affected from time to time through open market purchases, including pursuant to a pre-set trading plan meeting the requirements of Rule 10b5-1(c) of the Securities Exchange Act of 1934. During the year ended December 31, 2024, the Company repurchased 130,560 shares of common stock for approximately $47 million. As of December 31, 2024, the Company has cumulatively repurchased 539,574 shares of common stock for approximately $154 million, resulting in a remaining amount of share repurchases authorized under the plans of $846 million. Subsequent to the year ended December 31, 2024, the Company has repurchased 128,466 shares of common stock for approximately $50 million through February 6, 2025.

December 31, 2027 year-end In September 2025, the FASB issued ASU No. 2025-06, Intangibles—Goodwill and interim periods thereafter, Other—Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software, which amends the criteria for capitalizing internal-use software development costs. This ASU will be effective for the Company beginning in 2028, with early adoption permitted. We While we are currently assessing the impact of this guidance on our disclosures; ASU, we do not expect it will not to have an a significant impact on our results of operations, cash flows, or to the Company’s consolidated financial condition. statements.

December 31, 2025 2024 2023 Incentive compensation $ 150 $ 174 $ 47 Payroll and benefits 76 83 Customer rebates 56 40 Unremitted cash collections due to banks on factored accounts receivable 84 51 112 Payroll and benefits 75 76 Customer rebates 63 56 Current portion of lease liabilities 38 36 42 Warranty Current portion of warranty liabilities 28 26 27 Freight and duty 26 12 10 Exit and restructuring 23 4 22 Settlement — 45 Other 71 68 76 Accrued liabilities $ 558 $ 503 $ 504