Net sales were $1,052 million in the first quarter of 2020 compared to $1,066 million in the first quarter of 2019. The decline was primarily due to supply chain disruptions driven by COVID-19 and significantly reduced customer demand in China.
Net sales in the Enterprise Visibility & Mobility (EVM) segment were $681 million in the first quarter of 2020 compared with $709 million in the first quarter of 2019. Asset Intelligence & Tracking (AIT) segment net sales were $371 million in the first quarter of 2020 compared to $357 million in the prior year period. First-quarter year-over-year organic net sales decreased 2.9% in the EVM segment and increased 3.2% in the AIT segment. The supply chain disruption primarily impacted mobile computing products in the EVM segment.
First-quarter 2020 gross profit was $473 million compared to $501 million in the comparable prior year period. Gross margin decreased to 45.0% for the first quarter of 2020, compared to 47.0% in the prior year period.
"The year started off strong for Zebra, yet late in the first quarter, COVID-19 developed into a global pandemic and we experienced global supply chain disruptions, as well as weaker-than-expected demand in China. Our teams took extraordinary steps to manufacture and supply our mission-critical products to customers around the world. However, we were unable to fulfill our complete order book in the quarter. As a result, we missed our first quarter sales and profitability outlook,” said Anders Gustafsson, CEO of Zebra Technologies.
“We entered the second quarter with a strong order backlog,” Gustafsson added. “That said, we are entering a recessionary global enterprise spending environment and continue to see pronounced end-market weakness in China. Our diversified end-markets and strong financial position will enable us to endure this challenging economy while we preserve investments in advancing our Enterprise Asset Intelligence vision."
Net income for the first quarter of 2020 was $89 million, or $1.65 per diluted share, compared to net income of $115 million, or $2.12 per diluted share, for the first quarter of 2019. Non-GAAP net income for the first quarter of 2020 decreased to $145 million, or $2.67 per diluted share, compared to $160 million, or $2.92 per diluted share, for the prior year period.
As of March 28, 2020, the company had cash and cash equivalents of $24 million and total debt of $1,405 million. Free cash flow was $95 million for the first three months of 2020. The company generated $108 million of operating cash flow and incurred capital expenditures of $13 million.
The company expects second-quarter 2020 net sales to decrease approximately 11% to 17% from the second quarter of 2019 due to an anticipated recessionary global environment from COVID-19. This expectation includes an approximately 50 basis point additive impact from recently acquired businesses, and an approximately 1 percentage point negative impact from foreign currency translation.
Given the extremely low visibility of COVID-19 impacts beyond the second quarter, the company is withdrawing its prior full-year 2020 financial outlook. The company expects net sales, adjusted EBITDA margin, and free cash flow to be lower than last year, which we are addressing through cost actions to enhance profitability and cash flow.
As previously stated, the company is diversifying the sourcing of most of its US volumes out of China. Through the first nine months of 2020, these actions are expected to result in approximately $20 million of one-time pre-tax charges plus approximately $10 million of capital expenditures. This project is expected to be substantially complete by mid-2020 despite disruption from COVID-19 in southeast Asia.