Company raises full-year revenue and earnings
outlook
- Sales of $1.8 billion, up 18 percent
from a year ago
- Organic revenue1 growth of 6
percent
- Backlog of $9.4 billion, up $919
million or 11 percent from a year ago
- GAAP earnings per share (EPS) of $1.05,
up 35 percent
- Non-GAAP EPS* of $1.46, up 30
percent
Motorola Solutions, Inc. (NYSE: MSI) today reported its earnings
results for the second quarter of 2018. Click here for a printable
news release and financial tables.
"Our outstanding second-quarter results highlight the continued
strength of our land-mobile radio business and momentum in services
and software," said Greg Brown, chairman and CEO of Motorola
Solutions. "With our strong earnings, cash generation and
highest Q2 backlog position ever, we are well positioned for
continued growth."
KEY FINANCIAL RESULTS (presented in millions, except per
share data and percentages)
Q2 2018 Q2 2017 % Change
Sales
$1,760 $1,497 18%
GAAP
Operating Earnings
$273 $261 5% % of Sales
15.5% 17.4% EPS
$1.05 $0.78 35%
Non-GAAP Operating Earnings
$378 $316 20% % of Sales
21.5% 21.1% EPS
$1.46 $1.12 30%
Products and Systems Integration Segment Sales
$1,189
$1,047 14% GAAP Operating Earnings
$175 $190 (8)% % of Sales
14.7% 18.1% Non-GAAP Operating Earnings
$226 $204 11%
% of Sales
19.0% 19.5%
Services and Software Segment Sales
$571 $450 27%
GAAP Operating Earnings
$98 $71 38% % of Sales
17.2%
15.8% Non-GAAP Operating Earnings
$152 $112 36% % of Sales
26.6% 24.9%
*Non-GAAP financial information excludes the after-tax impact of
approximately $0.41 per diluted share related to share-based
compensation, intangible assets amortization expense and
highlighted items. Details on these non-GAAP adjustments and the
use of non-GAAP measures are included later in this news
release.
OTHER SELECTED FINANCIAL RESULTS
- Revenue - Sales increased $263
million, or 18 percent from the year-ago quarter, driven by growth
in all regions. Approximately $154 million of revenue growth was
related to acquisitions, and $24 million was related to the
adoption of accounting standard ASC 606. The Products and Systems
Integration segment grew 14 percent driven by the Americas and
EMEA. The Services and Software segment grew 27 percent led by the
Americas and EMEA.
- Operating margin - GAAP
operating margin was 15.5 percent of sales, compared with 17.4
percent in the year-ago quarter. The decline reflects higher
operating expenses related to acquisitions, partially offset by
higher gross margins in Services, the adoption of ASC 606 and
favorable mix. Non-GAAP operating margin was 21.5 percent of sales,
compared with 21.1 percent in the year-ago quarter driven by higher
gross margin partially offset by higher operating expenses related
to acquisitions.
- Cash flow - Operating cash flow
was $425 million, compared with $173 million of operating cash
generated in the year-ago quarter. Free cash flow2 was $384
million, compared with $120 million of free cash flow generated in
the year-ago quarter. Cash flow for the quarter was higher on
improved working capital and higher earnings.
- Capital allocation - The company
paid $84 million in cash dividends. From a debt perspective, the
company repaid $100 million on the revolving credit facility ahead
of schedule, leaving an outstanding balance of $300 million. The
company also repaid the remaining $40 million revolver balance
assumed in the Avigilon acquisition and closed this credit
facility.
- Backlog - The company ended the
quarter with backlog of $9.4 billion, up $919 million from the
year-ago quarter. Products and Systems Integration segment backlog
was up 13 percent or $367 million, and Services and Software was up
10 percent or $552 million. Land mobile radio demand led by the
Americas continues to drive backlog growth.
KEY HIGHLIGHTS
Services and Software wins
- $50 million for a multi-year services
agreement for a county wide P25 system in North America
- $41 million for command center software
and 10-year services award in Asia
- $16 million multi-year services renewal
in Chile
Products and Systems Integration
wins
- $71 million P25 system upgrade in
Northern Africa
- $35 million P25 expansion for New South
Wales Telco Authority in Australia
- $15 million P25 system replacement for
Flagler County, Florida
- $495 million five-year IDIQ (indefinite
delivery, indefinite quantity) P25 radio upgrade for U.S. Army
BUSINESS OUTLOOK
- Third-quarter 2018 - Motorola
Solutions expects revenue growth of approximately 13 percent
compared with the third quarter of 2017. The company expects
non-GAAP earnings in the range of $1.67 to $1.72 per share. This
assumes 173 million fully diluted shares.
- Full-year 2018 - The
company now expects revenue growth of approximately 14.5 percent,
up from the prior outlook of 14 percent including $40 million of
unfavorable currency impact since our prior guidance. The company
now expects non-GAAP earnings per share in the range of $6.79 to
$6.89, up from the prior guidance of $6.70 to $6.85. This assumes
current foreign exchange rates, approximately 172 million fully
diluted shares and a 25 percent effective tax rate.
CONFERENCE CALL AND WEBCAST Motorola Solutions will host
its quarterly conference call beginning at 4 p.m. U.S. Central
Daylight Time (5 p.m. U.S. Eastern Daylight Time) on Thursday, Aug.
2. The conference call will be webcast live at
www.motorolasolutions.com/investor.
CONSOLIDATED GAAP RESULTS (presented in millions,
except per share data)
A comparison of results from operations is as follows:
Q2 2018
Q2 2017 Net sales
$1,760 $1,497 Gross
margin
822 690 Operating earnings
273 261 Amounts attributable to Motorola Solutions,
Inc. common stockholders Net earnings
180 131 Diluted EPS
$1.05 $0.78 Weighted average diluted common shares
outstanding
171.7 169.0
HIGHLIGHTED ITEMS AND SHARE-BASED COMPENSATION
EXPENSE
The table below includes highlighted items, share-based
compensation expense and intangible amortization for the second
quarter of 2018.
(per diluted common share)
Q2
2018 GAAP Earnings $1.05
Highlighted Items: Share-based compensation expense $0.08
Reorganization of business charges 0.10 Intangibles amortization
expense 0.23 Avigilon purchase accounting adjustment 0.04 Sale of
investments 0.01 Loss on foreign currency related to Avigilon
purchase 0.01 FIN 48 reserve 0.01 State audit settlement (0.07 )
Non-GAAP Diluted EPS
$1.46
USE OF NON-GAAP FINANCIAL INFORMATION
In addition to the GAAP results included in this presentation,
Motorola Solutions also has included non-GAAP measurements of
results. The company has provided these non-GAAP measurements to
help investors better understand its core operating performance,
enhance comparisons of core operating performance from period to
period and allow better comparisons of operating performance to its
competitors. Among other things, management uses these operating
results, excluding the identified items, to evaluate performance of
the businesses and to evaluate results relative to certain
incentive compensation targets. Management uses operating results
excluding these items because it believes this measurement enables
it to make better period-to-period evaluations of the financial
performance of core business operations. The non-GAAP measurements
are intended only as a supplement to the comparable GAAP
measurements and the company compensates for the limitations
inherent in the use of non-GAAP measurements by using GAAP measures
in conjunction with the non-GAAP measurements. As a result,
investors should consider these non-GAAP measurements in addition
to, and not in substitution for or as superior to, measurements of
financial performance prepared in accordance with generally
accepted accounting principles.
Organic revenue: Reflects net sales calculated under GAAP
excluding net sales from acquired business owned for less than four
full quarters, and excludes the affects of ASC 606. Management
believes organic revenue helps it and investors better identify the
underlying trends of established and ongoing operations by
excluding the effects of acquisitions and accounting adjustments
which can obscure period to period comparisons.
Highlighted items: The company has excluded the effects of
highlighted items including, but not limited
to, acquisition-related transaction costs, tangible and
intangible asset impairments, restructuring charges, non-cash
pension adjustments, significant litigation and other
contingencies, significant gains and losses on investments, and the
income tax effects of significant tax matters, from its
non-GAAP operating expenses and net income measurements because the
company believes that these historical items do not reflect
expected future operating earnings or expenses and do not
contribute to a meaningful evaluation of the company's current
operating performance or comparisons to the company's past
operating performance. For the purposes of management's internal
analysis over operating performance, the company uses financial
statements that exclude highlighted items, as these charges do not
contribute to a meaningful evaluation of the company's current
operating performance or comparisons to the company's past
operating performance.
Share-based compensation expense: The company has excluded
share-based compensation expense from its non-GAAP operating
expenses and net income measurements. Although share-based
compensation is a key incentive offered to the company’s employees
and the company believes such compensation contributed to the
revenue earned during the periods presented and also believes it
will contribute to the generation of future period revenues, the
company continues to evaluate its performance excluding share-based
compensation expense primarily because it represents a significant
non-cash expense. Share-based compensation expense will recur in
future periods.
Intangible assets amortization expense: The company has excluded
intangible assets amortization expense from its non-GAAP operating
expenses and net earnings measurements, primarily because it
represents a non-cash expense and because the company evaluates its
performance excluding intangible assets amortization expense.
Amortization of intangible assets is consistent in amount and
frequency but is significantly affected by the timing and size of
the company’s acquisitions. Investors should note that the use of
intangible assets contributed to the company’s revenues earned
during the periods presented and will contribute to the company’s
future period revenues as well. Intangible assets amortization
expense will recur in future periods.
Details of the above items and reconciliations of the non-GAAP
measurements to the corresponding GAAP measurements can be found at
the end of this press release.
BUSINESS RISKS
This news release contains "forward-looking statements" within
the meaning of applicable federal securities law. These statements
are made pursuant to the safe harbor provisions of the Private
Securities Litigation Reform Act of 1995 and generally include
words such as “believes,” “expects,” “intends,” “anticipates,”
“estimates” and similar expressions. The company can give no
assurance that any actual or future results or events discussed in
these statements will be achieved. Any forward-looking statements
represent the company’s views only as of today and should not be
relied upon as representing the company’s views as of any
subsequent date. Readers are cautioned that such forward-looking
statements are subject to a variety of risks and uncertainties that
could cause the company’s actual results to differ materially from
the statements contained in this release. Such forward-looking
statements include, but are not limited to, Motorola Solutions’
financial outlook for the third quarter and full year of 2018.
Motorola Solutions cautions the reader that the risk factors below,
as well as those on pages 8 through 20 in Item 1A of Motorola
Solutions’ 2017 Annual Report on Form 10-K and in its other SEC
filings available for free on the SEC’s website at www.sec.gov and
on Motorola Solutions’ website at www.motorolasolutions.com, could
cause Motorola Solutions’ actual results to differ materially from
those estimated or predicted in the forward-looking statements.
Many of these risks and uncertainties cannot be controlled by
Motorola Solutions, and factors that may impact forward-looking
statements include, but are not limited to: (1) the economic
outlook for the government communications industry; (2) the impact
of foreign currency fluctuations on the company; (3) the level of
demand for the company's products; (4) the company's ability to
refresh existing and introduce new products and technologies in a
timely manner; (5) exposure under large systems and managed
services contracts, including risks related to the fact that
certain customers require that the company build, own and operate
their systems, often over a multi-year period; (6) negative impact
on the company's business from global economic and political
conditions, which may include: (i) continued deferment or
cancellation of purchase orders by customers; (ii) the inability of
customers to obtain financing for purchases of the company's
products; (iii) increased demand to provide vendor financing to
customers; (iv) increased financial pressures on third-party
dealers, distributors and retailers; (v) the viability of the
company's suppliers that may no longer have access to necessary
financing; (vi) counterparty failures negatively impacting the
company’s financial position; (vii) changes in the value of
investments held by the company's pension plan and other defined
benefit plans, which could impact future required or voluntary
pension contributions; and (viii) the company’s ability to access
the capital markets on acceptable terms and conditions; (7) the
impact of a security breach or other significant disruption in the
company’s IT systems, those of its partners or suppliers or those
it sells to or operates or maintains for its customers; (8) the
outcome of ongoing and future tax matters; (9) the company's
ability to purchase sufficient materials, parts and components to
meet customer demand, particularly in light of global economic
conditions and reductions in the company’s purchasing power; (10)
risks related to dependence on certain key suppliers,
subcontractors, third-party distributors and other representatives;
(11) the impact on the company's performance and financial results
from strategic acquisitions or divestitures; (12) risks related to
the company's manufacturing and business operations in foreign
countries; (13) the creditworthiness of the company's customers and
distributors, particularly purchasers of large infrastructure
systems; (14) the ownership of certain logos, trademarks, trade
names and service marks including “MOTOROLA” by Motorola Mobility
Holdings, Inc.; (15) variability in income received from licensing
the company's intellectual property to others, as well as expenses
incurred when the company licenses intellectual property from
others; (16) unexpected liabilities or expenses, including
unfavorable outcomes to any pending or future litigation or
regulatory or similar proceedings; (17) the impact of the
percentage of cash and cash equivalents held outside of the United
States; (18) the ability of the company to pay future dividends due
to possible adverse market conditions or adverse impacts on the
company’s cash flow; (19) the ability of the company to complete
acquisitions or repurchase shares under its repurchase program due
to possible adverse market conditions or adverse impacts on the
company’s cash flow; (20) the impact of changes in governmental
policies, laws or regulations; (21) negative consequences from the
company's use of third party vendors for various activities,
including certain manufacturing operations, information technology
and administrative functions; and (22) the company’s ability to
settle the par value of its Senior Convertible Notes in cash.
Motorola Solutions undertakes no obligation to publicly update any
forward-looking statement or risk factor, whether as a result of
new information, future events or otherwise
DEFINITIONS
1 Organic revenue reflects net sales calculated under GAAP
excluding net sales from acquired business owned for less than four
full quarters and excluding the effects of ASC 606.
2 Free cash flow represents operating cash flow less capital
expenditures.
ABOUT MOTOROLA SOLUTIONS
Motorola Solutions (NYSE: MSI) creates mission-critical
communications solutions, including devices, networks, services,
software and video, that help public safety and commercial
customers build safer cities and thriving communities. For ongoing
news, visit www.motorolasolutions.com/newsroom or subscribe to a
news feed.
MOTOROLA, MOTOROLA SOLUTIONS and the Stylized M Logo are
trademarks or registered trademarks of Motorola Trademark Holdings,
LLC and are used under license. All other trademarks are the
property of their respective owners. ©2018 Motorola Solutions, Inc.
All rights reserved.
GAAP-1 Motorola Solutions, Inc. and Subsidiaries
Condensed Consolidated Statements of Operations (In
millions, except per share amounts)
Three Months Ended June 30, 2018 July 1,
2017 Net sales from products $ 1,042 $ 848 Net sales from
services 718 649 Net sales 1,760 1,497
Costs of products sales 485 392 Costs of services sales
453 415 Costs of sales 938 807
Gross margin 822 690
Selling, general and administrative expenses 316 254 Research and
development expenditures 162 138 Other charges 18 — Intangibles
amortization 53 37 Operating earnings
273 261 Other income (expense):
Interest expense, net (58 ) (51 ) Losses on sales of investments
and businesses, net (1 ) (1 ) Other 13 (4 )
Total other expense (46 ) (56 ) Net earnings before
income taxes 227 205 Income tax expense 46 73
Net earnings 181 132 Less: Earnings attributable to
noncontrolling interests 1 1 Net
earnings attributable to Motorola Solutions, Inc. $ 180 $
131
Earnings per common
share:
Basic $ 1.11 $ 0.80 Diluted $ 1.05 $ 0.78
Weighted average
common shares outstanding:
Basic 162.2 163.1 Diluted 171.7 169.0
Percentage of Net Sales* Net sales from
products 59.2 % 56.6 % Net sales from services 40.8 %
43.4 % Net sales 100.0 % 100.0 % Costs of products sales
46.5 % 46.2 % Costs of services sales 63.1 % 63.9 %
Costs of sales 53.3 % 53.9 % Gross margin 46.7
% 46.1 % Selling, general and administrative expenses
18.0 % 17.0 % Research and development expenditures 9.2 % 9.2 %
Other charges 1.0 % — % Intangibles amortization 3.0 %
2.5 % Operating earnings 15.5 % 17.4 %
Other income (expense): Interest expense, net (3.3 )% (3.4 )%
Losses on sales of investments and businesses, net (0.1 )% (0.1 )%
Other 0.7 % (0.3 )% Total other expense (2.6
)% (3.7 )% Net earnings before income taxes 12.9 % 13.7 %
Income tax expense 2.6 % 4.9 % Net earnings
10.3 % 8.8 % Less: Earnings attributable to
noncontrolling interests 0.1 % 0.1 % Net earnings attributable to
Motorola Solutions, Inc. 10.2 % 8.8 % * Percentages
may not add up due to rounding
GAAP-2 Motorola Solutions,
Inc. and Subsidiaries Condensed Consolidated Statements of
Operations (In millions, except per share amounts)
Six Months Ended June 30,
2018 July 1, 2017 Net sales from products $ 1,842
$ 1,551 Net sales from services 1,385 1,226
Net sales 3,227 2,777 Costs of products sales
867 739 Costs of services sales 869 778
Costs of sales 1,736 1,517 Gross margin 1,491
1,260 Selling, general and
administrative expenses 594 500 Research and development
expenditures 314 273 Other charges 44 (19 ) Intangibles
amortization 94 73 Operating earnings
445 433 Other income (expense):
Interest expense, net (104 ) (102 ) Gains on sales of investments
and businesses, net 10 2 Other 16 (9 ) Total
other expense (78 ) (109 ) Net earnings before income
taxes 367 324 Income tax expense 69 114
Net earnings 298 210 Less: Earnings attributable to
noncontrolling interests 1 2 Net
earnings attributable to Motorola Solutions, Inc. $ 297 $
208
Earnings per common
share:
Basic $ 1.83 $ 1.27 Diluted $ 1.73 $ 1.23
Weighted average
common shares outstanding:
Basic 161.7 163.7 Diluted 171.1 169.5
Percentage of Net Sales* Net sales from
products 57.1 % 55.9 % Net sales from services 42.9 %
44.1 % Net sales 100.0 % 100.0 % Costs of products sales
47.1 % 47.6 % Costs of services sales 62.7 % 63.5 %
Costs of sales 53.8 % 54.6 % Gross margin 46.2
% 45.4 % Selling, general and administrative expenses
18.4 % 18.0 % Research and development expenditures 9.7 % 9.8 %
Other charges 1.4 % (0.7 )% Intangibles amortization 2.9 %
2.6 % Operating earnings 13.8 % 15.6 %
Other income (expense): Interest expense, net (3.2 )% (3.7 )% Gains
on sales of investments and businesses, net 0.3 % 0.1 % Other
0.5 % (0.3 )% Total other expense (2.4 )%
(3.9 )% Net earnings before income taxes 11.4 % 11.7 %
Income tax expense 2.1 % 4.1 % Net earnings
9.2 % 7.6 % Less: Earnings attributable to
noncontrolling interests — % 0.1 % Net earnings attributable to
Motorola Solutions, Inc. 9.2 % 7.5 % * Percentages
may not add up due to rounding
GAAP-3 Motorola Solutions,
Inc. and Subsidiaries Condensed Consolidated Balance
Sheets (In millions) June
30, 2018 December 31, 2017 Assets Cash and cash
equivalents $ 878 $ 1,205 Restricted cash 63
63 Total cash and cash equivalents 941
1,268 Accounts receivable, net 1,159 1,523 Contract assets
760 — Inventories, net 391 327 Other current assets 330
832 Total current assets 3,581
3,950 Property, plant and equipment, net 895
856 Investments 172 247 Deferred income taxes 945 1,023 Goodwill
1,528 938 Intangible Assets 1,340 861 Other assets 420
333
Total assets $ 8,881 $ 8,208
Liabilities and Stockholders' Equity Current portion
of long-term debt $ 347 $ 52 Accounts payable 430 593 Contract
liabilities 1,049 — Accrued liabilities 1,096
2,286 Total current liabilities 2,922
2,931 Long-term debt 5,298 4,419 Other liabilities
2,153 2,585 Total Motorola Solutions, Inc. stockholders’
equity (deficit) (1,507 ) (1,742 ) Noncontrolling interests
15 15
Total liabilities and
stockholders’ equity $ 8,881 $ 8,208
GAAP-4 Motorola Solutions, Inc. and Subsidiaries
Condensed Consolidated Statements of Cash Flows (In
millions) Three Months Ended
June 30, 2018 July 1, 2017 Operating
Net earnings attributable to Motorola Solutions, Inc. $ 180 $ 131
Earnings attributable to noncontrolling interests 1
1 Net earnings 181 132 Adjustments to reconcile Net
earnings to Net cash provided by (used for) operating activities:
Depreciation and amortization 96 86 Non-cash other charges 3 6
Non-U.S. pension settlement loss — 16 Share-based compensation
expense 17 16 Losses on sales of investments and businesses, net 1
1 Changes in assets and liabilities, net of effects of
acquisitions, dispositions, and foreign currency translation
adjustments: Accounts receivable, contract assets and contract
liabilities 11 (117 ) Inventories 46 (43 ) Other current assets 41
38 Accounts payable and accrued liabilities 10 (33 ) Other assets
and liabilities (5 ) 31 Deferred income taxes 24
40 Net cash (used for) provided by operating
activities 425 173
Investing
Acquisitions and investments, net (28 ) (34 ) Proceeds from sales
of investments and businesses, net 2 19 Capital expenditures
(41 ) (53 ) Net cash used for investing activities
(67 ) (68 )
Financing Repayment of debt (147 ) (5 )
Net proceeds from issuance of debt (1 ) — Proceeds from financing
through capital leases — 7 Issuance of common stock 6 6 Purchases
of common stock — (80 ) Payments of dividends (84 ) (77 ) Payment
of dividend to non-controlling interest (1 ) (2 ) Net
cash used for financing activities (227 ) (151 )
Effect of exchange rate changes on cash and cash
equivalents (48 ) 22 Net increase (decrease)
in cash and cash equivalents 83 (24 ) Cash and cash equivalents,
beginning of period 858 829 Cash and
cash equivalents, end of period $ 941 $ 805
Financial Ratios: Free cash flow* $ 384 $ 120 *Free
cash flow = Net cash provided by operating activities - Capital
Expenditures
GAAP-5 Motorola Solutions, Inc. and
Subsidiaries Condensed Consolidated Statements of Cash
Flows (In millions) Six
Months Ended June 30, 2018 July 1, 2017
Operating Net earnings attributable to Motorola Solutions,
Inc. $ 297 $ 208 Earnings attributable to noncontrolling interests
1 2 Net earnings 298 210 Adjustments to
reconcile Net earnings to Net cash provided by (used for) operating
activities: Depreciation and amortization 178 166 Non-cash other
charges 6 21 Non-U.S. pension settlement loss — 25 Share-based
compensation expense 34 33 Gains on sales of investments and
businesses, net (10 ) (2 ) Changes in assets and liabilities, net
of effects of acquisitions, dispositions, and foreign currency
translation adjustments: Accounts receivable, contract assets and
contract liabilities 206 251 Inventories 37 (112 ) Other current
assets 43 (21 ) Accounts payable and accrued liabilities (340 )
(340 ) Other assets and liabilities (558 ) 21 Deferred income taxes
31 63 Net cash provided by (used for)
operating activities (75 ) 315
Investing Acquisitions and investments, net (1,153 ) (140 )
Proceeds from sales of investments and businesses, net 79 72
Capital expenditures (82 ) (121 ) Net cash used for
investing activities (1,156 ) (189 )
Financing
Repayment of debt (197 ) (6 ) Net proceeds from issuance of debt
1,295 — Proceeds from financing through capital leases — 7 Issuance
of common stock 59 28 Purchases of common stock (66 ) (258 )
Payments of dividends (168 ) (154 ) Payment of dividend to
non-controlling interest (1 ) (2 ) Net cash provided
by (used for) financing activities 922 (385 )
Effect of exchange rate changes on cash and cash
equivalents (18 ) 34 Net decrease in cash and
cash equivalents (327 ) (225 ) Cash and cash equivalents, beginning
of period 1,268 1,030 Cash and cash
equivalents, end of period $ 941 $ 805
Financial Ratios: Free cash flow* $ (157 ) $ 194
*Free cash flow = Net cash provided by operating activities -
Capital Expenditures
GAAP-6 Motorola Solutions, Inc. and
Subsidiaries Segment Information (In millions)
Net
Sales Three Months
Ended June 30, 2018 July
1, 2017 % Change Products and systems integration $
1,189 $ 1,047 14 % Services and software 571
450 27 % Total Motorola Solutions $ 1,760 $ 1,497
18 %
Six Months Ended
June 30, 2018 July 1, 2017 %
Change Products and systems integration $ 2,141 $ 1,901 13 %
Services and software 1,086 876 24 %
Total Motorola Solutions $ 3,227 $ 2,777 16 %
Operating Earnings Three Months
Ended June 30, 2018 July 1,
2017 % Change Products and systems integration $ 175 $
190 (8 )% Services and software 98 71
38 % Total Motorola Solutions $ 273 $ 261 5 %
Six Months Ended June
30, 2018 July 1, 2017 % Change Products and
systems integration $ 265 $ 287 (8 )% Services and software
180 146 23 % Total Motorola Solutions $ 445
$ 433 3 %
Operating Earnings % Three
Months Ended June 30, 2018 July 1,
2017 Products and systems integration 14.7 % 18.1 % Services
and software 17.2 % 15.8 % Total Motorola Solutions 15.5 %
17.4 %
Six Months Ended
June 30, 2018 July 1, 2017 Products and
systems integration 12.4 % 15.1 % Services and software 16.6 % 16.7
% Total Motorola Solutions 13.8 % 15.6 %
Non-GAAP-1
Motorola Solutions, Inc. and Subsidiaries Non-GAAP
Adjustments (Intangibles Amortization Expense, Share-Based
Compensation Expense and Highlighted Items)
Q1 2018 Non-GAAP
Adjustments Statement Line PBT
(Inc)/Exp
Tax
Inc/(Exp)
PAT
(Inc)/Exp
EPS impact Share-based compensation expense Cost of
sales, SG&A and R&D $ 17 $ 4 $ 13 $ 0.08 Reorganization of
business charges Cost of sales and Other charges 13 3 10 0.06
Intangibles amortization expense Intangibles amortization 41 8 33
0.19 Loss on legal settlements Other charges 1 — 1 0.01 Loss on
derivative instruments related to Avigilon Other expense 14 4 10
0.06 Release of FIN 48 reserve Income tax benefit — 1 (1 ) (0.01 )
Sale of investments Sale of Investment or Business (Gain) or Loss
(11 ) (3 ) (8 ) (0.05 ) Acquisition-related transaction fees Other
charges 17 5 12 0.07 Total impact on
Net earnings $ 92 $ 22 $ 70 $ 0.41
Q2 2018
Non-GAAP Adjustments Statement Line PBT
(Inc)/Exp
Tax
Inc/(Exp)
PAT
(Inc)/Exp
EPS impact Share-based compensation expense Cost of
sales, SG&A and R&D $ 17 $ 4 $ 13 $ 0.08 Reorganization of
business charges Cost of sales and Other charges 25 6 19 0.10
Intangibles amortization expense Intangibles amortization 53 12 41
0.23 Avigilon purchase accounting adjustment Cost of sales 10 3 7
0.04 Sale of investments Sale of Investment or Business (Gain) or
Loss 1 — 1 0.01
Loss on foreign currency related to
Avigilon purchase
Other expense 1 — 1 0.01 FIN 48 reserve Income tax expense — (1 ) 1
0.01 State audit settlement Income tax benefit — 12 (12 ) (0.07 )
Total impact on Net earnings $ 107 $ 36
$ 71 $ 0.41
Non-GAAP-2 Motorola Solutions, Inc. and
Subsidiaries Non-GAAP Segment Information (In
millions)
Net Sales Three
Months Ended June 30, 2018
July 1, 2017 % Change Products and systems
integration $ 1,189 $ 1,047 14 % Services and software 571
450 27 % Total Motorola Solutions $ 1,760
$ 1,497 18 %
Six Months
Ended June 30, 2018 July 1,
2017 % Change Products and systems integration $ 2,141 $
1,901 13 % Services and software 1,086 876
24 % Total Motorola Solutions $ 3,227 $ 2,777
16 %
Non-GAAP Operating Earnings Three
Months Ended June 30, 2018 July
1, 2017 % Change Products and systems integration $ 226
$ 204 11 % Services and software 152 112
36 % Total Motorola Solutions $ 378 $ 316 20 %
Six Months Ended
June 30, 2018 July 1, 2017 % Change Products
and systems integration $ 350 $ 306 14 % Services and software
287 222 29 % Total Motorola Solutions $
637 $ 528 21 %
Non-GAAP Operating Earnings %
Three Months Ended
June 30, 2018 July 1, 2017 Products and systems
integration 19.0 % 19.5 % Services and software 26.6 % 24.9 % Total
Motorola Solutions 21.5 % 21.1 %
Six Months Ended June 30, 2018 July
1, 2017 Products and systems integration 16.3 % 16.1 % Services
and software 26.4 % 25.3 % Total Motorola Solutions 19.7 %
19.0 %
Non-GAAP-3 Motorola Solutions, Inc. and
Subsidiaries Operating Earnings after Non-GAAP
Adjustments
Q1 2018
TOTAL
Products and Systems
Integration
Services and Software Net sales $ 1,468 $ 952 $ 516
Operating earnings ("OE") $ 171 $ 90 $ 81
Above-OE non-GAAP adjustments: Share-based
compensation expense 17 12 5 Reorganization of business charges 13
9 4 Intangibles amortization expense 41 1 40 Acquisition-related
transaction fees 17 12 5 Loss on legal settlements 1
1 — Total above-OE non-GAAP adjustments
89 35 54 Operating earnings
after non-GAAP adjustments $ 260 $ 125 $ 135
Operating earnings as a percentage of
net sales - GAAP 11.6 % 9.5 % 15.7 % Operating earnings as a
percentage of net sales - after non-GAAP adjustments 17.7 %
13.1 % 26.2 %
Q2 2018
TOTAL
Products and Systems
Integration
Services and Software Net sales $ 1,760 $ 1,189 $ 571
Operating earnings ("OE") $ 273 $ 175 $ 98
Above-OE non-GAAP adjustments: Share-based
compensation expense 17 12 5 Reorganization of business charges 25
19 6 Intangibles amortization expense 53 10 43 Avigilon purchase
accounting adjustment 10 10 —
Total above-OE non-GAAP adjustments 105 51 54
Operating earnings after non-GAAP adjustments
$ 378 $ 226 $ 152
Operating earnings as a percentage of net sales - GAAP 15.5 % 14.7
% 17.2 % Operating earnings as a percentage of net sales - after
non-GAAP adjustments 21.5 % 19.0 % 26.6 %
Non-GAAP-4 Motorola Solutions, Inc. and Subsidiaries
Non-GAAP Organic Revenue Total Motorola Solutions
Three Months Ended
June 30, 2018 July 1,
2017 % Change Net sales $ 1,760 $ 1,497
18 % Non-GAAP adjustments: Acquisitions (154 ) — ASC
606 impact (24 ) — Organic revenue
1,582 1,497 6 % Less foreign exchange impact
(26 ) — Organic revenue in constant
currency $ 1,556 $ 1,497 4 %
Six Months Ended
June 30, 2018 July 1, 2017 % Change Net sales
$ 3,227 $ 2,777 16 % Non-GAAP adjustments:
Acquisitions (206 ) (5 ) ASC 606 impact (39 ) —
Organic revenue 2,982 2,772 8 %
Less foreign exchange impact (65 ) —
Organic revenue in constant currency $ 2,917 $ 2,772
5 %
View source
version on businesswire.com: https://www.businesswire.com/news/home/20180802005889/en/
MEDIA CONTACTTama McWhinneyMotorola Solutions+1
847-538-1865tama.mcwhinney@motorolasolutions.comorINVESTOR
CONTACTChris KutsorMotorola Solutions+1
847-576-4995chris.kutsor@motorolasolutions.com
Grafico Azioni Motorola Solutions (NYSE:MSI)
Storico
Da Set 2024 a Ott 2024
Grafico Azioni Motorola Solutions (NYSE:MSI)
Storico
Da Ott 2023 a Ott 2024