Other Financial Data | Other Financial Data Statements of Operations Information Other Charges (Income) Other charges (income) included in Operating earnings consist of the following: Three Months Ended Six Months Ended July 1, July 2, July 1, July 2, Other charges: Intangibles amortization $ 37 $ 38 $ 73 $ 52 Reorganization of business 1 19 16 25 Building impairment — 17 8 17 Non-U.S. pension settlement loss 16 — 25 — Legal settlements (1 ) — (44 ) — Acquisition-related transaction fees — — 1 13 $ 53 $ 74 $ 79 $ 107 During the six months ended July 1, 2017 , the Company recognized a net gain of $44 million related to legal settlements. Of this amount, $42 million relates to the recovery, through legal procedures to seize and liquidate assets, of financial receivables owed to the Company by a former customer of its legacy Networks business. The net gain of $42 million was based on $52 million of proceeds received, net $10 million of fees owed to third parties for their involvement in the recovery. Other Income (Expense) Interest expense, net, and Other, both included in Other income (expense), consist of the following: Three Months Ended Six Months Ended July 1, July 2, July 1, July 2, Interest income (expense), net: Interest expense $ (55 ) $ (59 ) $ (109 ) $ (111 ) Interest income 4 5 7 8 $ (51 ) $ (54 ) $ (102 ) $ (103 ) Other: Foreign currency gain (loss) $ (20 ) $ 14 $ (22 ) $ 27 Gain (loss) on derivative instruments 18 (18 ) 11 (30 ) Gains on equity method investments 1 — — 2 Realized foreign currency loss on acquisition — — — (10 ) Other 1 — 2 — $ — $ (4 ) $ (9 ) $ (11 ) Earnings Per Common Share The computation of basic and diluted earnings per common share is as follows: Amounts attributable to Motorola Solutions, Inc. common stockholders Three Months Ended Six Months Ended July 1, July 2, July 1, July 2, Basic earnings per common share: Earnings $ 131 $ 107 $ 208 $ 124 Weighted average common shares outstanding 163.1 171.9 163.7 173.0 Per share amount $ 0.80 $ 0.62 $ 1.27 $ 0.72 Diluted earnings per common share: Earnings $ 131 $ 107 $ 208 $ 124 Weighted average common shares outstanding 163.1 171.9 163.7 173.0 Add effect of dilutive securities: Share-based awards 3.1 2.4 3.2 2.4 Senior Convertible Notes 2.8 0.5 2.6 0.3 Diluted weighted average common shares outstanding 169.0 174.8 169.5 175.7 Per share amount $ 0.78 $ 0.61 $ 1.23 $ 0.71 In the computation of diluted earnings per common share for the three months ended July 1, 2017 , the assumed exercise of 2.1 million options, including 1.8 million subject to market-based contingent stock agreements, were excluded because their inclusion would have been antidilutive. For the six months ended July 1, 2017 , the assumed exercise of 2.4 million options, including 2.0 million subject to market-based contingent stock agreements, were excluded because their inclusion would have been antidilutive. For the three months ended July 2, 2016 , the assumed exercise of 2.3 million options, including 2.1 million subject to market-based contingent stock agreements, and the assumed vesting of 0.6 million restricted stock units ("RSUs") were excluded because their inclusion would have been antidilutive. For the six months ended July 2, 2016 , the assumed exercise of 3.2 million options, including 2.1 million subject to market-based contingent stock agreements, and the assumed vesting of 0.6 million RSUs were excluded because their inclusion would have been antidilutive. On August 25, 2015, the Company issued $1.0 billion of 2% Senior Convertible Notes which mature in September 2020 (the "Senior Convertible Notes"). The notes are convertible based on a conversion rate of 14.5985 per $1,000 principal amount (which is equal to an initial conversion price of $68.50 per share). In the event of conversion, the Company intends to settle the principal amount of the Senior Convertible Notes in cash. Because of the Company’s intention to settle the par value of the Senior Convertible Notes in cash upon conversion, the Company does not reflect any shares underlying the Senior Convertible Notes in its diluted weighted average shares outstanding until the average stock price per share for the period exceeds the conversion price. In this case, only the number of shares that would be issuable (under the treasury stock method of accounting for share dilution) will be included, which is based upon the amount by which the average stock price exceeds the conversion price of $68.50 . For the three and six months ended July 1, 2017 , the dilutive impact of the Senior Convertible Notes was 2.8 million shares and 2.6 million shares, respectively. Balance Sheet Information Accounts Receivable, Net Accounts receivable, net, consists of the following: July 1, December 31, Accounts receivable $ 1,250 $ 1,454 Less allowance for doubtful accounts (39 ) (44 ) $ 1,211 $ 1,410 Inventories, Net Inventories, net, consist of the following: July 1, December 31, Finished goods $ 197 $ 151 Work-in-process and production materials 321 253 518 404 Less inventory reserves (127 ) (131 ) $ 391 $ 273 Other Current Assets Other current assets consist of the following: July 1, December 31, Available-for-sale securities $ 50 $ 46 Costs and earnings in excess of billings 529 495 Tax-related refunds receivable 110 90 Other 115 124 $ 804 $ 755 Property, Plant and Equipment, Net Property, plant and equipment, net, consists of the following: July 1, December 31, Land $ 10 $ 12 Building 267 306 Machinery and equipment 2,078 1,921 2,355 2,239 Less accumulated depreciation (1,496 ) (1,450 ) $ 859 $ 789 Depreciation expense for the three months ended July 1, 2017 and July 2, 2016 was $49 million and $44 million , respectively. Depreciation expense for the six months ended July 1, 2017 and July 2, 2016 was $93 million and $92 million , respectively. Investments Investments consist of the following: July 1, 2017 Cost Unrealized Investments Available-for-sale securities: Government, agency, and government-sponsored enterprise obligations $ 56 $ — $ 56 Corporate bonds 5 — 5 Common stock 5 7 12 66 7 73 Other investments 210 — 210 Equity method investments 15 — 15 $ 291 $ 7 $ 298 Less: current portion of available-for-sale securities 50 $ 248 December 31, 2016 Cost Unrealized Investments Available-for-sale securities: Government, agency, and government-sponsored enterprise obligations $ 51 $ — $ 51 Corporate bonds 5 — 5 56 — 56 Other investments 211 — 211 Equity method investments 17 — 17 $ 284 $ — $ 284 Less: current portion of available-for-sale securities 46 $ 238 Other investments include strategic investments in non-public technology-driven startup companies recorded at cost of $74 million and $76 million , and insurance policies recorded at their cash surrender value of $136 million and $135 million , at July 1, 2017 and December 31, 2016 . During the three months ended July 1, 2017 , the Company recognized a loss on the sale of investments and businesses of $1 million , compared to a gain of $1 million during the three months ended July 2, 2016 . During the six months ended July 1, 2017 , the Company recognized a gain on the sale of investments and businesses of $2 million , compared to a loss of $20 million during the six months ended July 2, 2016 , of which, $19 million was associated with the sale of United Kingdom treasury securities. Other Assets Other assets consist of the following: July 1, December 31, Long-term receivables 35 49 Defined benefit plan assets 125 102 Other 40 49 $ 200 200 Accrued Liabilities Accrued liabilities consist of the following: July 1, December 31, Deferred revenue $ 427 $ 439 Compensation 171 250 Billings in excess of costs and earnings 387 434 Tax liabilities 134 111 Dividend payable 76 77 Trade liabilities 174 180 Other 555 620 $ 1,924 $ 2,111 Other Liabilities Other liabilities consist of the following: July 1, December 31, Defined benefit plans $ 1,800 $ 1,799 Deferred revenue 164 115 Unrecognized tax benefits 39 39 Deferred income taxes 139 121 Deferred consideration (Note 13) 78 72 Other 220 209 $ 2,440 $ 2,355 Stockholders’ Equity Share Repurchase Program: Through actions taken on July 28, 2011, January 30, 2012, July 25, 2012, July 22, 2013, November 3, 2014, and August 3, 2016, the Board of Directors has authorized the Company to repurchase in the aggregate up to $14.0 billion of its outstanding shares of common stock (the “share repurchase program”). The share repurchase program does not have an expiration date. During the six months ended July 1, 2017 , the Company paid an aggregate of $258 million , including transaction costs, to repurchase approximately 3.2 million shares at an average price of $81.66 per share. As of July 1, 2017 , the Company had used approximately $12.1 billion of the share repurchase authority, including transaction costs, to repurchase shares, leaving $1.9 billion of authority available for future repurchases. Payment of Dividends: During the three months ended July 1, 2017 and July 2, 2016 , the Company paid $77 million and $72 million , respectively, in cash dividends to holders of its common stock. During the six months ended July 1, 2017 and July 2, 2016 , the Company paid $154 million and $143 million , respectively, in cash dividends to holders of its common stock. Accumulated Other Comprehensive Loss The following table displays the changes in Accumulated other comprehensive loss, including amounts reclassified into income, and the affected line items in the condensed consolidated statements of operations during the three and six months ended July 1, 2017 and July 2, 2016 : Three Months Ended Six Months Ended July 1, July 2, July 1, July 2, Foreign Currency Translation Adjustments: Balance at beginning of period $ (460 ) $ (253 ) $ (494 ) $ (266 ) Other comprehensive income (loss) before reclassification adjustment 47 (98 ) 84 (84 ) Tax expense — — (3 ) (1 ) Other comprehensive income (loss), net of tax 47 (98 ) 81 (85 ) Balance at end of period $ (413 ) $ (351 ) $ (413 ) $ (351 ) Available-for-Sale Securities: Balance at beginning of period $ — $ 1 $ — $ (3 ) Other comprehensive income (loss) before reclassification adjustment 7 (2 ) 7 (2 ) Tax (expense) benefit (3 ) 1 (3 ) 1 Other comprehensive income (loss) before reclassification adjustment, net of tax 4 (1 ) 4 (1 ) Reclassification adjustment into Gains (losses) on sales of investments and businesses, net — — — 6 Tax benefit — — — (2 ) Reclassification adjustment into Gains (losses) on sales of investments and businesses, net of tax — — — 4 Other comprehensive income (loss), net of tax 4 (1 ) 4 3 Balance at end of period $ 4 $ — $ 4 $ — Defined Benefit Plans: Balance at beginning of period (1,804 ) (1,593 ) $ (1,823 ) $ (1,597 ) Other comprehensive income (loss) before reclassification adjustment (11 ) 53 (11 ) 53 Tax expense — (16 ) — (16 ) Other comprehensive income (loss) before reclassification adjustment, net of tax (11 ) 37 (11 ) 37 Reclassification adjustment - Actuarial net losses into Selling, general, and administrative expenses 16 18 32 28 Reclassification adjustment - Prior service benefits into Selling, general, and administrative expenses (4 ) (7 ) (8 ) (13 ) Reclassification adjustment - Non-U.S. pension settlement loss into Other charges 16 — 25 — Tax expense (benefit) (3 ) 8 (5 ) 8 Reclassification adjustment into Operating earnings, net of tax 25 19 44 23 Other comprehensive income, net of tax 14 56 33 60 Balance at end of period $ (1,790 ) $ (1,537 ) $ (1,790 ) $ (1,537 ) Total Accumulated other comprehensive loss $ (2,199 ) $ (1,888 ) $ (2,199 ) $ (1,888 ) |