MSI - Earnings call transcript Q1 2020 | Motorola Solutions, Inc.

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Operator

Good afternoon and welcome to the First Quarter 2020, Motorola Solutions Earnings Conference Call. All participants will be in listen-only mode. [Operator Instructions]. Please note this event is being recorded.

I would now like to turn the conference over to Tim Yocum, Vice President of Investor Relations. ahead. go Please

Tim Yocum

Vice Q&A. to & me Welcome will and Gino the first earnings review Vice along Molloy, quarter Executive and results & Good Mark, our Greg Kelly are our and and Greg Jack join With Executive Executive Jack CFO; today President of CEO; commentary, of Brown, call. Kelly Products Vice Sales; Software afternoon. President and XXXX President Services. Chairman with Bonanotte, will and Gino

We've presentation to motorolasolutions.com/investor. reconciliations non-GAAP during earnings those posted materials for These noted. we’ll otherwise including call And at an in release news and unless our reference. include reference non-GAAP GAAP results, the outlook, financial your

the on differ Q&A are these of of These of statements expectations a subject Actual call. current results portion number could materially statements made forward-looking during during A the based assumptions be and uncertainties. variety to from will that and risks are statements. this and forward-looking presentation

factors the such about this forward-looking could cause in the not statement. and in call, comments on our made XX-K, our Annual any Form any be news update do with earnings other Report risk differences to release, in XXXX that filings found conference section during today's SEC. and of We the Information in factors undertake reports can duty

And with that, I’ll turn it over to Greg.

Greg Brown

Gino start afternoon, Thanks before joining through sharing us by off I’ll few QX thanks a quarter Time. on results today. outlook. and business takes Good us and our thoughts the for second

commitment and mid-March do of the customers. made workforce I'd majority their XX,XXX and for more resilience, people our than to like shown always our reliable jobs to around transitioned We thanking homes to fearless unwavering world to on. dedication in safety their vast to that remotely have operation centers our decision First, the they've adaptability the sites have by customers, start a and who remain our and successfully customer on-site and of critical their leaving new their the ensure mission to our Those work needed environments. to smoothly

these say the thankful that our to of keeping and I’d we're gone great this, of Because us we're responsibility lengths support of also healthcare to to unprecedented to the be actions and of for safe, times. safety I them aware deeply could employees have their acutely community during like our professionals that continue and are our them public to more proud efforts. not and

despite operating generated the XX% by expanded earnings Second, the cash brought by of prior quarter, per margins challenges XX% year. $XXX an grew operating million flow, increase we and points basis by during on the of COVID-XX share XXX versus

Additionally, America, North see $XX expanded the Solutions, operating of margins for we points. to the a a million Security by from Software and sales business, XXX XX% & Services Avigilon the our by our order large continue segment grew order history single highlighted Video utility basis largest demand strong by in in and

uncertainties and the pandemic our impact while for critical confirmed need fundamental its solutions, the finally, And severity, it's brought also duration. has COVID-XX surrounding mission

guidance year of we result at we decision quarter have that the We'll the the So to full this on our this at clarity time. end and at decision as based a information made second time. withdraw reassess the

returning provide additional turn QX second for that, Gino before with And call I'll the over quarter closing our some now to outlook, and details on thoughts.

Gino Bonanotte

year is revenue million ago operating including up million $XX includes year $X a of in $XXX of billion, $XX million earnings of GAAP headwind. quarter. $X.X from of revenue ago, Thank you, acquisitions and operating XX.X% flat of million of to Greg. XX.X% sales margin versus and QX compared currency the

by or GAAP higher sales, up from of XX% up points XXX $XXX of operating margins earnings $XX driven operating basis XX% million million of XX%, non and gross Non-GAAP margin.

to tax compared on $X.XX in lower $X.XX $X.XX effective per quarter. earnings operating a the last up higher $X.XX year in year and EPS of ago rate XX% earnings the GAAP of current from Non-GAAP share quarter.

to OpEx partially in share million costs lower to and to and offset QX incentives tax was XX% year, compared decrease due versus to The effect the based acquisitions. prior by tax primarily higher primarily in expenses, lower was compensation. million, down legal $XXX related of $XX The year-over-year last QX excess XX% due year. benefits rate was

prior Turning year was operating increase in million to $XXX primarily was improved in capital. was $XXX million cash with flow cash in million million cash to flow QX $XXX and compared prior The flow, flow cash with compared $XXX due working year-over-year free the year. the

the repurchases, for acquisition. share million CapEx Capital cash quarter of $XX in million $XX of allocation for $XXX and included dividends, $XXX million million

the out cash and have of an facility. we revolving ended draw revolver. million caution, the down our to committed of remaining abundance in with made capacity decision from We quarter Additionally, of $XXX an $X.X $X.X on the credit billion undrawn billion additional

to numerous past our debt de-risk years our We've liability. the and restructure over profile also actions several pension taken maturity

As a maturities and us the no XXXX XXXX. provides with capital deployment opportunity the expected contribution the liquidity XXXX for absent pension balance no have future. The revolver acquisition in flexibility sheet result, until strong in we debt or position and

a were were growth by down by X% Radio, headwinds Commercial segment or $XXX in to Revenue results, products currency driven in strong million quarter from and $X systems Moving Security. $XX QX million. million, Video and decline and was Professional $XX acquisitions offset the sales in partially integration million

Video for of Angeles for Germany's Security $XX PXX million into governments million million $X Video $XX million from as $XX PXX for $XX or customer entire Los portfolio, due were $XX QX; Dinwiddie revenue the across America, of points utility Security sales Virginia XX.X% include a California; which in Forces. was in lower order and of earnings over in sales, Notable County, large TETRA the year basis of North to Operating down XXX million order revenue. a recognized a wins for $XXX award segment QX last a million an Armed Port million order the

$X the was million. $XX and currency by XX% or last Operating sales, points up up & acquisitions quarter driven gross operating year, Services. million was driven Command of Software headwinds from XXX or Center $XX million $XXX million growth & Revenue to year, in Software basis by margins $XXX in Services, from Moving were leverage. XX.X% million higher and from earnings last were improved revenue

Command Notable with Latin QXs multi-year Ft. in the $X $X service and an million a a extension suite Wayne, Center Ontario; Center Ohio; million include suite Cleveland, services Indiana. $X a PXX Software in multi-year segment Software $X Command contract PXX with with contract contract million Brampton, America; million contract

realize EMEA, in Asia Pac efficiencies restructured region, one Accordingly, the America results, combining to and now more operational our which regional North Latin which at as is Looking regions; during America, United report reflected quarter the and two International. sales includes International. we States Canada, we net the operations into and now

billion, growth International Center QX in Command to Video up decline partially revenue & $X.X X% down QX a in $XXX Commercial X% Security, America million, revenue and decline in was driven offset Services, commercial in Asia Software primarily Pac. a and was radio. due by by North professional Radio, Professional

down of typical of North America currency year, million $XX.X billion, rates. ending inclusive backlog $XXX to Airwave Moving recognition unfavorable was order currency and million $XXX rate, seasonality. of compared last to $XX million unfavorable was due $XXX backlog contract revenue to and the of Sequentially million up backlog, ESN

unfavorable up year to due rate to partially of was by and million & currency Services America in $XXX multi-year compared growth rates. of due $XXX unfavorable primarily $XXX offset backlog $XXX was North million backlog ESN or and to million down currency recognition last for Software agreements, revenue Airwave. X% Sequentially million,

partially by $XX million, America. down last million in backlog to segment was Sequentially in year, North million Product primarily currency of or backlog was was A and decline unfavorable X% down of SI growth seasonality. order $XXX $XX North by America inclusive backlog typical compared driven rate. international offset

be and QX down weighted between between our non-GAAP diluted $XX to $XXX XX%, This XX% a million count headwinds and between rates, FX with million an outlook, tax $X.XX XX% at share we of EPS and current effective Turning approximately of XX%. average rate and approximately expect assumes to shares, $X.XX. of sales

now like the over turn to I’d Greg. back to call

Greg Brown

comments and Thanks business Gino. having impact on is would with regarding high full thought responding. I a level few we're our the COVID-XX how I year end

first pandemic customer. investing our in continue this cloud and delayed of will and an engagements businesses. parts our committed some CAD growth recently on development fully cloud disrupted customers impact with launched Command while to to certain are remain our move enabled have Center accelerating has our our we First, the In and business, we Software to

We also XXXX. end follow the of cloud CAD be to year XXX in fully expect our our in enabled solutions software this by with to records

HX our coverage. and solutions that sales enterprise the the camera traction and based Security and will radio, cloud continue I'm pleased analytics, also video our Video while invest In and with land to our in expanding continued business government customers, mobile line, features integrate VMS very with

strong cash durable position in flow sheet a unique going us our to opportunistic forward. acquisitions respect with Additionally, to be and generation put balance

which in Second, and operating we're other while $XXX third a areas slightly $XXX last lower to XXXX, now contractors in continue number more variable travel such decrease the by We is areas operating expand critical margins expenses should spend additional call. actions expenses. in million us is this lower we to reduction a on earnings operating to approximately taking reduce a This and year. driven be to our also this of versus compensation, time to discussed as invest, discretionary reduction to million annual and our than down allow real-estate expenses a for expect party

employees critical customers operations mission back-up critical in being this and positive COVID, responded it's helping of and years, network going our for or are for XX hospitals through the be coverage our of a Solutions teams to And proud line has needs of one. built to over move to more the number U.K. team command are to been couldn't finally, have customers where one center our have the people I Whether front for to days, on temporary their in great make Airwaves our enabling lengths tested mission our Motorola how met. providing their XXX managed team sure solutions customer crises, a location

We I side entered in the believe that absolutely of this and company an secure on pandemic it. other position very emerge a even stronger we’ll

call me this Tim. now, over back turn to And let

Tim Yocum

Thank you, Greg.

follow-up possible. taking to question participants Before as one one limit I accommodate many like questions, as to to to and begin callers remind themselves I'd

Operator, would to our question. the please line you ask callers a remind how on

Operator

from Long with Yes, Please ahead. question [Operator Instructions] thank first you. Tim go Our comes Barclays.

Tim Long

two Thank of the maybe for you. Yeah, them. just

versus much out how and safety? First much of thinking you of that what pass When help can QX – whole public the maybe was Gino one revenues in of expected, kind related how probably TCR the originally is quick in first. is about kind

like seems And the little overall know impacted bit It just you a the in then talk Greg, safety if public you events prior, than macro the could company's about world. being market. more

could So public different? about here Do is logistics? you change backdrop? talk you given other than fundamental little the What safety you. market do the bit just what's changes Thank macro see a other you the any driving to think

Gino Bonanotte

Jim, is this Hi Gino.

question, in Certain part we've impacted. clearly seen been the have the On of pressure significantly Commercial verticals and Radio. first Professional

think shelter-in-place shutdown for related can You specifically about oil pandemic gas, to airlines, manufacturing and the transportation, orders. the hospitality, and

frankly We talk in to customers to to have there's Obviously to being front through with talk April lasting terms dealing the terms through safety have our in able and public the in been some in pandemic May. work, our delayed, our of beginning but as markets delay and on site customers. certainly also been certainly larger of a lines that impact a really ability and engagements customers in both engagement mid-March, to are seen of

Command a to based verticals get it’s expect people guidance, Video important we And Command move embedded continue and Software sites. get to grow safety right, to as in But that Security said, in and that Center Video also Security logistics on Center in much QX. very public – certain note you and that impacted, dimensionally, as of to front characterized inability to and the PCR, to

Greg Brown

of Services but Center QX year. & company actually you even grow, do as public actually I think still still We as much know severity been grow Security I Tim right, The It a is, and to digits, of that safety. different could I expect have would look, this have. don't know years Software to to now good Software Video add several we're ago. than things mid-single pushed think we Services we to were we'll that grow. expect changed you think part have Software Yeah, though & I they – so see, Command in things news the grow and expect isn't the we

I think they've pushed. been

well the weeks continued locations domestically became in in three down states. lockdown in effectively major April. in May, here or as Two March That we has locked as

need-to-do think right it's see behavioral I and do structural pushing to decline, when things QX than we well a that at a but So really countries a public the as in a decline any nice-to-do, or is in pretty still sharpness versus the economic once. you crisis, changing as health extensive given the of look XXX-plus of public combination all it’s patterns that is situation obviously safety. to a the What at dramatic

time. So approach prudent hence this I our think point in at

still safety XX% and product full see. I could XX% will public and It -- low resilient we're and have I well be overall down the our right. year backlog as is digits; strength with be government to But with I for things our the the position enterprise, push we'll think business segment of think think again, double positioned. XX% about an of down to

Tim Long

Thank you, Greg.

Greg Brown

Yeah, sure Tim.

Operator

comes Adam Please Our ahead. Tindle Raymond with next go question James. from

Adam Tindle

Okay remember wanted to the what that I time to I Is sort thanks, the of at recover you how quarterly Greg, different the know year crisis. that? back there was good seeing during a this start, similar kind that maybe around if the was around or look a for that basis, digit mid-teen be down different, afternoon. the did on on full versus Do of you mid-single max-thing any basis? And revenue is but range. financial like-to-like business to QX. just time quickly also, somewhere decline kind last in of similarity and what it could you’re the going it

Greg Brown

are from had a like where Yeah, and market couldn't engagement difference out we We many and Great time get things of I bit standpoint again on Recession is an on is financial implementations, we little the pushed think here – the last literally. in what we've customers the side recovered, unlike services as the up, and well. front even seizing customers, in sales deployments, experienced

we're much time. think I better this position

little nature. sub time, last than mission rewind long that overall is tape that of Services business, recurring critical of a our a most term If & bit or was of revenue. I contracts, Software more the our XX% third largely in XX%

Even but months right, we've over other thing seen replenishment difficult on is, a get seeing few the though though to The having projects last and coming even comment we're QX, a pushed just this, the we’re Jack and of constant the in funnel. could weeks actually projects too.

and So pandemic. and of we in once just thought given the us fog guidance uniqueness time. and of the a century year suspend full this It kind at uncertainty this for to literally a was thing, prudent

think better But positioned. I are much we

been like has that think have radio in still radio in some is we the growth Software. expect things Command hit verticals Center for business, which expect think professional growth I we of serving video, and commercial The particularly and hit of hard airline, still the gaming hospitality, commercial, business hard. transportation, been

know don't if add you want anything. to I Jack,

Jack Molloy

things. Yeah, just a couple maybe of

things around open are the Pac certain who Asia globe, starting in countries hit to we up first. frankly in As was look

customers some with of So potentially back terms technology there moving of there's reengaging focus signs projects. encouragement in to customers,

safety, our held The conference second all also a we to their is of with that so Analytics had actually had video, of proud access lot rooms, virtual virtual I mechanisms, thing us because people for in way we the would that and and have pretty a control, by by attended staying encouraged the Video questions customers we and think school feel and an person, show engage attended in XX% our canceled was a of the conference had we're everything over those continuously but Business, team, and chat – from trade things. March virtually that literally actually of ability conference than more industry video, Security

focus has support and see improve work even we one customers to continue into any so with to the engagements to things. them. can actually starting our them states in taken just We pandemic certain here the April, way and Obviously it’s of we'll of

Adam Tindle

is Are way. COVID-XX shift talked as fear revenue, in Maybe that they happen customers options long is because Jack More way delayed see maybe impact with provide are to other potential save your and finally to you you Okay, state In there that and in that may a customers statement? that, money? near know the helpful. bigger ‘hey, engagement, we’ve a now catalyst that term, cannibalization and and on future been about that's can customers the of evaluating a follow-up. local way about LTE commentary worried color bigger on kind specifically, some which impact, a just that of Is this evaluating finding a deployments broadband.’ Greg are

Greg Brown

I in we No, fact the think; don't that. of see opposite

land, During alleged criticality radio of see versus the this we shift and or migration importance any time LTE. mobile, to

complementary; is it's positioned Actually NEXT advantage integrates that take APX an that's is of mobile, broadband best network product extension LTE to that. think with radio I of a land, our broadband LMR. data

I know starting no that opposite. commentary speculation the anything see no indication maybe to that or there's absolutely been LTE We of that, some that and is cannibalize. – suggests if

fact the XXX, puts with there in is fundamental there’s calls a and but purpose place, public of the networks, on LTE, terms obviously. need that And what maybe in multitude and here to one things safety the when a seen that just have said, a network? as built public evidence our of we device Obviously the Greg an of technology LEXXX, to importantly but which been is the APX strain the that. why we is LTE safety response you we’ve more collaborative it in a more see pandemic thing NEXT; focus is device So, in does add to have someone happened, we really and that PXX

good without left a capability bought really of fire department, traditionally wanted they EMS was into really city a a they that for tier major and the was a customer Motorola in people, secondary to and because to that NEXT. health backup it major front talk the specifics, obviously There city a when NEXT equipment APX APX department. health But terms big devices line example was getting also procured – needed but type high

customers not and has sites, – short QX being of been a really So as of challenge. to the to think we this physically seeing I engage lot with that has in that's really get really to challenge thing view what the kind ability been not we're term physical and a

Adam Tindle

Understood. the Thanks Stay safe. color. for

Operator

next Our George question ahead. comes from Please go with Jefferies. Notter

George Notter

Hi guys, you issue guess customer going through at around thanks know a you much. that I states engagement, what cycles very about just an mentioned point. follow-on but as budgeting Obviously it's budgets? this to are thought,

I receipts be know and counties a tax think down, going are certainly to situation. municipalities you similar

receipts tax So do economic of kind of you think out you sort of lower do more LMR the or immune that? to see businesses fall is Thanks. an

Jack Molloy

it’s hey So George, things. Jack. A couple

it's think state budgets. around written, always lot discussed lot important we a I and a see been – there's local

why made one that’s also that's a of which but because think lot important different to states, local federal XXX and The part of essentially tax, dollars, sales a and mean. of reality dollars, some funding to funding five streams: protected. six budgets transfer grant those what tax, budgets, command parcel, in I is there's streams very space, different in federal income center tax the we've real state of it's decompose acquisitions the property funding, reasons probably a confluence

Recession. at that's of XXX is gone – have So they're back kind benefits a public things, the we've it's may safety different, of number that little to deferred, protected. one in prioritized end seen get company as it we in technology know the of through gone what a when this in and gets you to but things, these responders. evidence delayed, of XX have of being the best old data, we've response things pandemic, at the back I a around and all Great the to close all we've years number of things may We we've but looked There's things. to But even those the – go get that suggests a think those hands day gets the and the first that those need of it other when after these you the seen margins

There's easy the always situations for local budget years. last way state – number been the by in the of and haven't

team, where our funding working everything, navigate as that's base. and I lastly have our team and work as think they our to at very plans customer they customers we’ve they that veteran much that's holistic there really relationships got are out focused plans sales a with very with

that I always think that with this come So more I think gotten, question. public of not the has same of so George, we’ll out safety level if your priority answers

George Notter

to look NGX-X-X I'm could sure you is NGX-X-X I a for see current opportunity in just not how from this interesting opportunity it, upgrades I Got stuff I'll here more. of in that, does guys funds package you dollars that – that much do brewing to pass think Solutions Congress obviously think billion as more seems you there's I plus great! know then Motorola know the trickle And going do? that’s an But administration, one ask those that these stimulus mean The and coming and been you $XX were down days. and package earmarked for like. there's drafts that what

Kelly Mark

Absolutely, and the XXX George, a broadband in as that in – call but we it's refresh it interest not see with is help into an the of operating their center lot been the on been remotely to able they part lot more it also as opportunity backbone need customers related NGX-X-X, for a of to it's definitely as the Kelly. it of associated that's where Hey which past there's just operate where with equipment something this result of turn there. to us, on-prem do been backbone, The basis our to an operate cloud a of is pandemic, in pandemic. introduced a of be this have a

in was investing We remarks, our already on and just completely based good our be enabled. early Greg you as mention been of we XXX in CAD we've all cloud investments now. first will portion in cloud But is be we're enabled year this cloud our see records already more software cloud heard of demand even accelerating our news – good in The a our the cloud launched By our and year enabled efforts we’ll as well. our portfolio the CAD, will cloud. next in customer end be the

So that the the software to definitely we it drive flow refresh. dollars those prioritize yes, some of does and of as see folks through center starting do but not just rest NGX-X-X, command

George Notter

thanks. Okay,

Operator

Our Keith Please comes with Northcoast ahead. go from next question Housum Research.

Unidentified Analyst

[Inaudible] CEO Hi, assessment? sales market Keith. for with that year. you LXHarris’s this is filling in this said by agree that decline Do XX% recently could LMR

Greg Brown

that a Well, our They are the much commentary I that in gave. is the in smaller reflected think I view think we business. player –

deployment. out, logistical much I just revenues, this and Malloy installed think more that pointed engagement of because very mentioned, have as year’s is and we annuity extensive contacts unique, QX I difficulty and base know but as you customer

food safety is I last delayed think several of It at the or demand, and longer. product public But do to what actually away they about again, that's demand to that's in saw the I will radio chain. over are likely think think think actually in it goes comparable land, be be and recover any deferred a top that on will ‘XX. the and and the and we I But demonstrated revenues business than will more years lost decline mobile, decline? I Yes, remains

standing but a we view have I their of certain they and think more that comprehensive long market, think would I maintain I and perspective. very So opinion, a have the that's thorough

Unidentified Analyst

very much. Great! Thank you

Gino Bonanotte

Greg PCR customers. note. of is additional important that to for the of the The the commercial It's earmarked degree on that's PCR safety the public earlier, seeing that’s business business composition the our and we're PCR, not note as we're to necessarily specifically percentage Just also more around marketplace. business commercially, around and that one item the seeing the specifically that's where pressure mentioned in

Unidentified Analyst

Thanks.

Operator

with ahead. Paul comes question Cowen. from go Silverstein Please next Our

Paul Silverstein

it. appreciate Can you I okay? hear me Thanks, all

Greg Brown

Yeah, yeah.

Paul Silverstein

Okay. business, PCR If it don't know I return the normally I you to out. break

hospitality, you exposure, got been particular those a a ones what you sectors? listed. devastated; heavy Can percentage sense particular particularly absolutely us those the from exposure revenue to sectors Given that I’d you've business with of that etcetera, have assume for comes energy, give

Greg Brown

in Yeah, Paul as all Gino billion. commercial think with about I and the and professional for last last referenced, land, commercial enterprise, radio radio again $X year, mobile, year

it think this obviously So as retail, that's vertical gas hospitality, we pressure, had the that significantly that's the most the served; and two-thirds oil under area come and of year, impacted. been most about airlines, is that

what's driving digit pronounced area. in decline double that the that's So more

Paul Silverstein

I somewhere of of nature that's would've [inaudible], two-thirds. the Given so exactly expected, what north well XX%, around it's

But Second and respect I it etcetera. Vietnam, seeing COVID impact particular, and in the question, Asia least first Asia the I in now hit Pac been it’s not Malaysia, to at comments about with uniform Thailand, shutdown. China been don’t your of terms see Pac; its timing recognize uniform we’re in of of the

sequencing is, things coming of not early. gain in there very anywhere, trust having question it's from and take gone and there terms your in my relates terms I and to is but that know timing can very, away any is events can of There's of the seeing just lot I So North you sequencing, turkey insight your of you cold worldwide it as back. visibility anything a American business? business and

Greg Brown

ahead Asia point Asia honest early to same country, tell are I'd in that kind measures been out, say our are within look of country in really have precautions pretty I that certain Paul there at when they're started slightly but you. Things of Australia. have set – and get with can't is it’s re-open here, up. where Things to your of from It's the states think biggest with you Pac lot to you a so Pac, sporadic. essentially Yeah, to just be

there. know of within our is up, you states have – but you engagement will opened talked business, things improve in really we know I we've the one security the at haven't and look we seen North that tell it, But you, even video that America analytics about our

– not a there's it's lot can So glean. we whole

East what at parts cautious the to starting very those to it's are up. a opening bit but Middle up look call as places buy, open You little would well, of I

Paul Silverstein

I you. appreciate that. Thank

Operator

question Cleveland go Ben with Research. ahead. comes from Please next Bollin Our

Ben Bollin

Good evening you everyone. Thank your think duration cycle sales about discussing customers. as reengage begin you you of wanted start you questions. little by for could taking how the to – bit a I

starting kind of You you to Just level awards? and think any where period new those a you close outage, of discussions had your customers high have thoughts the you're any there's up. to I ability their know traditional think have business, change and in follow on the those

Greg Brown

Okay business. – roots things Ben, an flow. same. and grass term so business, projects has you agreement way continued call extent of It's to dimensionalize the not of to by continue There's an to amount that what the there's I all not big then and are kind our

delayed. projects through Large for like get go example a is approvals, meetings then proposal and that of go been through have approvals referenced, state Gino to you city and and Greg use have typically approval, timeline, elements have those – and have really the but you lot that's request what to they where procurement a board what council a

half just things. to issue, you procedural will. go into had project had the the ended. we've the and out milestones have hasn't it the just an and kind second reshuffle milestones extend moved to kind right, to not have to that there's you the right, re-canvas a those reshuffle the issue of we That's of milestones we've have It's if them whereby So whereby been know resell, really to kind the of of moved

you delays of access but those only to been we've we’ve able thing kind all things delays. our answer with there, the it's The we’ve And is, really things, stay people the as know good get been relates as about physical technology those not do but type with to things those with those some to Center at news of well. milestone a questions those kind Command we've and engaged just where of seen and to and kind the work If video well. customers, sites, go there's things, in talked as as got it

Ben Bollin

grants, be in taxes, federal mean the four you at diversity position Outside the on don't transfer looking funding commented stepping property earlier seem forward. the of look also sources. and XXX pieces you I to very federal tax, Jack, that. the a for in back, just funding, those Thanks income good when

for looking thinking interested opportunity feedback you. thinking you're the from into or you're time customers? in coming just getting the customers developed How public from that I'm guidance, you're not that budget I'm sector of any So opportunity. bucket how Thank future; specific absolute over aggregate but about the

Jack Molloy

were Yes, are communications, maybe I'd work start the concerned. that so don't priority they selling deem we of good that I listen, fact to if flow that non-essential something if to the selling top be want – mission and non-critical, would bit – were But their very a is we I'd with that's a you little critical thing. at communications, selling you're think chain, the I

But it's interesting.

remember, bit little we are a If gets to after recovery sharper, you tax, If their technology look our you things certainly of at before, taxes, there's things through and been for feel significant property customers a that of those little felt impact they've and this Obviously critical years, mission is have like this know not but through our pretty of kind that XXX; related things the multiple been relates sales we’ve this. lot kind impact these lot a to a went it may there most upgrades, expansions had. of it, went as a of bit they things. a planned

look and in customer to back everybody We had was continued saw in perspective that point team You we harder the had as and time forward United that frankly to in to a know that budget through than move deal a from we think I I encouraging hit that some additional answer, things and at every move but States was central some pretty navigated delayed. probably the close XXXX I at pandemic. we this questions as

Ben Bollin

rest luck guys. the in Best Thanks of and QX the of year.

Operator

Coster Please Our JPMorgan. next ahead. question comes with from go Paul

Paul Coster

decline sequential for The it geographies? Yeah, looking a geographic uniform of thanks my you're sort from is perspective, that taking question. for across

Gino Bonanotte

think Yeah, I Paul is. so it

hasn't because Greg the do I when has there’s weighting the – just gone we the general do it's it, it it that of an think at look because that spread equal opportunities at on XXX had surface, is for essentially nature business. you look hit reason we XXX if have and of In broad you away. said If the those countries; business, it

with and and as we've deploying things. of delays it's engaging physically It's There those sites to to had been same that systems physically limits, has related of things. some equal the customers, going those kind opportunity, been essentially

around largely So say felt equally I'd globe. the general, it's in been

Paul Coster

seems of things they safety It a going systems budget future, contend shift go to is public me that's towards to are to be administration that for a data to the to public and dramatically while that's be going feel with the And the Just question a want doesn't from testing be like going health back just but your intensive. contention shifted going have moment. like are the sort dollars then now, where of seems it for courses around budgets. of and in you perspective, to and and biggest

could upon you just comment If that.

itself passing, also participate what initiative the opportunity like present big does you, the in as And I next in seems very years. to then Motorola can couple of mean a over well.

Greg Brown

couple Paul delights Security this of Analytics fact been companies, one the Video that there's that really a we most and to it's the frankly has in terms in the in the If substantially company. a question, of portfolio things a we've months us. but struggle – great certainly last that of lot and for it So, has added us

well mask tracing. social as facilities, in domain, are compliance in May manufacturing – teams and our market now campuses, as Analytics June working and distancing, will fever on around Solutions in be Right and in contact detection continuing be scanning will the Video public technology, around to

tell return you So to lot you will the analytics of that dialogue about getting essentially around and think a like. the if returned-to-schools campuses,

solutions might who come and monitor tell somebody who sick. was is contact someone Our school, through control with if that that access sick, door you able have likely in will who went be at to

different a much we'll of maybe as see, So as type change or opportunities. a a moderation of

Command in think at moved but move cloud, cloud services cloud Security Kelly great Analytic I a vigilant Center look team and the to put so on this this also Video done year. spot the the has to our have that. been Our business, you if cameras we’ve moving in the and far XX,XXX his job, think a space – I

I every an with So one is I Analytics Video has benefit this. that Business challenge opportunity think comes to an the opportunity and from think Security

Paul Coster

see responder about. you, not tension – not but seeing contention resources but for the first You I mean contention are healthcare I public scarce the even public opportunity expressed talked that though systems. don’t for see safety versus through the between the you LMR I there, safety as

Greg Brown

have, a a equipment important to If most they a or fireman's the for you on firemen, they officer that paramedic, job the police tell that they radio. of who the a have is this changing. they've is important and had always most a talk has that you or it’s piece We single XX two years, been communication a millennial way that and see the lifeline don't firemen

don't see us telling that changing. they are customers Our

Paul Coster

thanks. Got it,

Operator

ahead. from comes Walter LightShed. Piecyk question next Please Our with go

Walter Piecyk

end assumes assume the you're the recovery. of not that current June, that I just any guidance of state Thanks. affairs quarter's extends until expecting the next basically

their some about had consumer bookings, safety you kind some was process stronger public competitive talk ever. clients because to the some obviously return you – opening than had Airlines you’ve about were had while Verizon down, larger increased on up, companies that, about growth, Just thought of seeing or states of enterprise talking talked

these curious far now to the it in and just given what right already I guess for and QX of May. about I’m could of the be, point early you can some implies how realistically exist guidance data kind So think

Greg Brown

and itself. radio reflects as that Gino is segment by driven Yeah, well, professional I think it and largely commercial mentioned, the

that's So on verticals, accentuated corporate point pressure QX. most for radio the

the again, was forward a it it's prudent of going engagement do and largely a and and we're deployment, The really… way well, guide in and that, just of accordingly. lot to second it and March, let’s as But half is we May the April if second responsible move thought QX,

Walter Piecyk

are seen you're So I'm that with, other involved of the it’s because sure the PCR PCR that with, involved not type just I’ve move. that dramatic companies

airlines that’s and are when talk just that crowds, as about it’s addressing that are guys So things result. with just that, it's a because like customers you you your specific more it large products dealing to specific these is things, that

of these to figure And all then, hard I away out are those us come going guess for customers of could it's types if theoretically back when any just some businesses I to right. right. at of go mean

Greg Brown

I if Well, could. maybe Yeah.

set, again, you Kenwood, The physical a it, kind of think doubt I of and systems that they there’s towards airline, of well. of element things, from PCR about so same number you the it's if competitive about talked ICOM, and felt it without a the design they've traditional think equally Verizon. as about I private a of and – those Hotel a the people, And dedicated because refinery, like felt like think are if thing. those a system deployment Marriott So those an The you PCR, type industry has think I and it, a companies think Hytera,

different. Verizon's lot a

at a phone you and a go you could and pick delivered up it pick kiosk, could You can have up.

our if that in the same will of – physical So see business, we I Talk]. what… think really sort the would that's you I wouldn't [Cross you see delay know so

Walter Piecyk

was I referring I some it to it there's be these more of But Adtran, data like like – only Yeah, I might there’s airlines that mean mean, Axon, at again right. obviously a just Verizon. customers the and Ericsson, customers you than Ciena, more specific, crowds, mentioned CommScope, just of rely Verizon some large point. seems these,

they at people kind not? worried just customers the those return are return you state don't of of to how push right, to of going that large are never to to opposed maybe the all crowd because again, but as So

Greg Brown

if airline of I view we a an small mean won't to well airline at relatively the it. think goes customers, – that's business, a look subset of the radio you relatively need as would out it, portion But of be small a we it is, system. it's that that be I frankly. example know one

Walter Piecyk

doing – XX%. enough by your safety I – that this down doing well, guidance was revenue much Because down you and XX public Okay, it's driving that me, poorly that take the was to was it and thought was said the revenue down it just was in but it's that by excuse QX. growth not segment enough

Gino Bonanotte

to being XX think things the right and pushed trying QX percentage. small And but going I to but say its is an pretty what it's evaporates, Commercial we're acute representative that well, evaporation issue. not a It's negative there we issue, category. to it's the negative that might Yeah Radio XX, evaporating. right really timing to be of a some not It’s Professional in think that is

Walter Piecyk

those I sees So could if JetBlue indicated that fair? up, go then like the numbers see up, their is see Awesome! example and we see quarter and they Marriott, June should numbers be we go not September, their numbers for but back if – business come that next quarter, that

Greg Brown

and reopen, pressure airlines recover, improve. the can't Hyatt, that’s improve, that people to right, but I speak are it fly the and again, commerce economies because I states yes quarterly Marriott, people does of go you will don't to Hilton, that to and downward know the start the acute business timing start look, precise, Walt, alignment. and that to exact if as exactly right we’re

Walter Piecyk

that’s Got Greg, Thanks it. helpful.

Greg Brown

Yeah, Thank you. no problem Walt.

Operator

question go ahead. comes with Jim Please Suva from Citi. next Our

Jim Suva

cycles. you, you and lot both Thank of for a decade over a you known of know time been I've Greg we’ve and through

talked correctly You you puts takes. much of the and know about so

questions your that so the you have Solutions of the will piece pie. of top or since when just for budgets. the pie or already speak fair Thank to in of the six the been to more the local for you XX its its inflows Is fair experience that? on talk and to a mentioned been is structurally budget five has maybe you. ladder Motorola ladder question, local lot and compressed compressed than of top bigger on or My you state piece give due of currently of pie I’m answered state know months, even what balancing inflows more about less to six focused of like opportunities and

Greg Brown

compilation a and at they're one X/XX; us intertwined. this had Brothers would the countries health I before. is We've public Obviously once had and think had what any situation dot-com This I I think Great severe is an don't this. of is different both Lehman that act and that Well, we've crisis and have downturn XXX of Recession. of we've economic say it's a the seen it's collapse;

revenues I and Do a if we we incumbency? it take recurring the continue should Software the to of Command And in services? greater that face even believe strength a will software this. right So look grow, think about, this Do we brand in equity? and we Do at I percentage have have of Center step businesses? have in grow back are in year we

the even analytics, and to security we face grow expect this. in of Video

anchor even Software and our could services, grow of with would installed base have position networks and in and in worldwide, still tenant we digits mobile, strongest that around North the probably of our land, expect being XX,XXX strength mid-single face and America. we this, footprint incumbent radio the

that It We well. forget an services, $XX billion upstream, China. communications China, conveyor move video these a absolutely addressable critical integrate anchor good we’ll to in? We’ll integrate We’ll we’ll is Is the market, we security radio in integrated as be a by that. believe this way monetize mobile, tenant as business and land, information addressable of zero market. out networks and with

not career fundamental full change technologies answer that reflected I've Is also guided continue is are why it the invest We we are this do. the of to think market strength, our guide. our variables but we lot prudent in and a a just and doesn't the and and moving capitalize play, around, on, can brand things going we advantages and attributes, longevity position to organically. the which is that it thing never that's a guide. There's temporarily it yes, is my always QX dislocated? to Obviously We was first. the year, in for

acquisitions accretively having Solutions. us make that continue we're around opportunity Sales coverage, an is cloud, dislocation, that this for Motorola invest hearing year that and see software a year video and to assets think going security, deployment I radios sense different and to temporary to may – prioritize into this next and of to capital newer the inorganically, they're to later command you'll center fold

environment, invest really I no lean the our breakeven XXXX take and it's come do. there's the this a opportunity tough and out too, exactly out team that the OpEx So even position we're I an of believe in down is does end to doubt that's and of responsibly, other but what and and million beyond, think $XXX take and to to in stronger firm going

Jim Suva

their a are is, up just meet comment my interesting as from forward walk now And going other gave off little to in that floors companies it M&A, to you or person, is actually M&A bit still like and takes as and just you Great! me that simply longer. of go it quick you're It can't correct called factories. and very go Is because you can't your kind maybe you planned sounds very, planned. you follow forward

Greg Brown

any I engaged would but pan bit say another now there's Jim, feel this May, dialogue out, that Most them is or encumbered in is you delay reopening that see I going I a see. don't take as opportunities we’re conversations and in plans will will. a see of if and that little area of longer, of the way. now, this it's forward. It the come that may kind but don't regard middle our being opportunities has begun, we'll I right don't couple of we're with

Jim Suva

appreciated. greatly detail. It’s much Thank the you, so for

Greg Brown

you. Thank

Operator

Our Please from with comes next Suisse. question ahead. Sami go Credit Badri

Sami Badri

just we get the and rates question you’ll but in just XQ, how better to coming video, growth grew sense and you that or surveillance XXXX business, a and in the what video and really about very rate, question. tell Avigilon Thank some where because and growth for growth the mid-teens has to Hi! in Avigilon XXXX I for us on slight video XXXX. much XXXX want to thinking the growth we was a be mainly guided to growth rate is from for the you've My hoping model should with what

Jack Molloy

end team know America meet Gino, has issue we tell research talked So those Particularly for in QX, looking Sami, job. we of March greater I where QX. engagements, no North you obviously customer was at pointed and Avigilon. were about market. of taking the we've out, made in investments been the quarter in significant But would share. Greg, terms in you investments with had growing coming QX, that's the of even out limitations as of some there's been just more go-to-market, ability QX it the as to we Frankly had outstanding best and three times the done We've an development. We're in some

I of HX include the not WatchGuard, We’ve WatchGuard completely doing investments invested of spoke to we've we’re public we've we and cameras, and acquisition response in things in some analytic new and made, there. line of what safety working got and that's are interesting to even on a earlier. the software pandemic VaaS

not levels sometime to expect we So to assuming in we growth back normal, get we actually the third – the to return expect businesses, quarter, those rate if greater.

Sami Badri

you big a there that I out. got it, then called just had Command it. uptick was And on follow-up Got have and Center, guys a

You’ve the Command have and thing you is, addressed modules and it the are to year. one existing a you know when within the buying thing, pointing wanted Command comes really full big The customers growth I suite, do more for the Center Center? it to

like to is come to more execute I in just XXXX, the uptick and is see the buying that Is it understand the suite more in kind in for in Center going those existing motion XQ, customers the first what Center? want just the customers year new of what versus customers big Command you're Command that modules. place the needed or to and the of rest happened was just they then that within

Kelly Mark

in It's customers new Kelly. suite number is the Sami, which new the great, So we the more platform both. up to picked customers. Frankly opportunity those width and customers and of we a gives Actually its the depth customers, to them. the us of in of first and land what provide grow actually combination a than that quarter expand because

are seeing Command expanding and still though Suite. more also many of are Center the our modules we and of adding still moving are customers We

regards probably the profile you all buy the They folks walk in time, don’t Center risk still Center. schedule we're I’ve one said to XXX that year, the year, at of because CAD past, one as thing and will typically on recall, next do next a As simply and of that. those the will we progress and components across and a XXX year, they positions and doing seeing penetrating watch Command the how are we Record the good is

that's pretty the Center, So that’s if have on much look follow-up did QX. performance Command growth why the saw but I know the a in don’t we we you that, at we and how

Sami Badri

you. Thank Perfect!

Operator

This concludes session. question-and-answer the I conference like remarks. our would Yocum over any turn to for back closing Tim

Tim Yocum

for Thanks a comments. you and we’ll lot to additional joining soon. No today talk of

Operator

you is conference The today's concluded. now for presentation. attending Thank

You may now disconnect.

Motorola Solutions (MSI) 8 May 202020 Q1 Earnings call transcript