MSI - Earnings call transcript Q2 2022 | Motorola Solutions, Inc.

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Operator

Good afternoon, and thank you for holding. Welcome to the Motorola Solutions Second Quarter 2022 Earnings Conference Call. Today's call is being recorded. [Operator Instructions]. The presentation material and additional financial tables are posted on the Motorola Solutions Investor Relations website.

replay within call conclusion X call. webcast on be of a website our hours addition, of will this available this In after the website The www.motorolasolutions.com/investor. is address [Operator Instructions]. to I introduce now like would Mr. Relations. Vice Yocum, President Investor Tim of Mr. Yocum, you may your conference. begin

Tim Yocum

forward-looking the duty on to in Form conference to any filings statements. this could factors portion found our materially join and Mahesh quarter the and on differences Molloy, Greg. in We call risks We the statements current and will Good your Risk me release do on results, annual will call. the in and be commentary, and the based Executive any otherwise over in turn Jason and news and XX-K Jason our XX-Q Vice today variety forward-looking that and call. GAAP Actual be XXXX any for to President Mahesh statements CTO. we Vice And earnings or to and noted. will include Chairman not and with presentation With the Winkler, Factors Brown, at including those A for our quarterly President reconciliations call, earnings comments Executive that results assumptions afternoon. uncertainties. Q&A. financial could Saptharishi, report Greg reference. presentation reports and our our during results I'll during cause are President expectations along release are and other made and non-GAAP of Welcome unless news forward-looking non-GAAP these of materials made Jack CEO; and update outlook, about These to Greg during from subject call an Executive of of statements. These Form can this second Q&A Information number Vice section are XXXX undertake CFO; a review SEC. motorolasolutions.com/investor. COO; differ such during the Jack today's with and earnings report posted reference

Gregory Brown

Good going thoughts for Tim. the results Jason off and us I'm you, thanks few before overall a takes outlook. by our business us the joining through today. about and afternoon, start Thank to sharing

exceptional driving board above QX expectations. and radio earnings and Services, In record backlog. And in per SI, coming First, was to highlighted X% software growth, continued land both orders the revenue revenue increased both demand with across share growth by growth. led and our revenue and was up and XX%, Products in across strong Software video, mobile XX%

the XX% of record ended with inclusive unfavorable billion, currency of backlog quarter QX $XX.X year, impact. up of we $XXX Additionally, versus approximately last million

and meaningful go-to-market are growth continuing all X our investments Second, across technologies. to portfolio drive

revenue record operational in And was Software, over continued then our of share. per and through seamlessly raising reliability well. high while for services. QX this and the on location will technologies broadband thoughts. some finally, and orders offer unique such as Tier our results record I'll PXX up At and to remote as in for And programming, in command those XX% based final and turn we point, ending QX sales quarter, you NEXT the Jason, earnings and execution, year network full backlog strong leveraging both for of Center extension it return take who our both customers guidance embracing must-have During our we're to saw outlook ability device demand with LMR and its video LMR, features both growing APX is

Jason Winkler

during the we operating outlined $X.XX freight year by The added and product. and across higher costs In the in from on Thank sales higher to the earnings margins all costs higher ship together higher current related a saw was recognized expenses in current quarter, million, XX% secondary million operating sales. for $XXX $X.XX margins were earnings parts, $XX second the I decrease calls the headwinds and we higher margins with year by were to you, in FX quarter Software. acquisitions. higher earnings us growth material primarily grew per Command semiconductor versus to acquisitions. $XX were secure costs share in non-GAAP the prior both operating tax was acquisitions, strong benefit The Acquisitions X% and prior offset along with the led million, XX.X%. due previously, our record down up flat quarter guidance in technologies, ago revenue operating to direct to $X.XX, up by quarter. Non-GAAP $XX XX.X%. more quarter were quarter, GAAP in operating year the and was to from million, We in OpEx offset Video $XXX GAAP X%, both were and million was growth The higher Non-GAAP million, $XXX per which operating higher particularly critical to expenses in due enabled and operating more in Center material operating was EPS Greg. or were and the related primarily year. costs were mentioned up X the XX.X%, market, over year. compared in discrete supply direct generated Revenue our acquiring later the share able last to was to QX $XX earnings due X% with above related ago million. partially segments. decline critical LMR, quarter which

in operating of the and flow $XX in prior and generated cash chain us second, fulfill has that primarily was were higher demand seeing and payments supply investments a million our tied $XX to Turning million out year, flow planned incentive paid the X $XXX by was cash QX the to million the usage QX this cash our year, year. employee environment flow been position and impacted the first navigate $XXX with to LMR; In to of XXXX's free prior performance half Video record inventory million and dynamic the compared first, year. items: in cash flow. compared we're to in

of We levels expect current driven million million accelerate our conversion our addition a allocation half, $XXX to and the cash $XXX conversion. and in million for dividends inventory in the reduction seasonality second repurchases, our in higher by to Capital in QX $XX cash flow included cash profitability in CapEx. share normal of

the Calipsa quarter, $XX during acquisitions video we for and Videotec the for Additionally, million $XX million. closed of

were in $XXX freight down million net our of in prior long-term costs was XX.X% of balance portion and were higher from the Operating record debt, acquisitions by SI We fees of incremental the a segment primarily also offset were driven proceeds $XXX approximately to quarter mentioned, of higher sheet. sales of debt Products million on $XXX $XXX the retire currency QX used issued million, million Revenue headwinds Products for resulting X% see were segment, Sales XX.X%, versus orders year, across this both XX%, year sales. the orders or and by strong LMR million $XX the million. video. partially higher LMR for in last costs we SI In and video. the including continue from material quarter $XX and during and up both to earnings for previously and up demand and

impact be half. higher slightly year pricing to expect in than margins full the actions to this the for segment continue from as operating XXXX We accelerates second

Corrections. New Some County, the California several the York million PXX in Dutchess including include the $XX for and for notable a large achievements of wins million and $XX for QX in agency, orders $XX order of segment Department million U.S., Georgia state

strong customer a also and X million a health order large we an PXX $X $XX customer an revenue a a was fixed in with vertical $X of integration a with a international LTE In Argentina. Command deployment a million XX%, during segment, while And in solution quarter. $XX demand revenue million Services headwinds million acquisitions and software video video up and currency Center the was XX%, TETRA Total up revenue large care services, orders, received LMR million retail of driven in up driven $XX a was partially for in mix offset customer, basis million revenue for and by We had order by XXX or for by from in the expenses, Software X%. M&A Software, $XXX higher sales. down higher for of Operating were a order XX.X% large year-over-year and customer. earnings from year, order the finally, last the million in change in $XX points for segment sales,

from segment be to comparable continue year, the OpEx year operating inclusive the additional acquisitions. for margins to our full for Services expect recent to and of Software last spend We

and Australia LMR multiyear million Mississippi. this state of include $XX Some notable $XX the South state large QX in with segment million highlights service of the renewals, with X

the Command $XX Maryland. were city, the Detroit $XX camera Police U.S. the had order -- orders Frederick Department. in metropolitan million Los also from million the also Center from large million and Angeles We $XX an from County, awarded large X from body-worn We in $X U.S., Department a Softwares million Police

year, North QX million, revenue offset versus was X unfavorable on was with QX technologies. revenue up X Moving next $XXX International America last to our technologies, in by regional billion, XX% flat growth FX. results. all $X.X growth all in

by the in SI $XXX to ESN was the backlog. demand record Center million Airwave of and burn Sequentially, contracts, recorded robust driven was and and fourth and eighth to orders billion movement the quarter related up Airwave of driving LMR unfavorable of is order unfavorable driven Software. all extension 'XX million, continued which by in record backlog $XXX million a million, was inclusive Video QX up quarterly backlog Sequentially, XX% record The our which or the last the growth both and down technologies. last products, Command $XXX LMR In a to $XX.X billion, million $XXX backlog, up sequential in backlog quarter compared and Moving video compared offset -- segment, products partially Products in across increased QX was our segment. Ending approximately by growth FX. year. XX% FX the record revenue of $X.X $XX consecutive of X backlog demand or was was primarily to in year,

increase by our profitability backlog also $XXX second half. and the or driven America. product Additionally, down primarily In the year, recognition pricing, the ramp contribute million revenue Software. Command driven in FX backlog to expect Airwave compared backlog services a new Center contracts, North and which unfavorable in for reflects last ESN second extension billion and to Airwave partially to the in we was by $X.X Software increasingly orders Services, and Sequentially, record backlog for by $XXX was quarter multiyear and software X%, million offset

Turning next to our outlook.

expect share per headwinds includes be between XXX approximately to headwinds, FX of prior FX $XXX X%, updated with up share QX share. of $X.XX per per X%, of XX%, rate and approximately sales of count expect earnings be guidance. a between This of count average $XX.XX approximately growth for of share up from of share an approximately and shares from non-GAAP This prior million and XX%. guidance share approximately weighted and $XX up guide we share. full rate XX% We to tax to shares are diluted assumes We And and non-GAAP effective revenue our our the of tax approximately our to now of increasing $X.XX approximately XXX XX.X%. approximately and earnings both guidance effective million, an $X.XX per per a $X.XX expect million EPS million year, we revenue $XX.XX

Before priorities I we the of Greg, highlight are remainder back would some turn I of for to the year. the driving the like call to

possible. to redesigns strategic inventory semiconductors, First, investments our rapid including and making, we available execution, supply teams securing tactically remain chain discrete when and substitute by to semiconductors agreements entering long-term engineering where supply that brokers from alternatives, necessary are we focused into both strategically, on high-demand

been second Second, we to increased have effective call environment. date, pricing cash are opportunities continue we'll as to cash our at the capital through And with back a we balance our continue manage pricing actions we'll in and across sheet to balancing finally, the to cost look discipline and maintain portfolio cost the I'll to benefits over inventory now turn half. flow conversion, higher drive and optimize the Greg. of and working higher

Gregory Brown

with a we end I'd call. this thanks. to like as conclude thoughts few Jason,

brings and achieved and XX% in pleased analytics, of Center sales, We we single us ending our pricing prices, Software. We to PCR quarter. backlog. record cloud the expansion video we've First, well with native Videotec, offset for critical orders infrastructure which margin we portfolio Command record We us both input ever market. I'm video product the portfolio higher the QX accomplished of orders, record our the for which including really ended costs this the strengthened half with including what serve had position for largest at taken with actions our growth advanced The and acquisitions QX back Calipsa, camera year. ruggedized quarter higher broadens during to QX video quarter

such year, environment continue as this our the we X,XXX by students been, of body-worn been deploying for AI on access I solutions drive company. we're Houston the help multiyear our And very Customers customers County management South and cloud the momentum. Calipsa, cloud video customers software and the half encouraged Carolina funding provide finally, world. around as to am solution safe. accountability in second security have Second, safety the than and be schools to AVA accelerate to our of city And keep of cloud-based enter it's to with robust as The with Security well both deployment and ever solutions enterprise investments continues And never growth more video for cameras strong our is important. with and to our help like security public more software the depend in as positioned acquisitions Greenville for evidence control greater transparency.

flows the and allowed your has deployment turn sheet this Our to resilience flexibility now Tim of back durable our strong in over our opportunistic call our capital. dynamic execution And and to environment. the provide effectively I'll future cash of us to welcome questions. with business, the us balance strong And be our navigate finally,

Tim Yocum

Thank you, remind how Instructions]. the to Greg. ask our on line the would Operator, please you callers question. [Operator

Operator

Instructions]. [Operator

George question first comes from The Notter Jefferies. of

George Notter

comment local X. budgets strong July Obviously, funding were those budgets the of those reset What's I on made Many Congratulations on a budgets? forward. results guess I the and and government perspective state about about backlog. you environment. to now wanted your looking ask began many of on

funding be seeing ARPA those how curious right also a your I'm on related Just environment seeing what and that is on you're then to perspective the And ARPA. of if you're is question budgets? money wondering now.

think the great? funnel. I you improvement now? in detail Any quarter, provide What like seeing does that were us right be told you sales Xx look you more last a can would

John Molloy

Sure, George.

time. derive thereby, money personal So time when alone to have. have, for they what states, we if they're improve fund in think state nice a it time a relates I it, from again, very of But what all, to beneficial environment budgets, the the we're about self-funding at we sales you coffers situation. budgets do, us you local inflationary think, to from benefit provide I it all first and we drive mean, income tax, into a stand and income from which period Because and to hear is as more their dealing need and of corporate in, say their of tax, general look tax their not

that it's of So piece it.

are we've But ARPA. and tailwind. fact, and And the XXXX it's the is it, would made say it's simply not of we all know being those that just at multiyear. extended. rail these talked general phenomenon. that's And a that's available thing beneficial, generally It's also about this, is it's expire a I XXXX, important will until that one monies we be likely look think in the won't most and We second through likelihood

it. heard you've said Greg So

NEXT this be about. States devices, to APX the the with refresh but a situation we're investments. really we're script, year, also platform. I NEXT good we're the we're the through seeing in unique that later said it mid-tier really because announcing We're he we But is think And product think excited are because timely in I in going environment. which United APX a here in funding going

Operator

from The Morgan next question of comes Lapinski Stanley. Erik

Erik Lapinski

Can quarter. on on any it most? just Congrats we Is that kind of some LMR you're you cycle NEXT. being and just and you should with the seeing? that? APX on and What Or up the towards I Maybe legs of those some NEXT following give the about deals think uptake the of comment is guess, upgrades? how made on us on skewing just update the PXX just of APX

John Molloy

Yes.

as couple said and period updates, of cycle. metaphor. baseball performance PXX the the But we're it's just inning, we're So NEXT, time. I interest before, the but basics, of we're a of $XXX ergonomics believe the orders. in of Connect. it -- early APX million Interestingly, still I second the innings only I've from and seeing of I non-Motorola better lot customers, a used the upgrade of Smart our not February really largely audio the it's was in think in our the call And that

our what smart young accountability, the about like expand as text the We of looking so capability is think customers safety, messaging to aspect PXX then that. the saw the type have like and of officer capability coverage collaborative also things was APX ways, like people to also share outside to at of and modalities particularly think departments, and data their It's And the COVID, and about NEXT. we firefighter we're those. more health during officers using location video networks. the field, need mapping. paramount we different they they're And in more LTE and That

original year to again, second half at has engage million APX starting tier, with -- discussions all which the targeted I releases that portfolio, NEXT customer on. really $XXX in the the mid-tier note But subsequent been of which So in would we've with highest is excited. this the the we're

Gregory Brown

than broad since $XXX a also is add PXX Erik, in was for public introduced, just, well. that the which NEXT safety was as of I'd is devices, APX general, but more QX record million the orders product And APX NEXT

the sold introduction. team job it, to APX a was QX And broadly orders, more NEXT record did team well. beyond APX public quite in about continues but away. Molloy's a fire -- safety XX has happy which just also superb think I'm to for I So as NEXT, product

Erik Lapinski

another just could on If Center in Awesome. one sneak Command I Software.

You had this quarter. to a deals larger few there

Just more beyond you into on any cloud-based? of in offerings terms of were And have did some have of and PSAP capabilities? there, other you any the cloud-based upgrades progress uptake the presence of those expand then maybe maybe

Mahesh Saptharishi

Yes.

mentioned a Frederick LVMPD, X So overview. Jason quick deals, just County. maybe specific

in is of and records really CommandCentral key to that addition seeing PremierOne If a you and hybrid With for on-premises Jack and county element deal. that look Aware the location where LVMPD paramount at radios CAD. us. unit more to information. We're And incident cloud which It Responder access mobile Aware was a that, element those, CommandCentral SaaS information to also accurate in single that driven is glass records is added as location being deal, to more previously said really of by Aware are, piece, particular hybrid the paramount information. but hosted it, a both and of that plane from to gives from case. a Frederick, solution both was we information -- understand locations being was

with public Award routing world's that in we the our is our Georges that developed And One in Innovation had one location-based this that application, point along rate, key was second routing. Thomas we invest this and itself introduce Maryland, innovations. innovate Police Australia the the say safety the hybrid growth SaaS And quarter. Prince compliant quite there the to first the quarter. Apple. O'Reilly Command to firsts in -- is in in we continue iX hybrid executing strong Center actually being a continuing Western growth significant first We're won we Software We strategy. And County I'll to country we're location-based And our for the and is faster introduced thing invest than strategy. on last with rate X is, Carplay NENA is overall with which

So hybrid together, I our strategy. we are on think executing well

Operator

The comes Adam from Raymond next of Tindle question James.

Adam Tindle

between outcomes and I on review any investors? give in and on Greg, sense it just with differences us make could there's maybe I hasn't different updates just that might based to think about Airwave? In been and level calls, you you ESN asked. probabilities financial the wanted particular, them set if any hopefully ask could to happens implications? what But significant so

Gregory Brown

Yes.

and I think engaged in things remain Adam, progress, really.

We the role customer, office. Airwave contact the as them information with them maintained very home on and have We've are the educate this and provided last contact we case, both in with over and the U.K. months our several in ESN. with regularly in CMA close weeks close

decision in because time now point decision a I the in line seen, the And CMA just add and I expect they panel, there's updated know. has you've with provisional at As can don't really been more by much this not December. September a final

will has actively it the invest think of in and think back And in been play but both mission-critical I we service as I in out engagement continue as strong. the that half the year, well ESN. quite Airwave providing the meantime, to

Adam Tindle

increased. Got remain I your it. follow-up. healthy. What have understandably maybe price It a like just as a very implementing very, as about core know elasticity you've increases trends glance looked in been at costs And backlog say this products? does some

you the If given you're some about that trends, would talk backlog maybe the that and be price can helpful? recap increases seeing of elasticity

Jason Winkler

Sure.

of it So when to half Jack's to can opposed to the And as less Jack X%, half company, we even was think growth half we were price pricing. that do, be about which more that think the second with from I the the recent team will second is the not backlog more us opportunity growth. the most half the describe, for actions an on contributor about as implemented in first have to continue of that than contributions actions in come a -- sales the of will aged the orders

John Molloy

really it's management. is just has done think our the And a that the discount things actually is job No, -- one of raise to right. the piece nice one at of I price. other I you're thing think that And team

ushered X in retention well. well. seeing And in raised all but increases price sleeves, services so there And we've net increases as as our also an prices all X we're example, we've business technology in groups,

on proud the really team well. as pleased and that aspect with services we're So

Operator

Northcoast The Research. of Keith comes Housum from next question

Keith Housum

great Congratulations the on has chain. a I Much up the end and been million through spent supply I about will the on can the But to guess of just quarter. the $XXX clean semiconductors kind want enter follow be into up? issues about other Or guys you you of is that as XXXX there any year. a you slate sit popped like to now? talk have are are looking talked

Jason Winkler

was was Keith, you might second as which year-over-year target that's a little the the We increase for a remain It semiconductor know, in higher higher $XX half a supporting the for than million first $XXX than increased But largely expected higher little that. and mentioned, our on half. with finding supply. $XXX volume. million the guide, in our million you be

with should pleased the not premium, which note method. I that will, sometimes you into we're of that primary budget, find to semiconductors, if So come that's allocation our

and amazing to method that job are We'll primary doing rapid the And there. agreements. an inventory at doing, is supply Our finding continue they're part engineering is teams if the constrained. our look investments redesigns available long-term and they're alternatives that

So generally, item, largest-gated it LMR. our is remains in particularly -- semiconductor

Keith Housum

Appreciate Great. This follow-up. is it. a

longer? has record is of Is an getting are the is for terms comparison? now, need are getting terms that the into apples-to-apples older we we growth. while of apple-to-apples entering to a backlog, comparison backlog numbers there the an looking at backlog In and impressive you're go But Or through? contracts this in been

Jason Winkler

if which to a print the is at, the to we've know, you backlog, getting Keith, The over the what more and as that's be, we continue time. been increases products consistent duration turning associated sequential where largely in, of with anything, tends than if quicker you're software services. backlog,

continues accepting and increases backlog are in product's backlog it our -- value So And segments. we're pleased the with customers price with both even some continues increases that growth products.

Operator

question Loop of from Next Capital. Fahad Najam comes

Fahad Najam

that the earnings I positive on -- sounded Greg, in I X think most to was the like feel I've I've ever I call, the years us. confident you listening heard been that you and

and driving correct positive I can look what just my am terms it confidence drivers? of through your if top walk your is understanding? in And you your me So is, in

Gregory Brown

firm Fahad, it, The in as the question. it. good just that we were matter particularly been the as about and because environment the talked level, as extremely -- but this funding an the is overall. Demand about Yes, safety I Jack local the customers we thanks and about don't I'm at talking Jason position enterprise America, have high externally, and in of here, public it's for for multiyear fact for And North and is and have mean security. smiling state seen. I've is federal talking of

Backlog at We think Chinese the concerns, also see, were or of confidential at infrastructure the QX. critical which X%. Orders same about deploying legitimate or in levels. secure equipment around talked highly print I against backlog, are we in time, areas. is revenue record Product as XX%

way innovation a things of in to FX And to tip financial goes well. accretive market Motorola headwinds. to learning managing it. from and addressable mentioned thoughtful and inventory the devices. Jack and the that's demand. manage continues love I that refresh cloud We've capital Jason meet do X% building continued done. hat think, the and and our are we're pretty the environment. So and continue operational and product Mahesh We're I and grow year I teams comparison deployment where full to do while Organically, important the approximately better, acquisitions, to it's the X% productive made, redesign difficult semiconductor that the to chain move supply strategically chain, modestly We're that think constructive just to here of on backlog very and we've as product against at supply is largely apples-to-apples. emphasize performing and raising

ability look at quite think product, execution, for the it's look customers grow I when absorb for I demonstrate pass to do what us final R&D, look I and still when the factors speaks the and I demand, our criticality growth look still our that at when strong. look to when ability of a look at at enable multiple and And contribute increases note, the price to for when we at multiyear I as demand costs. and So and at backlog input when higher that to funding, ability robust our facilitate overall I innovation, on revenue I drive

bottom a we why feel beat top environment. and why both half. So the very the the QX, momentum full is very in about It's it I good good in back why year we're and raising

Fahad Najam

really insightful. That's

was does up model? you into that exceeding your that last it Clearly, gave translate So XX%. long-term when now. you're how time Because your model, X%,

you model? your thinking are what So about new

Gregory Brown

COVID. for X% delayed things because about believe talk -- we at about I point, XX% the are. digits, the a XXXX, long-term I year, X% our gave we obviously, going but and from model, we video. were No, still in here product talking grow believed COVID is increase but we although I not it, had LMR mid-single that. for and any segment We're will largely X% that to Fahad, this to year in

increase product. the So in primarily actually, that from segment a standpoint is

be maybe it technologies: into as the video to the Software, double and So half, security, guidance XX%. approximately slightly nudging backlog to the positions LMR, contribute still the and back as approximately continue digits; momentum digits, on Center we it's the I higher. believe head We in mid-single XX%; XXXX. X digits well think Command low us we maintaining We are will mid-single Services we Software still with agree we like --

execution you As accordingly and more beyond. more the on update of for XXXX we print get future thoughts and we'll year us, behind

Operator

question Credit from next Badri Sami comes The from Suisse.

Sami Badri

wanted PCR? same just on right? people presenting LMR idea Did you integration. prioritizing actually the are safety increase to Have you Or to I'm and been PCR XXXX? radios could public slightly to just and quarter. the level, And that at expecting Trying both essentially actually guys an is for to sure maybe clarify to over radio and systems top better had handsets, the an just I ship get that at you that, prioritize in know if products it within on digits you question managed we not just is, the clarify I maybe a mix. mid-single If you But didn't you on line. have then say growing congrats many look were First, clarification. now?

Gregory Brown

than product to digit, flow-through The to a at Product because first. segment. higher little segment color take bit continue is I'll Yes, maybe grow that is one Sami, and in mid-single that the the SI second

to quarter, in grow the We mid-single flow that would year, the it now for last PCR, given expect full at XX% in or performance strong through slightly back the it half. For digit. will we grow higher QX said even

Jason Winkler

And the Sami, in able have more prioritized continue we QX, able to double to balance, team grew answer digits. some were QX your question for make fulfill of PCR safety. on and we supply, was be breakthroughs public the at with around public we focused demand In prioritization QX, on and safety. to to

were in QX, able given the PCR. supply and we So fulfill to environment, safety both public

Sami Badri

kind Got on it. of regarding body-worn bit other the some could little hoping an momentum? you update and on And cam share and then camera on plate from dash a you have we hear of that Can that What's I Jack features market from really released. was license side? give reading guys going us

John Molloy

Sami. Sure,

XX%. up QX, to our relates it were orders as So

a quarter, that when think previous had the was order. fact X-X you We strong we I XX% textualize over year. that relatively the XX%, percent, can up previous the think that over

wants Jason reference alternative. the point to Detroit win. been a saying market PD that's You And that an the think heard I is what we've test

orders. knew the I market with the well. think choose and now. performing we late our share a end given this seeing year, of customers kind We our XX% is and we're we we're And that in piece acceleration said we're orders as took for to the performance an year, said alternative at we simply it We came our offer, of growth I mid-teens think and XXXX, starting to comps, We've I the very fast. think XX% see, didn't of in we the I'd of last before as grow wanting first knew other cloud. out marketplace XXXX. a doubled said, growth over relatively we the right say in in half viable we're service

Sami Badri

one Jason. one have quick I for

Sorry, go ahead.

Mahesh Saptharishi

well, also you continue that integration and technology NEXT radios APX we invest in body-warn our Just side and about, devices. APX our between to specifically closer a asked on the as with investments cameras

there example, it recording And are for button features well. an APX an press more come there well. as NEXT on option an to So you turns radio, APX as if as emergency the on or

Aware going the from capability location video quarter, also integrates we in-car our from And real-time APX APX VXXXs live our information released This also to streaming Aware. NEXT and and solution radios.

body-worn information a both reduction is AI-driven gives location capability key to again, accurate information, introduced also our evidence, together necessity I key CommandCentral our cameras our from new also capability coming which location we in. for radios solution. our very And lastly, So The to shipping in able have and being QX this a customers. And quarter February advanced MXXX customers year. think we're of asking put for. proud shipping first what MXXX been of were our we started was that for

reminder, seen being just MXXX as we're platform, introducing key going capabilities, that great being potential ALPR have second. in into AI MXXX to there's we and great And one the AI This is is, growth have the released there. be of a MXXX. analytics we them, X capabilities passenger well. with a as true more We firmware platform the the and upgrade We think backseat

Sami Badri

Jason, point one guidance dollar? that to everything FX on that equal U.S. year. on FX for international headwind forward relative -- guidance one the your from FX improve your Is does Or including rates? assume this quick currencies the

Jason Winkler

year. spot Current going last forward rates relative to

approximately the million were about But is it So this certainly FX it's $XXX related volatile. headwinds today, It's on to of the together. top at we was million degradation year with the consistent line year. where last quarter of $XXX been

Operator

Cowen. Silverstein Next of question comes from Paul

Paul Silverstein

of the What at the before billion can the recovery where was in $X level it pandemic you're -- the business? that you of hit. PCR clarification. out remind at think us quarter? can you One But remind us of peaked in I And

Jason Winkler

was PCR Paul, revenue QX, For growth XX%.

Gregory Brown

base it's million. And Paul, $XXX-and-something year, last was

told And short earlier, the you it on made. of reference -- just higher as so we it's still you XXXX point will XX%, year, which slightly this maybe put

Paul Silverstein

All right.

I'm sorry, So question go -- ahead. the real is

John Molloy

is PCR well. for record going as a other orders quarter just was point QX one was that I to Paul, add

Gregory Brown

Exactly.

Paul Silverstein

able saw macro, the public been next seem from shut the connection And -- that to in notwithstanding cash you given the And the pay greatest Okay. of XX And does respect from obviously, going greatest it out that be different where to of XX to months? where Where Where variables effectively market? I improvement not the sounds like so does here? in was forward being that, over and sector? has litigation. finally, is here the are business opportunity in positive, penetration the that the go with they is for all video

Gregory Brown

surprised us the full kind into a the no rules morning flow what nothing particularly but the the on start you assume contempt and XX. further pattern motion say this can't give July we'll action. guidance cash And from court. Hytera. that surprised. cash that XXXX we cash missed We million they of way, $XXX a distract and and of owe -- all They about not remedies judge and of they are that year to the I'm Well, court color order Hytera. they deadline see filed By had with I denied, I'm in apply, let's deadline, by in. of escrow pay the They've and deflect, remedies

John Molloy

control simply growing question and XX% say in just you think had video XXXX. year business as and video, well I our that, is this access Paul, I would approximately on a

market; the important -- devices of invest the camera. verticals. or think us and about control But our big portfolio when to camera question it's care its a game in game Openpath, the well. But on by proliferate access fundamentally the is for our to I and mobile as And things, education, AI cloud has and that Ava changed our you top also in and about become verticals, acquisitions: The and both also X health of edge extensively, government, in ability about commercial. a Calipsa software Calipsa continue increasingly Pelco who we line We changer. into our our really think the bring think side you asked way analytics when

when If synergies was top their to remember, our of February and around you bring. XXXX, acquired benefit ones. has one think And it's that's our of sales that the the the the business government scale we able Avigilon globe now And nascent. been revenue we of in force

Paul Silverstein

the it's assume still was, question I in sector real preciously in government, early The of public video Okay. penetration. terms

John Molloy

Yes.

about, talked baseline all, we as approximately of think government, fixed But $XXX this our year. it's that a expectation I and to million of first X/X mobile eventualize business, that video. is Think early So it's X/X days. just video,

Operator

from comes William question of Louie DiPalma Next Blair.

Michael DiPalma

incidents the vertical. several stronger even school for this education from solutions you upcoming security getting for following calls, intelligence Is Greg, this you guidance education demand are nationwide? on artificial previous referenced how robust seeing from customers year strong exceptionally your different demand with

Gregory Brown

And I if complement access alerts. what Yes, to fixed automation for perimeter been detection, want and for been very broad or Louie, and key a And I continues stronger. for as on referenced of maybe don't even strong getting demand Jack is portfolio continues security, that well. that control, video Mahesh Education and has you anomaly has government control. the be think the with to video vertical, It know need detection, to perhaps along because that be access

John Molloy

it. Greg, I you hit think

technologies. have in think I and they've at are happened investment schools the and And that that We weapons driver well. detection. The a just significant to experience make for I to summer. and a Uvalde the temper weapons earlier converged for way horrific the approach And one stadiums sure know control, made that's big other the would video things test they evolve we to say is access as as but a also campus driving got concealed they

Jason Winkler

in LMR, and is about of the The were verticals. by X/X, other increased other is our which other both point then are largely QX many driven our the education the for expectations our results year which of I'd that video and increase for serving X/X and make guide

Michael DiPalma

call that on-premise cloud. taking recent your your success? and Were seeing XXX for your and in of the you're orders your you CAD solution cloud? Command prior in company that for these orders And hybrid past a any with Software in seeing Jack, think And X are mentioned the deployments Center the next-gen largest you traction for won are these X appears your it Or I quarters, that answer and XXX history. you more traditional solution modules

Mahesh Saptharishi

and factors This our smart solution; important. are our a cloud-hosted for Input, cloud-hosted for space. PSAP hybrid Citizen citizens solution call transcription, solutions AI to I'd there. being that with have well some for stronger that and is and is very significant reliability handling, which video investment said, also over-the-top on-premises we're On still of CAD, That the input say allowing Mahesh. call input capabilities as which into demand in in CAD. traction there's a become that Availability key text is way heavy combined seeing XXX involved handling

frequently on are the sales. Aware with attached other CAD We seeing thing -- emphasis mobile. And is Aware our CommandCentral

mentioned for Responder, really in Responder. The and to field LAPD, as and CommandCentral more access capabilities, CAD with need record more the along is important. becoming And both many well. smartphone information CommandCentral solutions I complements our on-premise For its

features we driving adoption see XXX with and delivered that key really are available So in along the our that the for want. the that cloud, CAD solutions customers hybrid best high

Operator

JPMorgan. of Chung Paul from comes question next The

Paul Chung

as OpEx. and particularly of think margin it, of in the year? expectations still may missed kind 'XX, have also of of we kind And that but kind pressure those half? early benefits You first some how about same question of kind $XXX the for have you as I second the do as margins expect for the well then in increases factors margin So see ramp you think somewhat how 'XX. how And rebound your on million of from your of do in how Just the then on year. guide, much up in? Do just kind the price flat the gross we about half? be of kind temporary gross to and on year thoughts this still

Jason Winkler

that. half. of about the just P&L we higher for volumes planned incremental guided for had margin slightly that, semiconductor increase, for this half, trend we And gross planned which you're is biggest had year-over-year was million probably first than the It little of than costs year-over-year. higher semiconductors given higher in driver to. million the higher the with $XXX the that We actually of in year will start year-over-year be I'll through cost seeing the second Well, $XX our a it

a sources. again, related available us those to that from primary semiconductors are paying items, premium So aren't for

semiconductor we're there's as opportunity normalizes, get market we on. to directly manufacturers, working future So more supply that the from something is the the into more and as continue on which stabilizes,

gross of yes. year, for the trend, margin terms In

side be you're OE will million half is which better, for up of get and of $XX OpEx, right, $XXX to similar year-over-year, related we'll second we're slightly which certainly from OpEx that and The of the the for increase million year, to will approximately cover the expecting M&A. the

So that's how to perspective. a it think from about P&L

Paul Chung

And on Great. just a video. follow-up then Okay.

in seeing and the Software for relative You're strength Services quite some some time.

of as excited we and think about? out? So talk you're trends how that look we demand about about solutions And relative kind most pace do specific the further

John Molloy

video Yes. We're of year. for the dimensionalized some Paul, for verticals. the well, the video as XX% I expect think segment we fixed some so we've really approximately for having We've full XX% and talked success. about

think I story mobile cloud, analytics. it's about a

within it The company space quick-service as business That as specific vertical of called acquired are gives we which doing. talk exciting. that us our like that We other cloud the into of us that Envision. recurring investments starting a things some as probably a we're didn't And a revenue security segment build path we're to on video is a retail. where put well well, piece

Operator

Citigroup. comes question of next from Suva Jim The

James Suva

multiple a parts the you for pricing? these chip was point away, still the Motorola ever, components? or services, majority so you solutions, -- say be how have are of biggest as your much that? to which you of a price when now part question. Then the increased is impacted kind assume and future mentioned was broker we very when of your escalation Or about I finance Financial LMR including at are for at strategy, strategy things you and decommits and my gross Greg, Congratulations not Officer big don't question. Chief securing have connected? contracts, And into Solutions, centers had team. where companies great. Are cross-sell product is get right early Did command like much margins you new we That you you go wins market you're think contract your

Gregory Brown

I firm billion. the think and guidance in our the mean just now innings first made, in Jim, back under informs for on about acquisitions play the it's Well, and a you step this year the overall. think we early year given $XX approximately and we've take industries this X%. And the we're market part, I addressable full

So lot run of here. there's a room to

make to the either growing which believe leader are to breadth in we is given the opportunity yet, America. us unmatched. are fixed standpoint I ground share at portfolio, industry and of think the North we there's and XX%, take globally width from And for control up every continue access video an and I While or not

things to that layer on artificial base On the ability are mobile fixed larger. Mahesh video, play and recognition in and technical gets plate license intelligence. doing installed video and an Our team all LMR, the the analytics,

fill infrastructure, portfolio, location of reprogramming which of in criticality You safety, we is footprint and LTE Software, not and in that critical extension the software think then services. cloud-based, any about of LMR enterprise more a think there's network And services, the and Mahesh roughly Center more and and all opportunity the having security key I around XX,XXX Command vendors front backdrop us. lot in public infrastructure, doing different hybrid China is overall premises-based, sell integrate by networks, of of refresh which into LMR for the over-the-air devices, device monetize upsell, things

John Molloy

It's ask mobile and important. attacked around Greg, question around Software is The that Jim, I very Command think, heard only I'd We've video fixed specific I on of sales Center as add, way a incentives I thing by think cross-sell. well. you

focus leader, where fairly land us around sales think, inserted well a of sales account have that up we our us Jim, we come by and I tool not has the America of gives and doing technology escalators. where a time. where lay And -- served with we've here North kind we're tool, a that, all, specific well. is, we're Our the should first of And X-dimensional

Jason Winkler

long-term us different then answer therefore, orders finally, of constant a necessary, parts. way brokers all have from the directly flow And so Jim, we're when and your the through supply manufacturer And semiconductor securing on through question to agreements. ways, components, purchase doing and in many

constraint, them are it's including continually think Motorola XX% give to we a procure. organization engineering our our engineers. then and I we supply that alternative, alternatives. important note can And in the abilities, know and And out be part chain if find helping that they over of are challenges, to company go

and teams the it's and proud the working collaborating So are way battle, we're constant the through a of environment.

Operator

Mr. now floor concludes will for the This question-and-answer comments our over to closing Brown, Greg turn and I remarks. Chief any session. Chairman Officer, Executive additional or

Gregory Brown

on Motorolans Most proud of thank be couldn't Yes. proud Thank listening. and we you. you, more the I'm that for all this of purpose of call company, the everybody. proud you Exceptional proud you serve. especially, of performance, the and

navigating the this supply on important. I criticality and execution environment. involved I want safety something the that results and amplify think to what of chain. enterprise and these add we're frankly, environment, chain QX reinforce in on -- security and the public passing to dynamic hat it's strong full the look, is this supply I just quite think of been and and everybody to fact do I tip very in part Jason my overperformance for said year think in never more execution

broker like specifically engineers QX. parts done, I be do there's the slightly I done But think remains to that position acquisition the semiconductor and product environment more surgical a purchases in referenced modestly for work it's and like chain, all the supply market in Having our that, half. redesign, but of inventory, environment momentum our and said I challenging. on appropriate largely better second by for Jason open the others

appreciate have you in everybody. I to you to to I forward We and joining few continue you a months. listening, Thanks, talking look and execute. to

Operator

does is call for you gentlemen, time. thank Internet teleconference. this participation and We ask you address that your be A Ladies two this hours. conclude your and lines please replay today's at will of the over this disconnect The within available website www.motorolasolutions.com/investor.

Motorola Solutions (MSI) 5 Aug 222022 Q2 Earnings call transcript