MSI - Earnings call 4 2023 | Motorola Solutions, Inc.

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Operator

Good afternoon, and thank you for holding. Welcome to the Motorola Solutions Fourth Quarter 2023 Earnings Conference Call. Today's call is being recorded.

If you have any objections, please disconnect at this time.

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 the available this In after the website The www.motorolasolutions.com/investor. is address [Operator Instructions].

President to begin may conference. Tim I Yocum, your introduce now Relations. Mr. like Yocum, would Vice of Investor you Mr.

Tim Yocum

CTO. today Winkler, Executive Welcome afternoon. Executive and and Jack Molloy, me Vice President XXXX Brown, and along motorolasolutions.com/investor. President presentation Vice and Chairman and Jack Jason Mahesh Mahesh earnings results Executive Saptharishi, release call. Fourth for earnings President Good Greg our quarter review and Vice COO; Greg posted our With to with are and at CEO; will and news Jason CFO; an and commentary, Q&A. will join We've

reconciliations the portion variety statements and call, during reference. made including of presentation a will statements. non-GAAP could for call. uncertainties. during and noted. financial unless on risks to current results, statements These your we differ These in non-GAAP based number materials and are the our these outlook, A Actual Q&A that be this subject those otherwise GAAP forward-looking from And expectations reference forward-looking include results of during assumptions are to materially of the

over reports not that, in and with any other of undertake turn statements. about update section today's our Information XX-Q be and the XXXX this during to could We will report and differences the made Factors with duty forward-looking found Form on such I Greg. annual earnings Form can that factors our cause report quarterly it in any the filings comments any SEC. release do in or XX-K news conference Risk on to And call

Gregory Brown

and us good and Tim, today. thanks joining afternoon, Thanks, for

robust double-digit places. property record in and an was We highlighting First, for including Security Solutions protect Security and segments QX people, our and quarter. help all that the and Video and X strength technologies, demand Center Safety revenue in Command growth achieved both exceptional

expanded $X.X Video we creator quarter cash operating generated over recent strengthened Additionally, sixth portfolio Smart the of our acquisition IPVideo, the Sensor. Security the operating consecutive of and billion with margins HALO for flow of

full in by In and and year results LMR grew and Video Products driven growth we backlog. strong revenue we were with year Second, X%, both ended our Security, our product SI record outstanding. the segment,

We also expanded higher in by by product driven ASPs costs. part segment operating and lower margins basis XXX the in points,

highlighted and the finally, also with In of in and reduction, and revenue was XXXX, up over backlog the inclusive generated to And Jason. Airwave we Software as growth. up Video we Command strong XX%, our the XX% revenue for U.K. operating for by position And continued of safety another and to record well cash growth prior the of that, versus outside coupled year Services, business the strong robust Security, billion, of security Center our flow strong going I'm solutions year. demand revenue Services us positions enter with And turn our earnings call $X

Jason Winkler

XX non-GAAP segments, material both quarter up lower non-GAAP higher were Thank increase operating in during $XXX and X% quarter GAAP X million, direct and growth GAAP from our tailwinds both while $XX regions XX.X%, added above from the XX.X% with grew in Greg. quarter. earnings ago was up up $XXX you, million the guidance XX.X% the year the was earnings and earnings was basis X% in operating year margin all $XX of for sales acquisitions The costs. million, points. Non-GAAP and driven FX operating technologies. ago were operating sales quarter by or million. both and Revenue were

sales incentives in the versus to primarily acquisitions margins. from EPS $X.XX $X.XX, by year. higher QX year. was was up up $X.XX, year, and The year was growth higher share per X% million last due $XX ago current OpEx from $XXX up and was million, -- Non-GAAP earnings the $X.XX GAAP in quarter last higher in in quarter. driven EPS current

was in X billion, technologies. $XX both up with XXXX, For across the all growth and strong XX%, segments full year revenue

and XX.X% asset Revenue of from primarily in by from GAAP prior rates and year, the higher costs, impact and unfavorable higher increase were costs, year. higher $XXX earnings sales acquisitions amortization year expense ESN million. operating $X.X of improved sales was or the currency operating inclusive in $XX in the XX% prior ASPs lower driven of sales, material direct prior earnings lower impairment $XX The operating was charge driven sales, sales, $XXX current million lower operating were million leverage. Non-GAAP non-GAAP of foreign fixed intangible up were by direct XX.X% billion was and XX% year. up the million the of margins billion, the $X.X in material versus

by per on GAAP earnings related Non-GAAP impairment charge a offset up prior exit of by earnings, to to offset share in prior current per the share higher in the and primarily rate tax XX% year, driven higher the partially XX% partially higher by higher a year, earnings $X.XX, from $XX.XX, earnings tax was $XX.XX ESN the was up $X.XX compared asset rate. effective the effective year. in in XXXX

driven to $XXX rate associated Rave. employee benefits by stock-based And compared and higher investments billion, the OpEx year. year year, versus XX.X% effective up the due XXXX employee with XXXX, XX.X% lower compensation expenses for was higher in Video in current incentives from prior was and full the to primarily the For in million $X.X tax

driven cash taxes. by for driven generated record partially year, was we increase higher taxes. full flow billion and Turning earnings, record higher the And to of operating partially our by $X cash cash offset flow cash $X.X free billion. earnings, operating $X.X cash flow flow. The offset by higher by higher QX of billion, was cash

allocation and repurchases, million $XXX $XXX million share million cash included XXXX $XXX CapEx. for Capital in of in dividends

our and billion share to $X of dividend, double-digit is program year approved of increases. which Directors consecutive a the the XXth in Additionally, quarter, increase repurchase the during increase XX% our Board an

driven next costs. Products growth of by the In in SI XX.X% up and segment Video. Moving driven LMR earnings last sales, XX.X% from to and prior and were sales $XXX lower direct versus in by QX or material results. sales were year year, up the million segment, higher Operating X%

Some customer. million $XX notable a Emergency Public video devices $XX Authority QX a this Telecommunications a order and TETRA order order for achievements from system fixed in for system for for wins PXX customer segment order $XX system PXX APX U.S. order include Arizona A devices the device Australia, of a NEXT million Services and international in $XX European PXX million customer. $XX million a an and $XX a order Safety, a million of million U.S. PXX Department customer. A State for

operating the million XX.X% from $XX billion and year, of SI acquisitions and costs. full And in inclusive direct from $XX Video. revenue Products prior $X.X million. driven up was Full was or X% LMR billion, the the $X.X of prior were higher Revenue headwinds higher for earnings year and sales, and higher sales by sales, ASPs year, up year currency were from on XX.X% of lower material

Revenue down earnings Airwave QX growth from in control. and to driven were In last revenue revenue by $XX was LMR. Command by million. were driven in X%, and from FX price quarter, year, XX.X% Center Video, Software segment the the million up tailwinds the and in were $XXX acquisitions QX Services, was operating related $XX reduction XX.X%, the primarily margins million operating and

of $XX network. Some segment nationwide A Safety for LMR a Center Public Regional XXXX notable and public QX and the City for A Francisco. $XX services communications order Office million Denmark's LMR customer, Command agreement in highlights managed safety order Emergency order million the $XX million Spokane, $XXX City the Center finally, million for million a video include for service renewal of Chicago's Administration. Washington, mobile a and U.S. through of a County from Command San Communications $XX

year, $X.X For Command billion, $XX currency were up $XX on was million XX% million. LMR growth Center and Revenue acquisitions headwinds in services, revenue Video. the was from and full

versus earnings by prior XXX of full higher For the acquisition-related the or were expenses. and revenue driven billion year Airwave the year, sales, down basis reduction $X.X XX.X% points operating

Looking full revenue And and billion up LMR. QX and was Video revenue was million, versus was for last in And growth in all $XXX next driven up growth last across year, by full North X% growth by driven results. year, X% $X by billion at the and the in Video. X% in $X.X revenue international international, technologies. up billion, X year, XX% up our LMR and America segments driven regional for year, versus $X both in QX,

ESN. and and for and million, FX. backlog Airwave reduction and Ending $XX.X backlog. backlog versus inclusive approximately revenue ESN related $X to million year, reduction of million the the Moving $XX last Airwave billion, control down down was price favorable was of for $XXX of billion recognition of Airwave backlog inclusive to $XX QX Sequentially,

segment, SI $XXX In America. up and by from in Software million last Services was Products demand driven the primarily ending was X%, million, by or in and up decreased and backlog America. strong North North In $XX Sequentially, backlog demand driven $XXX year $XX million backlog also million sequentially.

million strong ESN, year, up regions. almost driven multiyear and versus Excluding Airwave was last Software in Services by $XXX backlog agreements and both

outlook. now our Turning to

full million the expect diluted non-GAAP $X.XX approximately between QX an of $XX.XX rate up share X%, This $XX.XX assumes with we per sales and shares and share. tax per be share approximately to share. expect per revenue of year, of and average $X.XX XX%. per weighted X% And non-GAAP approximately for and effective We XXX approximately earnings share a between earnings growth count

share This tax an full average XX% XXX diluted million rate between a assumes approximately and XX%. and year count of outlook weighted shares effective

another before billion cash strong Greg, additional in $X.X I operating to share cash some with flow operating of flow. it turn wanted XXXX Additionally, expect And we of highlights. to expectations I back year

Video expectations XX% & want give the on cloud of for sales strong in included I that the guidance adoption and color First, some Control, we're growth growth, for by year. In which our acceleration planning offerings. are technology to Access Security the informed the is you

XX% consistent LMR, we high organic the impact digits expect And For of mid-single or home also office. to we Center, expect rate. for Command digits last the year's growth when single with in grow normalized growth U.K.

Second, I about business. you some our to would updates Video with like exciting share

], for [ we've partnerships X another recent growth support supply sites With further with manufacturing entered provides expectations, chain, strategic where video into [ manufacturing Jabil ] Google. of assume scalability. that optimizes operations Jabil our and savings cost future Texas. ] This [ and Jabil responsibility redundancy, a in agreement and our X at agreement with light our our will Canada In

we solutions mapping such enables announced our compliance increasingly year agreement regulatory enable ago. yesterday, combines secure as customer other preferred that access procurement analytics of with Additionally, little on our NDAA accurate Google and capabilities. and a control video Cloud a focus that it to power cloud and our for more cloud-delivered allows bringing intelligence, continuing education. Alta, and of harnesses by a introduced their and Avigilon fast-growing fixed verticals security AI Cloud engineering, with designing to And the we reliable to than enable video rules simplicity of advancements also cloud content, while which to of the native VMS AI the strategic us serve is Google new a power like platform, Alta with market some equipment. the video assistive ease with needs Google, latest that

a rate higher year subscription ample X/X in a with providing profile cash, XXXX, a strong a $X.X in finally, sale. ratio debt deploy The net I'll of debt-to-EBITDA since and capital including our And flexibility we drive the Avigilon balance the contributed is very maturity attachment X.X adoption call traditional shareholder to with lowest last video ended Greg. to our of balance value. sheet, now to year turn growth continue rapid to Alta to us includes almost compared back total billion our and fixed and Unity

Gregory Brown

Jason. Thanks,

of technologies, earnings for $X expanded We billion. grew per and was XXXX segments by a cash record operating operating sales phenomenal company. generated share First, record and achieved significantly year X the flow XX% margins, all in both

billion strengthened Video portfolio our our IPVideo. repurchases, dividends to the we with also share of and returned shareholders We $X.X and through recent Security acquisition

for reflects our businesses. past this This November, centered focus on Safer. transformation safer solving we and our safer safer Second, new and communities, on public our narrative sharpened schools safety announced brand security purposeful and enterprise Solving for

future, role. safety Video agencies LMR, that are enable connecting it And Center across those those & safer is who recognize public collaboration intelligence, to solutions Command vital can while artificial by enterprises, a play help. Our we with need not between powered the Security way a does and only technology in

And video noticeable run be we driving made opportunity XXXX, the and also our strong capital APX our by accretive Services. growth to acceleration we're of and margin priority, security and our our the investments strong for to Funding ASPs extremely as We're adoption growth revenues including I'm to in the value. that device continue revenue applications device NEXT finally, our and this in for in company. XXXX of and exceptionally driving earnings to another we enter safety a year how deploy long-term have on the Services. with sheet, And remains that business seeing cloud portfolio, we've positioned, products strong. is Software be to public shareholder pleased expect I and drive balance way, for of Software momentum software higher the strong are and a continues

back I'll now call the to Tim. turn over

Tim Yocum

Thanks, Greg.

I'd taking Operator, to the to many participants a remind begin like to line as question callers themselves how and on to remind our follow-up limit as possible. we questions, one ask one accommodate Before callers to please question.

Operator

[Operator The question George Notter Jefferies. is Instructions] with first from

George Notter

freight question the business thinking the what you model about down come and ask kind expansion fees in of like XXXX. about even of have until I'm have a wanted some through backlog. guys I burn guess on guys things out of had I you in I expedite the didn't lot the still that to running margin business. fees I costs. headwinds know those a

Silver headwind that guys unwind kind And how the be curious And about, you XXXX benefit XXXX wondering I'm might position? there So you all of margins I as year, I'm of fully much on guess will the numbers? out assume the there? on in what fund follow-up, do? Lake. And I a those then the might second wondering what just then just kind just is get for just update there a any question kind of I'm of was of how that on might

Gregory Brown

comparable we George, expect supply to of expect exceeding you, I firm, margin ops slightly and what we XXXX. to informed PPV. have 'XX. compliment up. as part million year. them to team expecting we out great targets did reconfirm, so year remind continued in last in set a just a by for in expansion improvement And standpoint, gross From in we are PPV team the and margin another operating do to improvement Jack's this $XX the be to for That's job Jason

the we leverage envelope both I million million the is 'XX $XX of million $XX up a going good So over think pretty be margin inorganic. about do probably on gross year-over-year operating job is organic, on operating business, OpEx the which margin. By side 'XX $XX half of is and and way, to this

count expires final that it they share already is second Lake, EPS As no expectations. diluted Silver into relates update the their to in pipe. calculated are year X-year It really September. of our The in

be good, as that way, plays for we'll of remains point. partnership do nothing the about the we on The see and Lake interest year is expires we this do which $X.X which this and refinancing, higher Silver note expect in $X assumption $XX about billion of expense includes that million is year. $XXX the of Lake September to year. Silver balance we of forward the expiration the pipe, this By the the expect, at million debt So really think report how of billion to

Operator

Barclays. question the comes next Long from line Tim of with The

Timothy Long

lower ask Greg, little wanted the on pretty guide a a the top but to line. year Just is the strong, Maybe, full growth. looks on you QX for little bit bit

XX% And you put with can, else getting it need or we the of ARPA mean, talk drivers, bigger if getting follow-up you the discrepancy with year? did other getting Is and that year share half of some funding, numbers to are and you in aware to, put be rates? on conservatism visibility into growth those I little can here. back context verticals then would benefits great. just in just that for gains? that this that anything But kind you context some about compares Video or the are where areas, secondly, And of safe on of obviously, can maybe schools say, or be expecting So of you're of kind into into what the government want from I deeper growth. in the

Gregory Brown

full the take first. year let's So

it's Tim, pipeline. the think so I important to say I'm proud to super year. but your in that we're is strong, of point, But as last backlog here February, is sitting

tell a year. we aged a that the anchor here sit it off year about coming QX $XX.X to full off balance good coming the but that feel our full if in when guide, color I backlog me exceeded as quarter It's a time than So And position, $XX it's the the about pipeline of remains about reference about good which also I'd gave year of we're for that ago. our a guidance. you last it's guidance. the well, makes we where higher think strong you million of exceeded at that billion,

having we I X%. you to that $XXX year Office. Now a is so all headwind U.K. million the guide that, full Home for said remind related

year-over-year, But we normalize Airwave add $XXX the you Office year-over-year, U.K. can million comparison. Home in expect you year-over-year about take full headwind be $XXX that to year million. So the revenue if

what's Jack million. backlog, strong of revenue Additionally, one to talked had other we expected And contribution be that to expect in thing and year. we worth million last about on $XX quarter Ukraine this from ago, $XXX shipped mentioning is, a exceptionally based be

the for take million Office decrement $XXX you So year-over-year X%, U.K. headwind. you Home take

point this in normalize a our guide time. quite think growth Ukraine, I and is and at for prudent You solid

Jason Winkler

native we call VMS. platform, of We've of exceptionally on Within and we're growth the we're is decision talked other a also rationalizing which approximately on-prem VMS rationalize the million about growing in the that, growth that in rate this as a seeing. of that pleased which And really our with Video the to impact made Cloud 'XX well. year. $XX of combination about One some cloud is growth insight is XX% Alta, the XXXX. into

we're continuing and So market Video? and how grow, want to we're about talk in you to doing Jack, if the

John Molloy

alluded also to healthy, script Cloud's in to I'd that are also comments. both. Jason are is we dimensionalize both Tim, but and grow. very business on-prem growing, Yes. it also, our expectations his continues

market believe we take share, to share. relates it we're continuing to As

You also video, government both in at growing are million fixed our I faster overall sales, government Total is and would asked XXXX. a highlight now question, $XXX our Tim, video mobile encompasses that government. in video And than total business. growth

So I think -- ARPA. at driven by it's think being I don't all

being and more mobility and police more by it's as more building crime. think have I driven to with really efficiency and prioritization forces they and more within contend

Gregory Brown

Tim, to George's one just this weaning PPV, off have we're we'll because benefits some still other question, year. thing, commensurate and

year, this If we're take chain year inventory and you as improved in freight through and working supply last and PPV. this elevated

at you last linearity, very half, If look it's guide to second your to first similar year. and point Tim, half and about

anything the performance. for So I'm full our sit year about with we expectation not concerned as here

Operator

from comes Deutsche line the question of next The Matthew Niknam with Bank.

Matthew Niknam

question, one follow-up. One

So supply just the on chain.

strategic talk and more bit you any the Jabil costs? rationale in to I if impacted cost disruption impact any just there? little noticeable in ] but we there bit, think give we've And the if just color on can of keep can the of any you're then at some front, a latest was the implications seen secondarily, more should Sea all from mind? about on seeing you guys Red little terms agreements, this alluded a you that's And [

Jason Winkler

be The operate ] Sure. to them is that transitioning I'll Jabil factories one first. answer the for X to them. XXXX [ agreement in second will the

to expecting. efficient in and significant profile to expectations, we're we for 'XX. will a look in scale But there that way not So an with cost the growth our well be opportunities as cost change 'XX as as growth

and it redundancy well. It we're providing as pleased we So it as grow cost looking us and additional our also us the was envelope future into us will an agreement grow. in help with scale, manage and very

Matthew Niknam

And Sea? the Red

Jason Winkler

as mode air we Sea, transportation. our primarily on of remain Red The

the a and rates negligible container ocean And so us. is of impact lot result, as the not on higher for a

semiconductors. investment everything chain, continued of So state sure air we're improvement make. rates above given the the chain we need expect to And they getting the we And found we it's make vendors, make, are particular, a supply some deliveries chips we and and supply air improving, improve in while have need that to from cases. to and good improvements on it. some continue our seen when and We've XX that of particularly to them nanometer of, in in nanometers

and be as inventory would And work we year, through end this to the the expectation improving So as year, normalize our overall again and year it. have through at working reduced the it of improve. things

Matthew Niknam

year ended to million the relative That's you [ last $XXX ] at?

Gregory Brown

right... That's

Jason Winkler

a down further right. down we The million even predecessor, to and from by $XXX $XXX $XXX That's the we [ improving ] expect [ as million was navigate ] drive an XX-month million environment. year's end

Operator

comes Tindle the line question of from next Adam with James. The Raymond

Adam Tindle

it's a that and across is backlog digestion either that and I just initially know ex Networking that reported think appears looks closely a Okay. But what if on Jason, Cisco then period clarification. led that. Jack both builds investors before for to like sense weigh be just follow-up a headline of of impact I a And think I in down. a a as very to backlog topic, Airwave? backlog or start because or appears -- than total tech softening. in. the Airwave from want that you just started hardware, give there's on in watching Greg you to backlog Could have whether or just anticipated to PCs This are us happened metric and backlog once lot records sharper trends I wanted

in shape does address the wonder normalization you what and could on current maybe demand seeing similarities of about that how if think differences state and just time or when and and supply the happen? I the double-click you're you if So of business? your in And

Gregory Brown

when you the Overall tell of ago proud X-year year start, year. this for the that at the X-year of that Airwave. just And full and things billion, $XXX Adam, a look sits. I for backlog I'm $XX.X under million is that, year decrement Yes. trend absorbing calculation ending backlog or the of of plus most I the from one would with

levels able that pretty be to that same is So reduction the with significant. comparable keep or at level

optimism thing position, so we the that but I we also also gives love backlog the pipeline. other me backlog when in his And backlog the position is and as exceptionally and ongoing we I remind I'm But the funnel by exited demand team's conversion and I'm product the the I what backlog. I The enter. strong what's you, love rates, that I and see sit optimistic in in that also the aged of Molloy at in what's optimistic pipeline. QX look

Jason Winkler

of our in I that important understand backlog. attributes, think, are to Couple

and of comes over backlog our us from customers. government our public XX% customers to First, safety our

very more And us and where strength, the our secondly, of important. entered end that, come combined -- position contractual one about that our And with that guide that what bit majority half direct think for a than revenues little will we last that's X% of So you the our the a pipeline year, growth. informs to the our us for is with is and strength, like customer, from in year about backlog. as an relationship between a much backlog, year and a

Gregory Brown

Exactly.

Adam Tindle

helpful. Very

some any from capital be benefit the Just sorry talk XXXX? it. [ working I Did quickly, in know agreement? if have could you that transitional with Jabil working cash about ] sometimes missed Jason, favorable. flow And capital may that I free expectations

flow So free the benefit? cash and potential

Jason Winkler

Yes.

$X.X inventory, 'XX improvement. that is flow said, contribution XX% up the benefits we billion. That's or operating less. within of kind $X CapEx steady minimal And capital to working about cash of billion. working agreement. agreement, We That last off do the Given outlook cash be for flow, terms expect record operating are an for year's of our continues capital is operating place that talked our the in

So another strong expecting flow. cash year we're of

Operator

JPMorgan. question Joseph with the Cardoso next of The line from comes

Joseph Cardoso

thinking that on with, to free think, XXXX wanted the nice at of exiting which, just I'm follow last flow I generation, I the buybacks, cash combination, It you'll have be just on Can you fair up taking would question. appetite I cash 'XX appreciated. than in in of dry up M&A? flow Any going like nature? a it have implies color aggressive of sheet. a when the typical to step be free cash about balance us Like a a kind more guess bit powder. should help billion cash $X.X think in to looks about deploy look you're we

Gregory Brown

capital we in balance the Just Jason, it, EBITDA. his of fact terms the sheet I always think that love have and we we of adjusted debt talked do, that net allocation, X.X to in remarks about

and to are love acquisitions being well. I gives as stewards the of So we surgical way accretive share good and opportunity, I'm both to that but of that, proud repo the flexibility dividend thoughtful us. the capital, returning it the and shareholder

you X, XX% think of acquisition, opportunities the we XX/XX/XX. this think between dividend about our available for share representative is the Even the of I made always is fungible and wheel engagements the that flow, the of only So repo Jason flow cash of the though come IPVideo, reflective that or XX%, XX% in way. end year as is at we it acquisition CapEx. just wasn't referenced, that of X had. cash and certainly

whether love the government. [indiscernible], prioritization, a there's think device organic lot public the funding, and video opportunity enterprise refresh, have I ARPA opportunity, fact that we it's of safety opportunity. I

that make our Equally, know excited particularly about or the that us stronger, Video, opportunities consequential. can of I'm portfolio acquisition either front around are are in opportunities Services. which organically, Software You

So that's how we think about it.

Jason Winkler

we'll and sheet $X.X of is markets given BaaX, our upgrade that balance we The other as thing Moody's from refinancing 'XX, debt to earn this that the year, billion. did the in noteworthy be was strength in Greg an mentioned,

our of 'XX, strength And well cash as we the 'XX in that as flow us expectations refinance. help taken the so having in will of note as

Joseph Cardoso

of court with guys guys the appreciate have And I other that like Can then just my sounded the you U.K. release, taking And Airwave? noticed option steps around in on color then to for just we provide press disposal? the at actually there. follow-up, filing application file color terms have beyond you can you are the it an an any that? your I of update options color appeal. any the and what Like next you in step? the get

Gregory Brown

we're step, Appeals. pursue week. U.K. that all but will remain to is beyond pursue about We is think believe it's thing still not to all the Court to of it. avenues this flawed, consistent wine position. doing I'm appealing we unique. said us which I've unprecedented. We going next to We along, that, I'm we next going available our the pretty legally to our Yes, anticipate in description whole and it's defend the consistent

pretty either been So point, public has that the parties made been week, and references The that Airwave obvious say months, take. long will Probably Appeals will filing different the Court of commentary your needing with Parliamentary to next they that well the It's but only is in unclear other seen. it to of that several hearings. that be how to remains XXXX CMA XXXX. The beyond by XXXX. be through I'd needed appeal to have be that U.K. made other believe the or thing will

this as as best can, ever will we network forward maintaining is customer they've in we to to need engaging we where continue been. investments we service the So move make that as and levels high can,

Jason Winkler

contract Home Office with we just a adjustment through reminder, XXXX. the as backlog has U.K. QX our in mentioned the with And current our

Gregory Brown

That's right.

Jason Winkler

There's to serve account opportunity beyond that that. for us

Operator

question Zilberman Bank the of line Tomer America. with of from is The next

Tomer Zilberman

X% in I also wanted your next to year, said 'XX, update it noted orders half it you just into year? and start first know you what off this expectations was the previously to contributed Just with want it think in to get and this ARPA. of I contribution going X%. I first an year was

John Molloy

Yes, we've before. Tomer, with consistent that's what said

interesting. the spend, I think, key more But it, states #X dollars prioritized. in have get it had safety, drafts of influx state public even in through to public safety the generally would have thing the I've situation at is budget look large, relates of as local when local public budget just By and is right Number speaking, two, -- situation solid, very state the continues XXXX. now we it scoured actually is very to remains I to and continues budgets that which and solid. the say an immigrants appropriated safety

Tomer Zilberman

know the then Got duration year? but I touched and on the has backlog as this just already, quick how backlog follow-up. a improved months in the start it. of the And maybe of maybe curious X you've last

Jason Winkler

this duration begin year. where we is of slightly last its beginning the year, were entering improved from similar to To

quality better last So than are the attributes good or the duration of the they as backlog were year. and

Operator

of Cleveland line with the next question is The Research. Benjamin Bollin from

Benjamin Bollin

picture bigger Greg, question.

year? would all, you into video year, refresh think typical growth Video fixed question the net how comes you in talking has how your line kind in about the this on around that deployments? the secondary election could top see that XXXX then of And you that you if in how target? your together about Going that an be, about how that impact, any And new for placements a XX% wild thought replacement you're versus at and figure thoughts curious guys in share

Gregory Brown

always about Yes. it's of the talk we too. Ben, interesting, this, election terms in year,

kind of Democratic pretty well back the a we Republican administration. over business, If history a look this you of or irrespective of do

in success XXXX. great had we've So

fixed talked another kind public that year and safety. On They'll we continual for of width in the about, operate and is we portfolio have do. articulated, given a of to there's Look, of generally have the actually like a beta But backlog some the that expect low I risk We a year. fact resolution. the solid of performance, and change, breadth XX% we the the this speaking, continuing priority always target level main, When presidential there in we the demand this year. strong video, high typically foundational pretty have transition. period Jason under with

that the there's So said, we a Most acceleration or customers And If, because dollar of cloud, share. with XX%, and notable broadest we cloud be in wherever moderates value met prem. of they of and meet to he customer we're cloud, that's our line that buy. believe have as the want prem we XX% great. Molloy taking are adoption, stickiness from and that's Video, more revenue, seeing moves the we've in that have the relationship. fixed we that the growth can cloud to the top fact, which okay If and of or customer seen toward still portfolio mobile, of to long-term too, both

So position. the good about we feel

to about on refresh of that? terms In you maybe want cameras, talk Jack,

John Molloy

upgrades replacement made we the Pelco varies one we have obviously growth Mahesh our it in that that us new Ben, cameras, by are drive analytics. of and X you go X to Pelco with VMSs competitive cycle in start around those were note Pelco, out of we pleased networks is investments leverage year Yes, made outside if anywhere I of the camera kind Internally, ahead XXXX about to there's in deployments, the are a driven cycle. citywide we this that thing. we would manage. the very more to think had. actually that acquisition meaning The R&D years have to there, work see But opportunities portfolio the and to in as team replacement that

Mahesh Saptharishi

Just add our one more support with Alta that thing growth Video. to just to to is

our One ability the camera the was to of acquisition that just initial expand Alta supports. thesis portfolio

now something And of also solution things cloud into more with we Unity actually special the year that bridge Video. can towards is supported an entire to of help on-prem to introduced the last about transition solution. the camera end is the think of the that's Avigilon that as X, on-prem of with within cycles also expand which the X, with and that did it to is HXSL some Unity not an the one year, line, refresh it's popular family, going just that well. and last entirely Alta It's one cloud. And was help I we an the

boundary as good a think for between I way those on-prem about transitions, the in is fuzzy us. and So bit we and cloud think, a

Operator

next line with question Housum the Research. Keith comes Northcoast of from The

Keith Housum

on the cross-selling year. walk the for acquisition. quarter opportunities of through some us Perhaps the just and the see Great opportunities where of and you perhaps IPVideo question the job forward? and on I for going you guess, rationale growth for some acquisition that

Mahesh Saptharishi

Sure.

Sensor thing So for the ] new or Video [ Sensor is not health HALO us. a actually Halo

We had years. some with -- quite partnered IPVideo Avigilon have for

IPVideo been video situations of reason key the And is locations, there sensors cannot but be solution. are certain where in actually the that plenty can. reselling schools have there like used these We in

it when where in sort the detection standpoint. of quality, a as air think comes cetera, leading of security in of HALO do become important the and install areas analytics, not is safety So detection. typically gunshot smoking to but we cameras, it vape audio vape sensor sensors, including from a quite bathrooms, et sensing,

fit our And so expanding as capability we platforms. was Alta bring integrate Unity and us and just a to really education natural think with closely within our about for beyond. in and more This

John Molloy

as workplaces, have add health expand those to transit issues and on smoking just role I the we've got they've care those of people into areas markets be where and into cross-sell in in thing of things only relationships would extend The education. our It's We well. well. you with think terms kind and as into get to can into well business that done that, that in very

Keith Housum

Okay. appreciate Makes sense. It's helpful. it. I

you question, changing gears As slightly here. a follow-up on

moving give helpful just stands? update pieces getting year. Another some there's some Asia, update the there's an would perhaps been I the where in on like in PCR. know in of the been there? supply Any year issues throughout some areas also but earlier with out be PCR of conversation terms I on know chain

Gregory Brown

in was about billion last of year, 'XX, year a Yes. 'XX. revenue in PCR it actually Keith, record $X.X did full and great

was performance for the year PCR I technology actually high single informed to would expect into by And mid-single-digit or exceptional. digit growth this you when that that's LMR the be So comparable team levels Airwave. normalize

doing is resilient and well. PCR quite So

Operator

Blair. DiPalma with comes from question next The the William line Louie of

Louie Dipalma

for bring special I partnering with partnership does for them I benefits Azure I other was think, Google providers. with major versus business? the have, Command Alta for your cloud a you wondering, know Center any

Mahesh Saptharishi

Louie. Yes,

some with, Avigilon scale for today. a especially Google already on really And Cloud to So example, begin this and Alta around scale AI. is story vectors, a video is key

delivery a Alta important. good across capability latency data expand think think Mapping delivery, so our And video expanding deploying thought broadly, was was set. we of we be as and expanding Cloud. and as would we and Google partner our about AI that capability important, Alta we low capabilities installation video within geographically important, more as our was about Google

cetera. terms the this, we to whether performance world lots cloud And sort customers our comment of a look, on the side, et best to cloud be broader today, want point. there's stuff provide more AI the that's In with at core on happening of price best of able the in services,

multi-cloud of is partnership it of the Google our this end so part at And all. really strategy

So drove it. really what that's

Louie Dipalma

are versus other? one actively of instead And Are Alta the for Great. you different the economics Unity? for significantly pushing

Jason Winkler

term a VMS the offer mentioned and those arrangement. on-prem We're Unity, as positioned an under license. the as a is as the VMS a the of choice, well maintenance with on choosing on-prem case have for Jack the a Unity, really in delivered. In both of to software mentioned, two like expectations perpetual increasingly through cloud the is layers deployed our between customers we it's difference Alta we and the delivered Alta. are The in or growth Alta, more how case And education, the customers call of

we two are Customers those are. models have, the So Jack?

John Molloy

who point decision marketplace. last, look had the as purchase competitors is we win-loss breadth both is remains X X dynamic that of are more in had decisions, and the it, that advantage of which, us gives finalist interesting who decision. the the again, call and we've speaks from Alta and solution up Louie, weeks the eliminated one we've things think there, interesting been I Unity decisions, providers have But a to things Two until at to data, very the is it's

Gregory Brown

our not say fixed than of that deploy of video Cloud fixed to video prem we And a Louie, overall noteworthy customers strong what growth contribution it's cloud revenue is the it's from deployed, Jack they while so the much they both. decides, what but solution. multiple And smaller customer want. it's the push, said many prem fixed is as video,

Louie Dipalma

to to XX% is increase XXXX Yes. is XXXX? for going Is Do Alta. that or XX% momentum XX% think mentioned the there you like of something I Video how that you with think growth Alta? in increasing from for

Gregory Brown

say don't our what on growing case, the faster know. what in composition ultimately is solution, being. than Alta growth depends But It will up ends I 'XX's cloud significantly prem. I is

year at end composition to the of So how we predict see 'XX until it's hard things settle. the

Operator

Instructions] Meta Marshall of the Morgan comes Our Stanley. with [Operator next line from question

Unknown Analyst

and a [ QX growth got on modeling. Jamie and just Command the questions Meta. of one some looked understanding Similar and accompanying lower little quarter. You've ] The XXXX and seeing impressive for earlier you're the we've strong bit what wins still Center, been growth to in that than outlook

guess, the outlook seeing what's driving as then any provide can contribution follow-up, you're should and 'XX? 'XX? And growth how I for to broadly is you on and a think what from that additional we there about detail So there as pricing the outlook

Gregory Brown

team Center, this. we we was because maybe the year. But one could Command particularly of that's And another for grew proud tag XX% I

actually Now key its obviously, in out a exceeding was Rave acquisition a to And be has driver business turned us great that. case. for Rave

$XX ], represents the headwind transitioning actually organic ESN. of of the organic million Jamie is the the [ that's solid If you growth. take normalize that way, growth of XX% out, that growth out for inclusive by growth, you and And year of another a

but when have $XX growth strong of as million, think of Center, growth overall ESN include Command pretty you the about in the to do segment XX% well. that the worth normalization you of So exit remains that's

Jason Winkler

would our of adopt continue, grow drivers portfolio, growth would that volume our including APX in of other terms 'XX, the portfolio, part expect price, growth growth of included customers inclusive from and to both ASPs to parts in feature-rich 'XX of that's in for as expect more in And the did and NEXT, of expectations. continuing we the we they as

Operator

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

Gregory Brown

on by the as the that or XXXX to entering am love fact we're Yes. security love been and most we've I I broadest I customers have we I cloud I acceleration. that Thanks. was for continue as in index the and our Google. And fact call, partnership dialing able just saying particularly comprehensive close fact and that particular, that Listen, about it's with think that safety march important. like on Alta adoption it got more February, you now clear in solution. I NEXT mentioned public in thank product enterprise to pretty portfolio. never the as would a more the and to the that APX capitalize remains in that excited forward, cycle, refresh robust. on with our We're have notable listening.

of Motorolans a to XXXX, For I year really and another quarter. doing. you. strong 'XX, in look on and great with I'm in the the catching of all listening proud in I'm you up again anticipating call, forward and of work. all I'm our execution I proud and appreciate team's debriefing in everything you're the talking Thanks for

Operator

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

Motorola Solutions (MSI) 8 Feb 242023 Q4 Earnings call transcript