Motorola Solutions (MSI) 4 Nov 222022 Q3 Earnings call transcript

Good afternoon, and thank you for holding. Welcome to the Motorola Solutions Third Quarter 2022 Earnings Conference Call. [Operator Instructions] Presentation material and additional financial tables are posted on the Motorola Solutions Investor Relations website.

In addition a webcast replay of this call will be available on our website within two hours after the conclusion of this call. The website address is www.motorolasolutions.com/investor. placed listen-only been have participants in mode. a All

Investor to after now begin today's will President to have [Operator your questions opportunity an of Vice Yocum, will You conference. presentation. you ask Instructions] Mr. Tim Mr. Relations. Yocum, introduce may like I

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

And thanks good us joining afternoon, Tim. you, Thank for today. and

First, our EPS that grew funding margins and points. QX expanded robust seeing demand environment We we're strong business. by the revenue XXX and across the highlight XX%, results continued XX%, operating basis

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

solid Integration, led record was during the technologies our XX% our for in growth demand in remainder for finally, achieved second results up exceptionally the based year quarter. our strong we're both total consecutive Services QX radio our And Second, QX and Systems and full when $XX expectations And land for X% up expectations despite mobile segments raising and FX. Products of execution million $XXX now FX we continued both about revenue headwinds and full the EPS our year quarter. increased of in Software normalized last that for time, for revenue supply and million security and year, the in XX% from chain guidance on revenue and video sales to

now returning to our this take outlook you Jason call and results to at the I turn point, thoughts. before So some over will through final for

third and you, quarter guidance quarter was in above grew XX% Thank Revenue segments. for Greg. record both our revenue the with

a contract. was $XX ESN earnings operating quarter higher the was margin affected year. margins during charge tax the GAAP EPS from gross to million, $XX to last was driven per $X.XX fixed added ESN technologies was And share, $XXX operating by QX contract. sales, security early quarter, ago Non-GAAP to due from non-cash to during Non-GAAP operating ship rate during GAAP from growth exit growth higher recognized quarter. expected control. million year from all up by to now acquisitions improved $X.XX XX% across supply asset This non-GAAP chain the related charge the the XX% in per of particularly OpEx margins, was in well were ago share a additional year, in This Products product in in enabled last grew while FX segment. and the three million, earnings million in quarter year were $XXX million quarter the versus and execution as LMR, by margin earnings in growth the the were stock which saw sales $XXX led as operating share recognized revenue. higher $XX million. the current per related due operating to operating related up comp us strong impairment million X%, driven our access acquisitions. higher in up to and of the headwinds margins, year. up GAAP leverage, also In XX.X%, XX% We lower a SI $XXX video compared planned the $X EPS primarily XX.X%. impairment were increase $X.XX primarily XX.X%. inclusive exit from were benefits

was year. $X flow cash was $XXX prior million. QX to with free Turning million, flow flow compared And operating up $XXX the million cash up million cash $XX

$XX and environment record $XXX cash seeing we're Capital million chain share $XX we LMR. primarily cash deliver security which dividends, in inventory, QX execute video lower year in supply repurchases million be helping included is to our expect investment demand of continued flow to the for in $XXX full and CapEx. due the in and in a million dynamic approximately prior us against For our continued than operating million guidance, allocation

the $XX we million tactical quarter, of Additionally, supplier during a for and specialty frequency closed of of Barrett the acquisition communications cash. net equipment Communications, high

contributed XX% were both the including LMR quarter, QX video. last in results or SI strong $XX XX.X% Operating XX%, increased during and Products of up partially in than year, year full were versus quarter from orders higher LMR margins this earnings segment $XX pricing acquisitions and we leverage, driven as Sales segment, QX Currency by million. to for The be operating were see in orders continue actions both and demand to to last and $XXX prior primarily video. were our record up continue from Moving the headwinds from across million year higher and the by revenue up and higher impact the XX.X% expect year. offset to material sales sales and in million costs. expected, we operating segment in

or single $XX a and state million $XXX order and us of project include unique NEXT was order Avigilon. of in FX segment a driven of a of customer for Total fixed federal and $XX customer acquisitions. up million achievements of million company Florida; earnings North the equipment U.S. by devices transportation from notable X%, In LMR order segment PXX valued of video which million and million in acquisition award from software in demand Transit years. from $XXX This from in Software customer PXX PXX largest $XX customer, revenue integration revenue System was down PXX $XX and million XX.X% Southeastern were basis received a duration includes XX devices from over video the strong points was up million order order includes higher APX a new an in fixed wins $XX $XXX a $X for FX last Africa; headwinds Africa. Some a for Pennsylvania by Authority; million in expenses. the in County Operating Services up year $XX major video, order is Europe, an order after services Israel XX sales, a TETRA also Miami-Dade XX% $XX in system in million includes software, ever from million at revenue driven while from $XX a million that revenue a from and QX X% headwinds. over and of our million

segment and of command $XX a the order won QX renewal camera the $X a in a the a Safety, suite Phoenix. million command Department for multi-year Ellis Public of renewals, center push-to-talk $XX software $X large County, million of customer service and with a City million include LMR in million order the East, notable Texas center from million Illinois, a broadband Some Also, $XX Maryland million two over Middle with State the order body-worn County, $X Will for software with highlights Texas.

$XXX America last million, offset revenue Looking up all results, three was versus was at International three QX growth all in $X.X partially technologies. on X% growth regional unfavorable revenue technologies, QX by FX. in XX% with year North up billion,

in increased and $XX by contracts consecutive last In the by large million the year. of demand up unfavorable adjustment ESN. approximately $XXX a to and to continues $X.X $XXX FX a to Software in of million, $XX.X software year, of billion sequential the of extension quarter the $XXX quarter offset segment, driven ESN million XXXX, Sequentially, last segment. three of $XXX was of and backlog, or million driven XX% unfavorable million by Products was backlog backlog million $X.X in contract. multi-year million all and orders up LMR by compared and record was was driven the exit FX our $XXX the billion, fourth adjustment extension Airwave million related million during In offset ESN. the and was this to to $XX $XXX The from in of by backlog, America, increase to Airwave inclusive demand year, received Services partially billion reduction robust Sequentially quarter, both was last several a order technologies. services ending North ninth record up backlog which partially the in FX was across unfavorable to and which SI and orders the video drive Moving recorded planned and growth backlog backlog QX for up related growth or $XX XX% up compared our compared

unfavorable the and ESN revenue driven Airwave So backlog was FX, down adjustment quarter. during by and recognition or for sequentially million the X% $XXX primarily ESN

be our QX earnings to XXX weighted sales to assumes per per This share, of with FX Turning now share XX%. effective expect share. $X.XX of million X% between of and $XX count outlook, rate average non-GAAP approximately an approximately $X.XX shares, up tax headwinds, and approximately we a million

I XX.X%. approximately our This related average our million And shares have earlier full of EPS environment also expect historically now translation year and share, our today. currency be what year the for guidance $XX.XX $XX.XX per our revenue increasing the year supply been the At million as with the earnings overcoming million finally, a with we now we $XXX from expected a FX the chain to million increase costs per full actions year, share U.S. year, $XX.XX and includes by up dynamic teams pricing secondary guidance, growth assumes and up then. $XX $XXX XXX updated semiconductors headwinds premium. headwind year, to from from million us X.X% and we've stand not in increased full This $XX headwinds I'll $XXX we guidance impact both carry of reflect share. significant have guidance an The expect we made the the for FX Greg. EPS to share now of of approximately higher and full on now our decisions we and $XX today beginning updated higher increased left over to only dollar. the months per but the procurement revenue where inventory I'm of since the higher revenue prior guidance full of our in just the between prior revenues. that product we to headwinds have premiums encouraged included increased during prior implemented another to of guidance revenues million, We impact enabled two call year and up to on This again. tax navigating between from effective And semiconductors and of weighted are over strong our have count X.XX% our turn indicated revenue back the expectations in at and these offset pay non-GAAP how a For X%. FX supports is a year million The materially has a drive rate year. markets of $XX.XX

face of team in Thanks, our we the Jason. and FX We the We QX of the execute our with extremely here that's continues And the Motorola again, record ended operating and some and XX%. basis ending sales really segments, significant proud all XXX $XX.X at by headwinds. results, by up up is to in EPS across I'm margins areas QX pleased expanded quarter points, billion, of I'm of achieved both how with backlog people XX%. record business. a

to continue while new ecosystem. invest we also Second, results products deliver and both in strengthening to these continuing our strong

three we as feeds video built-in into command strong. all the expanded During drone camera forehead cloud-connected our extended car emergency with new momentum Ava ahead, quarter, that We and in cameras additional personnel look integrations video business analytics. CommandCentral announced sizes, the we with the our I and and Quad, successful into cloud-native And Aware, suite our the center finally, needs of of portfolio radios with NEXT of support a several body-worn device agencies bringing budgets. APX is

and and into helping of supply environment positions turn call challenging questions. meet this and is I'll us backlog increased our now chain are for record year Our it up over we'll navigate strong combined a to for growth investments well solutions, in the back execution funding a the robust inventory our driving us Tim, another your higher earnings continually and environment demand open record QX portfolio, for with demand our XXXX. revenue to

Thank you, Greg.

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

open floor [Operator from from first Instructions] The Tim comes Long question is for questions. now Barclays. Our today

open. is line Your

may. two on [indiscernible] is questions, I Tim I if This have Long. for

in then is should think of mentioned inclusive the remarks just be contract. the negotiations also Thank get the how kind just prepared of there, And to color expectations? managing And a contract? there given And of of raised Kodiak you. in little Or is exiting and think your bit had now, about just trying release home you ESN we guys office? concede kind your more of would the You revenue? that anything kind with XXXX you'll high more level guidance need about kind to that

ESN, of I a terms Lisa, ongoing it's with in conversations customer. Yes, think result the of

likely where that there's toward that think be stage, more XXXX. expiration I it's the signed I will have advanced we reached at of an late-stage that in a than interest more an conclusion to with and than We of this But we ESN mutual think don't exiting kind at continue point, they agreement think recently, not them negotiation earlier this work reaching point. end. we

XXXX, it's reasonable I think think a So thing bit we to right still Look, both think moving forward. for terms a we way of lot the of to a of It's do bit print. a early QX lot little have parts. little I news the There's know – in and about. a and good

about this point billion at time, revenue we think $X.X of think XXXX. I in in about

XXXX. it's we'll with also into level, We things we dealing technologies. expect that some But still there's three that that within at worth could be grow all noting

those challenges that purposely those Jason we're carrying But experiencing, about supply be why referenced, which $XXX then way, PPV year we and actually just one in by is in of we're have semiconductor which, continue therefore, about the basis we thinking. think will that to into I and supply FX also inventory – next think think, I well at our QX chain about would levels of to million, this than February. the we XXX look higher XXXX and chain are all thing in you think more XXXX the points give we'll will paying still higher that one other is in field example premiums. chalk which the specifics higher high-level semiconductor, terms us more of inventory and headwinds again, XXXX. inform of I higher think And of moment, I XXX continue half our obviously for constraints moment, headwinds that carrying of to at But around thoughts that would expect alone. tax rate into

Lisa, ESN. also question color around your if to I could add

as and million. integration So for to the going some are the be project. revenues this year the as approximately MCPTT That well the of ESN includes $XX

the what working the in of with mentioned, part Greg of As as negotiation, revenue through transition zero to services that for like looks next of the that go We're and terms in XXXX. contract, will what exit year.

this $XX that you update we'll top in line ESN. it on So as concludes. year's million results But from

so you Thank much.

Thanks Lisa.

We now turn to George Jefferies. Notter from

is line open. Your

CMA. same Airwave? a wanted Hi, guys, you're negotiating the help of How home about on you the I ESN guess, in presume keep and contract thanks you I the that very crisp and going to this in negotiation? much renegotiation Does on but all and do exit Obviously, negotiating point congratulations revised extension, the with I a it? here. the execution with the questioning. growth office line just the contract is see of

Yes.

to I two returns us about on the customer to our talked investigation with you, both with working of ESN and in earlier CMA role structural than look, of we the remind the is think secondarily, being Airwave dual apparent just evaluation decision was undertaken potential Airwave exit XXXX. the And that. the and tenants. of the expiration ESN, One

it's it's remains table. issue I to Airwave separate. return ESN, the the think And obviously while on related

convicted having decision with disagree in findings, position. that, provisional the that provisional recently, decision our out more and around Now we CMA's we said came their still the are

I economically and decision feel flawed. the think CMA's we provisional legally is

conversation included the in middle the funeral. of satisfaction network the the Queen's ever planning highest It's we kind home we've are as That unprecedented which coincidentally CMA UK ironic I had performance to Airwave, think overreaching. incorporated It's the that the all close score said, month for the in proportional. we with with continue this of it's and not office. customer Airwave we and in around on and September, stay also of of had

we'll continue will So thing avenues do. and our work including to to and if us, think pursue the we that's position all available are legal look, to right we defend that it, appeals,

Thank it, Got okay. you Appreciate very it. much.

Our Erik Lapinski question Morgan comes from Stanley. next from

Your line is open.

to you just quarter. things back and hardware get Hi, a bit the at able sales It higher ramp you're maybe to the dynamics. fully sounds Congrats least chain like to at maybe to pretty of see supply but good some go supply piece a and wanted sure but on a improved, little thanks. the I during quarter really did haven't the price. I make understand in

you. if kind an of bit give the feel just you think in you the exactly to where just we a that And Is due due you're And of backlog we just just update the Was be about maybe environment. seeing better, trying us could maybe just in as that factor bit of backlog, hardware on of of supply lot. supply growth ramped a helpful. some there to understand Thank little So we details shipping a constraints? would like are to in then more really a times? context that kind

Sure. Yes.

I I the think team think mentioned, we'll constraints supply I semiconductor this. as remain. tag But

been analogous you've laptops, heading recession, industry. and we're there's our that's continues supply as more smartphones and towards demand embed to us. legacy silicon the to to The written semiconductor the supply we a constrained. Now automotive industry there, automotive is doesn't softening and And and seen more be a solutions that lot said about into PCs, apply that

leg that redesign. satisfy demand, meet satisfying this we'd $XX record in $XXX just incremental is making And referenced, we of lot thought premiums going PPV higher the this PPV the paying more to year. premiums, is spend third we're inventory don't to to decision is pay had to a in the we're demand product The $XXX the relief. spend million progress So we we of record stool million, see demand. million said carry Jason full for

in I margins redesign and environment this spend challenging satisfy on increased product supply better doing us. to So stiff continued is the inventory, record for very the earlier and We're calls inventory, on I've slightly higher think demand. still but referenced the PPV

automotive greater the I of would on success not been incremental to us are XX getting The we and going customer aligns componentry front, what's that business supports in needing on and to fulfill prioritization get good that in that most automotive we backlog heavy industry. add, to nanometers a customers Greg, is looking the And LMR what having million waiting $XX have in it we’re and for. need. is only decision, also that

anticipate particular, we and quarter the in in QX, had PCR getting delayed where parts shipments this to QX portfolio of been for. getting in in again we’re So that strong componentry

while to or year, going grow this could last we example, anticipate XX%. with XX% We quarter grow the for would grow of for now PCR, constraints year. it’s it thought So here

components So example. the an PCR we’re getting as to necessary to that access some unlock of backlog

in that helped well. up PCR and the to for the because take both now growth the inventory year, And it has also XX%. video higher annually helped a available inventory higher to has as access from of product. By has decisions, this way, also security position the share video afforded be expect XX% control us in and We incremental some

It be sure. market advantage for in competitive a this can

on congrats guys. the Well, execution. Thanks, Awesome.

Thank you.

next from Our Suisse. from Sami comes Credit question Badri

open. Your is line

This Hi. for Thanks Ryan on Cui Sami. question. the for taking is

two I So questions. have

remind level we First of And increase is, far? many price the increase price is tax. considering can have us expected round done alike inflation like round so of another been should of there how you

going and price. the are be So to year for both our results driven volume by

supported as half earlier because we of half even impact churn into year of the many begun prior we by year more place second the be to in this price the actions second put backlog. through The will have

second done They’re we’ve a growth the So We’ll we our in our to at look across continue and expected, the value-based as that, half. pricing portfolio. variety enable of results helping differentiate does the the doing solutions near team we per price to to team work and Jack and pricing on value. R&D is the of million spend that our year around $XXX

squeeze I in another one. that. appreciate If I you. Got can

considering like slowdown, in So EU are potential from the like broad like macroeconomic of risk? market seeing any signs you especially the concern

that. seeing not We’re

Motorola can’t the Solutions that print, think, QX across for I I people And enough. think again, the itself. thank speaks I

has quarter moving continued a right? parts, superb. QX by dollar, I on of the strong. And lot think demand the of with we’re think record moving further been focus pressure also ending And The the supply a but not. historical so lot I backlog, parts, and remains there’s challenges, reinforced execution

been our biggest which when vertical – initiatives you education, think Right, given schools, that, Safe market just really safety, issues only not the business control, you of that there’s to obviously and being Rescue pointed Cities is a Bipartisan outside also schools. which when piggyback directly public through around the that’s hot next on funding around Act, our the there’s access analytics, American through at about Plan, funding addresses ingress at access, egress, safe

Got Thanks you. much. color. so the Appreciate

We now turn from James. to Tindle Raymond Adam

Your line is open.

I return to exit. the Thank on ESN conversation Okay. wanted the you. to, Greg,

investors becomes Airwave that does as I go kind throw decision Is what for mean view after that I think much don’t Does out it both talk hedge Airwave hands? to like the having I Jason, of wanted at – you this? the understand to network if to strategic ahead, lot Greg. of ESN? then about potentially there. point, hedge can it and why too like given LTE some a $XX million What retired? the And going exit had? kind a alternative seemed so change away LMR, of that you that mean to business And

to want keep sorry. going sorry. get the ahead. Go to I’m We on. everything other. I’m sorry, I’m No,

my but going the was of said sneak highest just million understanding to this Jason. wasn’t in was I for profitability. revenue, He $XX

understand the of just wanted profitability this. impact I So to

Yes.

asked ever I it. looked at bid ESN we as On don’t to We on question, back think when We did. a way first the were hedge.

Airwave deliverables. the has building same by said, lot closely They’re network – I obviously, And ESN they expectations We’ve customer. had and plans delivering what customer committed certain UK hedge. think this I from the been fully MSI a a fulfilled But I I to and with as a viewed to on the project. the we’ve never we’ve they’re us. it be as home for our viewed worked ESN. interrelated again, they’re to and ESN And office.

do advance in year a discussions quarter, more recently As I the thing right past It’s to this think and mutual the to exit. the agreement. there’s

anyway. original at end the the it Now was contract, of expiring XXXX

it So both right we felt I do. to think was thing the

about what $XX less with next million but that year. XXXX. next for exactly of Jason said in obviously looks terms like than revenue it’s $XX goes zero million, year, that worked agreement to for out As to And be that year this a transition in and has predicate final

it’s rest And of of margin, the terms you’re than in right; lower S&S.

You it as integration supplying to MCPTT. think of custom to addition a in project them us

So margin $XX integration like that it’s an million. profile on

simultaneously And the FirstNet. at and fact, same domestically And states. the point a U.S., things FirstNet, in time, LMR record And to LMR grow now in that. we to subcontractor we to all to are here which for while the we U.S. to where continue participating Adam, build in I’d AT&T a we in high-speed XG is and you see demand evolving participate for here network, the XG, LTE in

it I per I as and se. So a it don’t as hedge, trade-off see see don’t a

it. Got

of point. looking structurally that we price in be I not cost perspective, million in debate cost $XXX the model price come mean and $XXX Okay. from agree different the when but about be your there some equation of at a at business? permanent. subject, with point? these wanted And think million what’s And then probably to can the need out timing that’s talk a the margin increases. comes your price price model. I we other It’s to I comes think do of we your going business to can implemented Would out out I’m point? all You’ve level a price intention happens, that might wondering at sticks Or when you at all that reduce

on commodity scarce by products $XXX third-parties that view million the market are We a driven extracting right value play our maximum now. than in brokers of the as really increases and temporary price conditions stickier

look looking success driven and now. are portfolio there’s forward, at parts through had to prices we to our we at that customers, But the in the we’ve and the with good engaging right – So continue as we’ll there. need that the market opportunity parts procure

Yes.

tier The think at this public said, other to bit a when into backlog a in remind elevated into year, we as being we million. second, lower that next would XXXX. $XXX to shipments is, PCR in I some have thing and QX we to so safety peel off of of counterweight remain XXXX expect levels inventory we’ve sitting that prioritized just also flush will well little you have year about a you, through And

really to simple the the Is is a do Is x to there is mean XXXX? in too dollars just it about incremental think I in think there an way spend? dollars to million of easy x way Or price was that? a $XXX for complicated and price to understand. XXXX us

No, I this. say would

For full we’ve price. the a Adam, could half, and and but further some point had more volume price dimensionalize growth to pricing in with for the being XXXX, bit little thoughts at the we to still than be be volumes it would February, we expect you both around give maybe increases, but best year, appropriate time. the volume that’s this in growth Year-to-date, is

you. Thank Understood.

Thanks, Adam.

now Loop to We from Najam Capital. Fahad turn

line Your is open.

million? is clarification. question. Thanks backlog, wanted Also, ask of your I much it first that S&S for you to ESN? Is my about from $XXX taking the how fuller

reduced. million contract $XX of value was

in Yes. a backlog. So reduction that’s

Okay.

no So that’s carrying the S&S. ESN were backlog There’s of million. in in related projects right, from the $XX you entirety the that, additional that

most I the balance Those our the two the financially well our non-cash million future most we’ve million Yes, probable likely think as to to the is decision delivery. had as are the right. ESN are and project decided contracts $XX reduced we sheet, corresponding by to what $XXX most relevant numbers contract charge that exit outcome. the backlog That’s for of as a off

Got it. you. Thank

in terms Greg, the majority revenue Just us to year? next of maybe you take you’re that? maybe driving thinking with Are kind of stimulus said the of you of your questions. being through how expecting what’s double you’re you calendar I funds? benefited still XXXX. about how my from initial click us. to funds up show But Now appreciate could outlook, if much

Sure.

that thing some the with a important the million as run American said, this what some in have. be take bigger likelihood, element through in $XXX that to it we’ve Plan. a a multiyear year-to-date do, ARP out that well. to and tied is have So to it’s of need XXXX to always Rescue extended probably all and phenomenon, we not in got point point revenue is to But funds The way will nice back through QX to that’s it’s

I think year-to-date million quarter. it’s actually $XXX

You’re right. Yes. Good clarification.

All right. answers. Appreciate the you. Thank

Thank you.

Instructions] We JPMorgan. from to turn Chung Paul [Operator now

open. is line Your

Hi. Thanks for my taking questions.

some see that mentioned expand you type billion kind and and feel expect Can as you $X.X the initially. video growth that Can pace you next start kind see pricing year, with about expect can to also we of you we of you in Hopefully gross come growth it? the XX% So down? of to come and think for costs chain we segments? component between comfortable still on margins of start uplift, XXXX kind should supply you quantify down

Yes.

giving Paul; really think directional in is be than the specific. meant the color $X.X billion I'm I more to it that,

backlog have February. we say the technology aspirationally anyway segment history when segments I operating we the see again in around around XXXX, would say but the and specifics individual the view. technologies margins want from disposition would specifics look though, of to more reserve to QX that print, us margins will better been we and in inform on operating and goal earnings in the detail has standpoint I'd that the call our expand margin a from will next February and ongoing it a we think I

cap kind see to then into across pricing Appreciate and bit XXXX? starting on implies guide of a risks some in follow-up What helping that that. component a and are cast flows even ramp free it. guide here are your Got And XQ. record some Thank working to that visibility you to here you. hitting flow cash in

billion quick quarter call flow so of We've door the such supported call have cash QX it million in they QX the in opportunity. AR turn. during had Our QX cash portion in lower QX and inventory operating about had getting the the QX so getting current is elevated lower by we my that of $X.XXX call. we that are anticipating flow Half And a second did half; it we sooner good turn the again cash we payments can and of tremendous and anticipate linearity we in then quarter, we'll very anticipate out another good year. talked to the $XXX in the around anticipate to products to within almost [ph] we inventory better sales of course our level, higher we slightly having end X,XXX

Got it. you. Very Thank helpful.

you. Thank

from question Research. from Our comes next Housum Northcoast Keith

is open. line Your

you mentioned adjustments what with color provide if Airwave? guys, appeals the does process, Motorola that afternoon is proposal, options Airwave CMA through actually appreciate the the you have will the coming I Good this little about successful for can talk perhaps Greg, it.

To final a provisional. what you Keith. decision is is Thank implementation that that it's final sort final out decision terms until year. after of came months Yes. the was out a then how to that phase early few next expect worth there remedy ruling takes decision don't a in question, your a Again mentioning actually more to implement. We

decision. be think that statutorily done months think has after the nine I no or final to it's think, I I later XX than

do So develop, go than more that takes there would and embedded unprecedented. going agree to provisional We are several continue there's the and to told customer. for referenced the position we to with arrangement we'll see notation the how time office but actual also in By provisional certainly explicit while conversation, to convicted is obviously decision potential a it's in and open and We the founding's the that has be I different things are are includes what and CMA we unfounded overreaching a our here. you in the the to and the so in mentioning That's that the months an to worth way and home proposed. think work that. to invitation CMA provisional. us that

then that And strength competitors color you for been are year, it. guess, around the a world. I there? get of guess for it's Appreciate follow-up that of I'm some getting growth Chinese lack that bit Obviously video better could. more Is challenges, some could growth? about around if country of goes notable word going that to to the to XX% – different from going contributing surveillance The XX% from I some I'll a I of the your by ask a my actually – question

that it's were the Dahua, future level in I Chinese of Hytera, I of think at think procurement kind kind direction it NDAA, this some the against clipping out, the not is from and but suppliers is you inertia Act because answer your I Authorization question adding under remember and of year? think the but to growth is yes, fed rip Defense Hikvision, it the actually the a ZTE prohibits Huawei, the National measured replace. our

there, moment So the clutch which money. the grant same NDAA thing big I provision of there's think growth terms the pop don't in around of is the

in could be case as and lines help potential FCC NDAA, by move video Secure be be circumstantially And of tailwind the of contours the in the The case prohibit that potentially favorable. or enterprise, take of positive Hikvision for will that if other follows also along FCC the the Dahua which level, procurement. kind a procurement security the future would the it way could but the Hytera that But of LMR, November, at as the Equipment time. as could early could more Act

contributor I to think results I the favorable clearly but trend, – a it's we're date. and an to driver but don't it’s So a printing overwhelming think it's

Great. Thank you.

Thanks, Keith.

comes from final question Jim My from Suva Citigroup.

Your line is open.

growing area. and long about a type our of a Can actually is situation much. about your and recently products comments, like seems PTA insights sales mean, an had little bit I but outlook? now like versus talking importantly percent discussion. great school Education, on Thank give recommended you the your great hear. you us which a highlighted just a technology I of putting in that's meeting – of of it's you It very to

you timeline can I increase districts. to seeing? self about starts there Thank as the the kind of so school districts you itself the pretty what so you're at seed kind And continues but start of point, other talk school hard? certain seems to to other kickoff profitability, market to of initial And And assume solutions much. it some

and security might now cloud-based at are a is you there, of it, but organically, private game di-mensionalize are a our control of Ava directed around acquisitions the Openpath organically of it very business. It we've think and and investments pointed the as by school thoughtful may an a Avigilon started it lot that investments solution, actually just the seeing, they and way only of not made we've fixed inertia, districts of out, smaller because Jim, but money video you and want with access the nailed thing the made and solution. it. a been schools, larger what The as around and want we've that one being we're on-prem XX% to

to like they we meet got So where feel depending obviously their we've the customers on needs – got the we've are. ability for

a of the In growing XX% in category have security this terms video print roughly you've of growth fixed rate, approximately growing year. XX% our so is it's we seen quarter business growth. Education that

our doing position integrate to of of And integrate safe. maybe portfolio portfolio also further we're to of some and an Schools. the you talk better could schools things the all we to investment portfolio, our this is about Mahesh, so as area in Safer around keep

the and of element element is and radios to called key detection a notifications technology of coordinate do that our to effective Introduced this long Reimagined are actions Safety within program enables partnership possible just that the really one Orchestrate including timeframe. private things a response enabled AI called well all capabilities even of of cameras this ago; school, during fixed as solution public to us – was a and the a Safety to Orchestrate not Reimagined enables

we Motorola go entirety advantage the portfolio, of in problems it for when are schools. you positioned solve to Solutions put So specific and all the and uniquely it of takes together actually

Thank you so much congratulations. for details the and

Jim. Thank you,

Executive for comments over turn Officer Mr. Greg closing This floor any Chairman remarks. or question-and-answer I'll to additional the session. not Chief concludes our and Brown,

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