A：The highlights of Motorola Solutions' third quarter 2025 earnings include robust growth in software and services across all script technologies, a strong start for Cys, and record orders and revenue with double-digit growth in both public safety and defense segments. The company also ended the quarter with a highest-ever quarterly backlog of $14.6 billion, driven by command center and video solutions. Following the strong Q3 results, the company raised its guidance for full-year earnings per share.

A：Revenue for the quarter grew script and was above guidance, with script growth in software and services and Ed growth in products in SI. GAAP earnings per share was $3.33, up from $3.29 in the year ago. Quarter non GAAP EPS was $4.60, up 9% from $3.74 last year.

A：GAAP operating earnings were $770 million or 25.6% of sales, up from 25.5% in the year ago. Non GAAP operating earnings were $99 million up from the year ago quarter, and non GAAP operating margin was 30.5% of sales, up basis points driven by higher sales and improved operating leverage, partially offset by higher tariffs.

A：Opex in Q3 was $652 million, up $35 million versus last year, primarily due to acquisitions. The company achieved record Q3 operating cash flow of $799 million, up $40 million versus last year, and free cash flow of $733 million, up $31 million. The increase in year-over-year cash flow was primarily driven by higher earnings, net of non-cash charges.

A：Notable achievements include a $140 million T5 device order for a U.S. federal customer, a $14 million P25 device in mobile video order for Arlington, Texas, and a $10 million for those 25 system upgrades to our new series infrastructure. The products in SI segment sales were up significantly, driven by growth in MC CN and video revenue from acquisitions. GAAP operating earnings in the segment were $555 million or 29.3% of sales, flat compared to the prior year.

A：The company's outlook for the remainder of the year expects revenue growth of approximately 6% and non-GAAP EPS between $4.30 and $4.36 per share, assuming an effective tax rate of 24% and a weighted average share count of 169 million shares. For the full year, the company continues to expect revenue of approximately $11.65 billion, with 7.7% growth, and has increased the non-GAAP EPS guidance to between $15.90 and $15.15 per share.

A：The company ended the quarter with approximately $3.2 billion in cash and is on track to generate $3.2 billion in operating cash flow this year, marking the third consecutive year of double-digit growth. It maintained significant balance sheet flexibility, with no senior debt maturities until 2025, and the payment schedule of its 1.5 billion dollar term loans providing continued flexibility for M&A priorities.

A：The company has made significant investments to integrate new technologies and artificial intelligence into its solutions, which are anticipated to be a growth driver for years to come.

A：The company expects spot revenue in the area of $12.6 billion for 2026, indicative of strong revenue and earnings growth. This outlook is based on strong order growth in Q2, Q3, and expectations for strong double-digit order growth in Q4 and a record backlog.

A：The SVX is performing well in the market, with early traction and orders outpacing expectations. The company has doubled the number of agencies purchasing it, now with 70 different police departments, and plans to continue growing this number by converting customers to drones.

A：The integration of the svx and the Apex Next applications benefits the company by providing a dual benefit: upgrading and refreshing the Apex Next family while also securing the sale of the svx device.

A：New capabilities for the SVX include integrated chat assist features and the ability to summon a drone based on integration with the Apex Next at the International Association of Chiefs of Police conference.

A：The silver business is off to a strong start, with revenue expectations increased from $475 million to $500 million. For next year, the company continues to expect 20% revenue growth on a bit higher base and an earnings contribution of 30 to 40 cents per share.

A：If there is a government shutdown impact, it is expected to be additive to the company's revenue growth forecast of 12.6%. The company is closely watching the timing of the impact and the need for the government to approve budgets and work efficiently through the queue and backlog.

A：The growth drivers for the product side of the portfolio include many parts doing well and being expected to do well into the next year, the evolving product mix, and the increase in customers choosing more feature-rich devices like those in the Apex Next line-up.

A：The gross margin trajectory is expected to be positively affected by the product mix as customers increasingly choose the more feature-rich devices like those in the Apex Next line-up. Despite some margin compression in the second half of the year, the product mix favorability has increased margins and is expected to continue improving with a strong product portfolio moving forward.

A：The updated expectation for the growth of software and services is for low double-digit growth, up from an earlier guide of 10%, which is a positive development.

A：The conversation suggests that while some factors may be temporary, there is also a longer-term shift in the business towards more software and Apex Next apps, indicating a fundamental change.

A：The company plans to continue expanding margins by leveraging the strong growth within software, applications, and services along with the product portfolio. As customers continue to purchase devices, the low penetration of Apex Next devices is expected to increase, driving margin expansion.

A：The road map for Apex Next includes continued verticalization and more applications and services developed by Mahesh and his team, with plans to further leverage the standard Apex application services.

A：The company plans to utilize AI by being judicious and thoughtful around budgets and managing expenses, and by deploying AI in a surgical manner in customer service and engineering teams, which is expected to increase the penetration of AI and yield operating expense benefits.

A：The potential for pent-up demand in the infrastructure sector following the introduction of a new product is considered significant, as there is a large existing footprint of statewide networks. This, coupled with regular contact with customers and the movement towards infrastructure and managed service, indicates substantial growth potential.

A：The new infrastructure upgrade is expected to perform well as evidenced by multi-year deployment orders and large multi-year contracts with states like Colorado, Michigan, and Tennessee. This indicates a durable long-term investment and a positive outlook for the future performance of the new infrastructure.

A：Customers have actively adopted the body camera functionality in the svx, including redaction features that reduce the time to share critical information, and assisted narrative that reduces report writing and revision cycle times. Anecdotes shared include successful use of real-time translation during a domestic disturbance response, highlighting the effectiveness of these new features.

A：The guidance remains at 10% to 12% because of the strong performance of the cloud video solution, which grew faster than the 7% reported, with even higher order growth. The company is confident in the current mix and composition of the backlog, with an increased software and services component, strong demand across the portfolio, and an expectation to grow to $500 million this year and 20% next year.

A：The company has managed tariffs effectively, with incremental tariffs expected to be lower in Q1 and Q2 as they lap the back half of last year. They anticipate the opportunity to pay down some short-term debt related to Avigilon, which will provide EPS flexibility.

A：Early learnings from the acquisition indicate that the company is more bullish and enthusiastic post-close, which is resulting in raising the full-year expectation from $475 to $500. The acquisition is showing high-level engagement in defense, borders, high bandwidth, and unmanned sectors with international growth being particularly notable.

A：The mission critical data segment is seen as a leader in high-speed, low latency, mobile ad hoc networking, complementing the company's mission-critical voice market leadership. This segment provides growth opportunities in defense, autonomous, drone infrastructure, and man markets, and has been validated technically with customer engagements.

A：Further investment in Silvis is expected to expand their international outreach, with plans to fund headcount and enhance their research and development capabilities. This will increase their capability to penetrate new markets and will build on their first-class sales engine.

A：The company is uniquely impressed with the cultural fit of the new acquisition, as evidenced by the team's dedication to customers and their focus on innovation. The integration has proven to be very complementary with the core LMR mission-critical people, and the cultural chemistry and mission orientation are expected to drive future success.

A：The majority of Silvis's business is international, with opportunities in defense, US DoD borders, federal, and state and local agencies. However, the focus is primarily on international markets and defense, with state and local opportunities being dependent on future FCC authorization for spectrum. Domestically, the technology can be utilized in multi-agency, interoperable environments such as major events.

A：The Command Center experienced growth of 16%, with success attributed to continued growth drivers for next applications in Apex, additional strength in the control room or 911 international parts of the business, and ongoing cloud adoption and subscription trends.

A：Svx is positioned as a leader in North America and Australia for AP25 devices, with the company reporting success and deals across Europe. The market is aware of the company's market leadership, and the competitive nature is discussed in terms of total cost of ownership and the preference for a single device with interchangeable battery life and coverage plan. The company contemplates the market is navigating to a solution that best suits the total cost of ownership for the user.

A：The company has a long history in building mission-critical audio quality capabilities, excelling in isolating and enhancing voice in the presence of ambient noise like sirens, and has expertise that is paying off in the context of Svx and competitively.

A：The company sees significant opportunity to grow the SMS contribution by offering more software and services around a strong platform with very differentiated hardware and software-enabled devices. It aims to grow the SMS contribution from its current focus on products to include more software and services. The introduction of features like low probability of detection and anti-jam capabilities within the Sylu streamcast radios is seen as software upgrades. The existing installed base of software-defined radios on Cots hardware allows for rapid inclusion of new capabilities.

A：The company has not directly answered whether the script growth outlook for next year includes SMS revenue; however, it indicates a focus on growing the SMS contribution and the potential for growth from the current product base.

A：While the company did not provide a direct answer, it implied potential for growth by discussing the long opportunity ahead to penetrate the entire base of first responders and the expansion into unmanned systems and international markets.

A：The company has done analysis and foresees only small puts and takes at the effective tax rate and cash tax rate, which is nothing meaningful. It affords the company with flexibility regarding the impact of the tariffs, which are viewed as favorable to the overall selling environment.

A：The company is mitigating the impact of tariffs through inventory acceleration, sourcing with two suppliers, and lead time load balancing. Manufacturing that is USMCA compliant is also helping to mitigate tariffs. The company's supply chain team has proactively anticipated different scenarios and fed that information to operational improvements.

A：The sales motion for Sylvis involves longer cycle sales efforts as it gets onto programs of records. It plans to increase sales coverage on all levels related to this. The process differs from other technologies in the portfolio, with specific focus areas like long-term benefits in international markets, and trials with domestic drone manufacturers.

A：The relationship with Aero Environment is well positioned for growth, as Sylvis is being used in the new Switchblade 400 loitering missile. The company is involved in major army programs like Next Generation Command and Control and Soldier Born Command Center. There are also collaborations with the Bundeswehr Germany and other longstanding projects, indicating a global presence and involvement in significant projects.