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    MSI
    Earnings call· Dec 2025(Q4 FY25)

    Motorola Solutions Q4 FY25 earnings call MSI

    Feb 11, 2026 Source

    Executive summary

    Motorola Solutions Q4 FY25 — Record Backlog and Strong Orders Drive Outlook

    Motorola Solutions delivered an exceptional Q4 FY25, marked by record revenue, operating earnings, and a substantial increase in backlog, driven by robust demand across all segments. The company's strategic investments in AI and product innovation, including the new Assist Suites and SVX devices, are strengthening its market position and are expected to fuel continued revenue and margin expansion in FY26, supported by a strong pipeline and liquidity profile.

    Highlights

    5

    • Q4 revenue grew 12%, exceeding guidance with double-digit growth in both segments.

    • Non-GAAP operating margin reached a record 32.1% in Q4, up 170 basis points.

    • Ended the year with a record backlog of $15.7 billion, up $1 billion year-over-year.

    • Full-year operating cash flow was a record $2.8 billion, an increase of 19%.

    • Dividend increased by 11%, marking the 14th consecutive year of double-digit increases.

    Concerns

    3

    • Higher tariffs partially offset operating margin expansion in Q4.

    • Higher interest expense partially offset EPS growth in Q4.

    • Higher tax rate partially offset EPS growth in Q4.

    Guidance & targets

    16
    CategoryTargetConfidence
    Q1 Sales Growth
    6% to 7%
    high materiality
    High
    Q1 Non-GAAP EPS
    $3.20 to $3.25
    high materiality
    High
    Full-Year 2026 Revenue
    approximately $12.7 billion
    high materiality
    High
    Full-Year 2026 Non-GAAP EPS
    $16.70 to $16.85
    high materiality
    High
    Full-Year 2026 Operating Cash Flow
    approximately $3 billion
    medium materiality
    High
    Software and Services Revenue Growth
    10% to 11%
    medium materiality
    High
    Products and SI Revenue Growth
    7% to 8%
    medium materiality
    High
    Video Revenue Growth
    10% to 11%
    medium materiality
    High
    Command Center Revenue Growth
    15%
    medium materiality
    High
    MCN Revenue Growth
    7% to 8%
    medium materiality
    High
    Silvus Revenue
    $675 million
    high materiality
    High
    Operating Margin Expansion
    100 basis points
    high materiality
    High
    Product Orders Growth
    double-digit growth
    medium materiality
    High
    Product Orders Growth
    double-digit growth
    medium materiality
    High
    Product Backlog
    likely up
    medium materiality
    Medium
    APX NEXT Subscribers
    300,000 users
    medium materiality
    High

    Segment performance

    8
    SegmentRevenueYoYQoQMargin
    Products and SI
    Q4 sales growth driven by MCN and Video, with improved operating leverage partially offset by higher tariffs.
    Operating earnings: $667 millionAcquisition revenue: $151 millionFX impact: $20 million favorableMCN growth: 11%Video growth: 12%
    		Up 11%11%—30.9% of sales
    Products and SI (Full Year)
    Full year revenue growth driven by higher sales in MCN and Video, with improving gross margins.
    Operating earnings: $2.1 billionAcquisition revenue: $262 millionFX impact: $20 million favorable
    		$7.3 billion5%—28.9% of sales
    Software and Services
    Q4 revenue growth across all three technologies, with expanding margins inclusive of favorable mix and improved operating leverage.
    Operating earnings: $419 millionAcquisition revenue: $37 millionFX impact: $10 million favorable
    		Up 15%15%—34.3% of sales
    Software and Services (Full Year)
    Full year revenue growth driven by strong performance in all three technologies, with expanding margins and improved operating leverage.
    Operating earnings: $1.4 billionAcquisition revenue: $120 millionFX impact: $15 million favorable
    		$4.4 billion13%—32.5% of sales
    North America
    Q4 revenue growth driven by both segments and all three technologies.
    		$2.4 billion7%——
    North America (Full Year)
    Full year revenue growth driven by both segments and all three technologies.
    		$8.4 billion7%——
    International
    Q4 revenue growth with strong double-digit growth in both segments and all three technologies.
    		$1 billion26%——
    International (Full Year)
    Full year revenue growth in both segments and double-digit growth in all three technologies.
    		$3.3 billion11%——

    Operational metrics

    35
    Non-GAAP Operating Earnings
    $1.1 billionUp 19%
    Q4 FY25

    Record non-GAAP operating earnings for the quarter.

    Non-GAAP Operating Margin
    32.1%Up 170 bps
    Q4 FY25

    Record non-GAAP operating margin for the quarter.

    GAAP Operating Earnings
    $944 millionUp from 27% of sales
    Q4 FY25

    GAAP operating earnings for the quarter.

    GAAP EPS
    $3.86Up from $3.56
    Q4 FY25

    GAAP earnings per share for the quarter.

    Non-GAAP EPS
    $4.59Up 14% from $4.04
    Q4 FY25

    Non-GAAP earnings per share for the quarter.

    OpEx
    $700 millionUp $48 million
    Q4 FY25

    Operating expenses for the quarter, primarily due to acquisitions.

    Effective Tax Rate
    23.6%Compared to 22%
    Q4 FY25

    Effective tax rate for the quarter, driven by lower benefits from share-based compensation.

    Full Year Revenue
    $11.7 billionUp 8%
    FY25

    Full year revenue for 2025.

    Full Year GAAP Operating Earnings
    $3 billionUp from 24.8% of sales
    FY25

    Full year GAAP operating earnings for 2025.

    Full Year Non-GAAP Operating Earnings
    $3.5 billionUp $395 million
    FY25

    Full year non-GAAP operating earnings for 2025.

    Full Year Non-GAAP Operating Margin
    30.3%Up from 29%
    FY25

    Record full year non-GAAP operating margin for 2025.

    Full Year GAAP EPS
    $12.75Up 38% compared to $9.23
    FY25

    Full year GAAP EPS for 2025, primarily driven by a prior year loss related to Silver Lake notes settlement.

    Full Year Non-GAAP EPS
    $15.38Up 11% from $13.84
    FY25

    Full year non-GAAP EPS for 2025, driven by higher earnings and lower diluted share count.

    Full Year OpEx
    $2.6 billionUp $140 million
    FY25

    Full year operating expenses for 2025, driven by acquisitions and organic investments.

    Full Year Effective Tax Rate
    22.3%Compared to 22%
    FY25

    Full year effective tax rate for 2025.

    Capital Allocation for Acquisitions
    $4.9 billion
    FY25

    Amount allocated for acquisitions in 2025, including Silvus.

    Share Repurchases
    $1.2 billion
    FY25

    Amount spent on share repurchases in 2025.

    Share Repurchases
    $490 million
    Q4 FY25

    Amount spent on share repurchases in the fourth quarter.

    Cash Dividends
    $728 million
    FY25

    Amount paid in cash dividends in 2025.

    CapEx
    $265 million
    FY25

    Capital expenditures for 2025.

    Dividend Increase
    11%
    FY25

    Board of Directors approved an 11% increase in the dividend.

    Long-Term Senior Notes Issued
    $2 billion
    FY25

    Issued to fund the Silvus acquisition.

    Term Loans Issued
    $1.5 billion
    FY25

    Issued to fund the Silvus acquisition.

    Senior Debt Repaid
    $322 million
    FY25

    Senior debt repaid during 2025.

    Term Loan Repaid
    $200 million
    Subsequent to FY25 year-end

    Repayment of term loan subsequent to year-end, leaving a remaining balance.

    Tariff Headwind
    $60 million
    H1 FY26

    Incremental tariff headwind expected in the first half of 2026.

    Memory Cost
    Less than $50 million
    Annual

    Memory costs are expected to increase but are not a significant input for the company.

    APX NEXT Subscribers
    200,000+
    End of FY25

    Number of APX NEXT subscribers at the end of 2025, paying $300 annually for app services.

    SVX Devices Shipped
    15,000+
    Since launch

    Number of SVX body-worn assistant devices shipped since their launch.

    Cybersecurity Managed Detection and Response Customer Growth
    77%YoY
    YoY

    Year-over-year customer growth in the managed detection and response platform for cybersecurity.

    Cybersecurity Transactions Processed Daily
    1 billion
    Daily

    Number of security transactions processed daily, with 99% handled automatically by AI.

    Police Report Writing Time Reduction
    1 hour to 15 minutes
    N/A

    Time reduction for writing police reports using Narrative Assist.

    Mobile Video Redaction Time Reduction
    35 hours to 1 hour
    N/A

    Time reduction for redacting mobile video footage using AI.

    PSAP CAD Market Share
    Almost 2/3
    Current

    Motorola Solutions' market share in Computer-Aided Dispatch (CAD) systems within Public Safety Answering Points (PSAPs).

    Q4 Product Orders
    $2.4 billionUp $500 million
    Q4 FY25

    Record product orders for the fourth quarter.

    Industry KPIs

    8
    MetricValueDetails
    Capital return$1.2 billionUSD
    Backlog order book$15.7 billionUSD
    Orders backlog quality3 consecutive quartersquarters
    Product orders order growthUp 26%%
    Segment growth margin targets—
    Recurring software service revenue$4.4 billionUSD
    Revenue mix by product customer type—
    Design wins product cycle transitions—

    Orderbook & backlog

    4
    Total Backlog$15.7 billionQ4 FY25

    Up $1 billion YoY, Up $1.2 billion sequentially

    All-time record ending backlog.

    Products and SI Backlog$3.8 billionQ4 FY25

    Down $323 million YoY (8%)

    Driven by strong LMR shipments in the first half, returning to quick-turn rhythm.

    Software and Services BacklogUp $1.4 billion YoYQ4 FY25

    Up $945 million sequentially

    Strong growth across all three technologies.

    Product Orders$2.4 billionQ4 FY25

    Up $500 million YoY

    Record product orders for the quarter, contributing to strong demand indicators.

    Product announcements

    4
    ProductTypeDetails
    Assist Suites (Dispatcher Assist Suite, Responder Assist Suite)launch
    SVX body-worn assistantlaunch
    D-Series Mission Critical infrastructureupdate
    APX NEXT radios, applications, and back-end digital evidence management platformmilestone

    Deals & partnerships

    2
    Silvus Technologiesacquisition

    Acquisition closed in August 2025, getting the company into the rapidly growing new defense and unmanned systems market.

    Multiple (unnamed)acquisitions

    Strengthened portfolio in cloud-native 911 solutions, AI-driven workflows, and remote video monitoring through acquisitions.

    Risks & headwinds

    3
    Tariff HeadwindH1 FY26

    $60 million

    Mitigation: Mitigated by continued customer adoption of feature-rich devices, mix to higher growth parts of the portfolio, and prudent cost management.

    Memory Cost IncreasesFY26

    Less than $50 million annually

    Mitigation: Working with vendors, adding vendors, leaning on public safety critical status, inventory management, and surgical price increases.

    Seasonal Decline in Q1Q1 FY26

    Above-seasonal decline sequentially relative to past couple of years (analyst observation)

    Mitigation: Management states the decline is within expected pre-COVID seasonal patterns and is offset by strong product orders and full-year outlook.

    Q&A highlights

    7

    Update on Silvus' performance and potential for upward bias given unmanned systems demand, and how recent FedRAMP certifications and SVX/APX NEXT traction are impacting growth in the federal segment.

    Silvus has performed exceptionally well since acquisition, with 2026 revenue expectations raised to $675 million due to international and unmanned systems demand. FedRAMP approvals for SVX and APX NEXT, along with strong interest and shipments of SVX devices, are significantly enhancing the company's position and addressable market in the federal space, moving beyond traditional state and local focus.

    “We're raising our expectations again for revenue this year in 2026. We expect Silvus' revenue of $675 million in 2026. That's $75 million higher from expectations a quarter ago, and it continues to be a critical litmus test in Ukraine for critical defense -- new defense technology in unmanned.”

    asked by Tim Long · answered by Gregory Brown

    2 min read5 chapters

    Detailed Narrative

    01

    Silvus Acquisition Performance and Outlook

    The Silvus acquisition, closed in August, has exceeded expectations, with Q4 performance driven by strong demand from Ukraine and unmanned systems. Management is increasing R&D and go-to-market investments, improving coverage, and integrating procurement and supply chain functions. Silvus's revenue for 2026 is now expected to be $675 million, a $75 million increase from prior expectations, highlighting its critical role in new defense technology and unmanned systems.

    02

    AI Assist Suites and Public Safety Innovation

    Motorola Solutions launched its first AI Assist Suites for 911 dispatchers and first responders, designed to improve efficiency and situational awareness. These suites integrate AI-powered applications to synthesize multi-source data, reducing tasks like police report writing from an hour to 15 minutes and video redaction from 35 hours to 1 hour. The company plans to introduce more Assist Suites for additional personas, leveraging its broad public safety ecosystem and role-based pricing model of $99 per user per month.

    03

    Federal Market Expansion and Product Certifications

    The company is expanding its presence in the federal market, bolstered by FedRAMP approval for its APX NEXT radios, associated applications, and the back-end digital evidence management platform. This certification strengthens its position by meeting high security standards for cloud-based solutions. The SVX body-worn assistant, which converges secure voice, video, and AI, has shipped over 15,000 units and is seeing strong interest, further enhancing the federal opportunity.

    04

    LMR Product Refresh and Consistent Demand

    The LMR business is experiencing consistent and durable demand, driven by APX NEXT applications, the SVX body-worn assistant, and the D-Series mission-critical P25 LMR infrastructure. The company has seen three consecutive quarters of double-digit product order growth, with expectations for this trend to continue in Q1 and for the full year 2026. This indicates a return to a quick-turn model, with over half of last year's revenues being quick-turn sales.

    05

    Capital Allocation and Financial Strength

    Motorola Solutions deployed nearly $5 billion in strategic acquisitions in 2025, including Silvus, while also returning almost $2 billion to shareholders through dividends and share repurchases. The company's robust liquidity profile, strong cash flow generation, and solid balance sheet provide significant flexibility for future capital allocation, including M&A and continued share repurchases, supporting its growth strategy.

    AI-generated summary of the company’s earnings call. Not investment advice.