- Revenue Growth & Margin Expansion: Q2 revenue rose 5% YoY, with software/services up 15%, while operating margins expanded 80 bps, driving $141M in operating earnings.
- Backlog Surge: Total backlog reached $14.1B, including $10.7B in software/services, up 27% YoY in orders, reflecting strong demand across all segments.
- Silvus Integration: Acquisition to add $185M in 2025 revenue, with $0.20 EPS accretion in 2026, targeting 20% growth in unmanned systems, a $3B TAM expanding to $6B in 4 years.
- Video Software Expansion: Video revenue grew 25% Q2, expected to rise 10–12% in 2025, supported by AI-driven solutions and a 10%+ growth in fixed video business.
- LEO Satellite Integration: Partnerships with LEO providers aim to enhance high-bandwidth connectivity, creating new revenue streams for law enforcement and military markets.
Strong Demand Across the Business
Motorola Solutions saw strong demand across all areas of the business, with record Q2 orders up 27% year-over-year. The company's backlog grew to $14.1 billion, with software and services backlog reaching an all-time high of $10.7 billion. As CEO Greg Brown stated, "We're pleased with our progress and expect to continue to invest in solutions that provide sustainable long-term growth."
Segment Performance
In the products and systems integration segment, revenue was flat year-over-year, but operating earnings were comparable to the prior year. Notable wins included an $82 million P25 system upgrade for Tri-County systems and a $30 million P25 device order for the city of Miami, Florida. In software and services, revenue grew 15% year-over-year, driven by strong growth across all three technologies. Notable highlights included a $44 million command center order for a U.S. state and local customer and a $29 million P25 system upgrade and LMR services order for the city of Chicago.
Silvus Acquisition and Growth Opportunities
The company's acquisition of Silvus is expected to contribute $185 million of revenue in 2025 and be slightly dilutive to EPS in Q3. Silvus will be reported under the products and systems integration segment, and the company expects the business to grow mid-single digits in 2025. Silvus is expected to grow 20% in 2026 and be at least $0.20 accretive.
Valuation
With a P/E Ratio of 36.99, P/B Ratio of 46.11, and EV/EBITDA of 24.79, Motorola Solutions' valuation appears to be reflecting the company's strong growth prospects. The company's ROIC of 21.74% and ROE of 149.56% also suggest a strong return on investment. With a dividend yield of 0.94% and free cash flow yield of 3.01%, investors may be rewarded with both capital appreciation and income generation.