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x
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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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¨
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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DELAWARE
(State of Incorporation)
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36-1115800
(I.R.S. Employer Identification No.)
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500 W. Monroe Street,
Chicago, Illinois
(Address of principal executive offices)
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60661
(Zip Code)
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Large accelerated filer
x
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Accelerated filer
¨
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Non-accelerated filer
¨
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Smaller reporting company
¨
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Emerging growth company
¨
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(Do not check if a smaller reporting company)
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Class
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Number of Shares
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Common Stock; $.01 Par Value
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162,653,552
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Page
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Item 1 Financial Statements
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Condensed Consolidated Statements of Operations (Unaudited) for the Three and Six Months Ended July 1, 2017 and July 2, 2016
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Condensed Consolidated Statements of Comprehensive Income (Unaudited) for the Three and Six Months Ended July 1, 2017 and July 2, 2016
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Condensed Consolidated Balance Sheets as of July 1, 2017 (Unaudited) and December 31, 2016
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Condensed Consolidated Statement of Stockholders’ Equity (Unaudited) for the Six Months Ended July 1, 2017
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Condensed Consolidated Statements of Cash Flows (Unaudited) for the Six Months Ended July 1, 2017 and July 2, 2016
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Notes to Condensed Consolidated Financial Statements (Unaudited)
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Item 4
Mine Safety Disclosures
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Three Months Ended
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Six Months Ended
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||||||||||||
(In millions, except per share amounts)
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July 1,
2017 |
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July 2,
2016 |
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July 1,
2017 |
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July 2,
2016 |
||||||||
Net sales from products
|
$
|
848
|
|
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$
|
801
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|
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$
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1,551
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|
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$
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1,503
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Net sales from services
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649
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|
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629
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|
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1,226
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|
|
1,120
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||||
Net sales
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1,497
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1,430
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2,777
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|
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2,623
|
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||||
Costs of products sales
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392
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|
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361
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|
|
739
|
|
|
726
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||||
Costs of services sales
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415
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|
|
393
|
|
|
778
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|
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718
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|
||||
Costs of sales
|
807
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|
|
754
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|
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1,517
|
|
|
1,444
|
|
||||
Gross margin
|
690
|
|
|
676
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|
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1,260
|
|
|
1,179
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|
||||
Selling, general and administrative expenses
|
242
|
|
|
240
|
|
|
475
|
|
|
475
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|
||||
Research and development expenditures
|
138
|
|
|
138
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|
|
273
|
|
|
274
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|
||||
Other charges
|
53
|
|
|
74
|
|
|
79
|
|
|
107
|
|
||||
Operating earnings
|
257
|
|
|
224
|
|
|
433
|
|
|
323
|
|
||||
Other income (expense):
|
|
|
|
|
|
|
|
||||||||
Interest expense, net
|
(51
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)
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(54
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)
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(102
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)
|
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(103
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)
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||||
Gains (losses) on sales of investments and businesses, net
|
(1
|
)
|
|
1
|
|
|
2
|
|
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(20
|
)
|
||||
Other
|
—
|
|
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(4
|
)
|
|
(9
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)
|
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(11
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)
|
||||
Total other expense
|
(52
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)
|
|
(57
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)
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(109
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)
|
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(134
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)
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||||
Net earnings before income taxes
|
205
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|
|
167
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|
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324
|
|
|
189
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|
||||
Income tax expense
|
73
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|
|
59
|
|
|
114
|
|
|
64
|
|
||||
Net earnings
|
132
|
|
|
108
|
|
|
210
|
|
|
125
|
|
||||
Less: Earnings attributable to noncontrolling interests
|
1
|
|
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1
|
|
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2
|
|
|
1
|
|
||||
Net earnings attributable to Motorola Solutions, Inc.
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$
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131
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$
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107
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$
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208
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|
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$
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124
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Earnings per common share:
|
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||||||||
Basic
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$
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0.80
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$
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0.62
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$
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1.27
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$
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0.72
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Diluted
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$
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0.78
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$
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0.61
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|
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$
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1.23
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$
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0.71
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|
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|
|
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||||||||
Weighted average common shares outstanding:
|
|
|
|
|
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||||||||
Basic
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163.1
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171.9
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163.7
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173.0
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|
||||
Diluted
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169.0
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174.8
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169.5
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|
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175.7
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|
||||
Dividends declared per share
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$
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0.47
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$
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0.41
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$
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0.94
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$
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0.82
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Three Months Ended
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||||||
(In millions)
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July 1,
2017 |
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July 2,
2016 |
||||
Net earnings
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$
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132
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$
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108
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Other comprehensive income (loss), net of tax (Note 2):
|
|
|
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||||
Foreign currency translation adjustments
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47
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|
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(98
|
)
|
||
Marketable securities
|
4
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|
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(1
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)
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||
Defined benefit plans
|
14
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|
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56
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|
||
Total other comprehensive income (loss), net of tax
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65
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|
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(43
|
)
|
||
Comprehensive income
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197
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|
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65
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Less: Earnings attributable to noncontrolling interest
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1
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|
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1
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Comprehensive income attributable to Motorola Solutions, Inc. common shareholders
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$
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196
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$
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64
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|
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Six Months Ended
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||||||
(In millions)
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July 1,
2017 |
|
July 2,
2016 |
||||
Net earnings
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$
|
210
|
|
|
$
|
125
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Other comprehensive income (loss), net of tax (Note 2):
|
|
|
|
||||
Foreign currency translation adjustments
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81
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|
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(85
|
)
|
||
Marketable securities
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4
|
|
|
3
|
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||
Defined benefit plans
|
33
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|
|
60
|
|
||
Total other comprehensive income (loss), net of tax
|
118
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|
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(22
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)
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||
Comprehensive income
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328
|
|
|
103
|
|
||
Less: Earnings attributable to noncontrolling interest
|
2
|
|
|
1
|
|
||
Comprehensive income attributable to Motorola Solutions, Inc. common shareholders
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$
|
326
|
|
|
$
|
102
|
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(In millions, except par value)
|
July 1,
2017 |
|
December 31,
2016 |
||||
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(Unaudited)
|
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|
||||
ASSETS
|
|||||||
Cash and cash equivalents
|
$
|
742
|
|
|
$
|
967
|
|
Restricted cash
|
63
|
|
|
63
|
|
||
Total cash and cash equivalents
|
805
|
|
|
1,030
|
|
||
Accounts receivable, net
|
1,211
|
|
|
1,410
|
|
||
Inventories, net
|
391
|
|
|
273
|
|
||
Other current assets
|
804
|
|
|
755
|
|
||
Total current assets
|
3,211
|
|
|
3,468
|
|
||
Property, plant and equipment, net
|
859
|
|
|
789
|
|
||
Investments
|
248
|
|
|
238
|
|
||
Deferred income taxes
|
2,160
|
|
|
2,219
|
|
||
Goodwill
|
749
|
|
|
728
|
|
||
Intangible assets
|
868
|
|
|
821
|
|
||
Other assets
|
200
|
|
|
200
|
|
||
Total assets
|
$
|
8,295
|
|
|
$
|
8,463
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LIABILITIES AND STOCKHOLDERS’ EQUITY
|
|||||||
Current portion of long-term debt
|
$
|
46
|
|
|
$
|
4
|
|
Accounts payable
|
440
|
|
|
553
|
|
||
Accrued liabilities
|
1,924
|
|
|
2,111
|
|
||
Total current liabilities
|
2,410
|
|
|
2,668
|
|
||
Long-term debt
|
4,421
|
|
|
4,392
|
|
||
Other liabilities
|
2,440
|
|
|
2,355
|
|
||
Stockholders’ Equity
|
|
|
|
||||
Preferred stock, $100 par value
|
—
|
|
|
—
|
|
||
Common stock, $.01 par value:
|
2
|
|
|
2
|
|
||
Authorized shares: 600.0
|
|
|
|
||||
Issued shares: 7/1/17—163.1; 12/31/16—165.5
|
|
|
|
||||
Outstanding shares: 7/1/17—162.7; 12/31/16—164.7
|
|
|
|
||||
Additional paid-in capital
|
264
|
|
|
203
|
|
||
Retained earnings
|
945
|
|
|
1,148
|
|
||
Accumulated other comprehensive loss
|
(2,199
|
)
|
|
(2,317
|
)
|
||
Total Motorola Solutions, Inc. stockholders’ equity (deficit)
|
(988
|
)
|
|
(964
|
)
|
||
Noncontrolling interests
|
12
|
|
|
12
|
|
||
Total stockholders’ equity (deficit)
|
(976
|
)
|
|
(952
|
)
|
||
Total liabilities and stockholders’ equity
|
$
|
8,295
|
|
|
$
|
8,463
|
|
(In millions)
|
Shares
|
|
Common Stock and Additional Paid-in Capital
|
|
Accumulated Other Comprehensive Income (Loss)
|
|
Retained
Earnings |
|
Noncontrolling
Interests |
|||||||||
Balance as of December 31, 2016
|
165.5
|
|
|
$
|
205
|
|
|
$
|
(2,317
|
)
|
|
$
|
1,148
|
|
|
$
|
12
|
|
Net earnings
|
|
|
|
|
|
|
|
|
|
208
|
|
|
2
|
|
||||
Other comprehensive income
|
|
|
|
|
|
|
118
|
|
|
|
|
|
|
|
||||
Issuance of common stock and stock options exercised
|
0.8
|
|
|
28
|
|
|
|
|
|
|
|
|
|
|
||||
Share repurchase program
|
(3.2
|
)
|
|
|
|
|
|
|
|
(258
|
)
|
|
|
|
||||
Share-based compensation expense
|
|
|
|
33
|
|
|
|
|
|
|
|
|
|
|
||||
Dividends declared
|
|
|
|
|
|
|
|
|
|
(153
|
)
|
|
(2
|
)
|
||||
Balance as of July 1, 2017
|
163.1
|
|
|
$
|
266
|
|
|
$
|
(2,199
|
)
|
|
$
|
945
|
|
|
$
|
12
|
|
|
Six Months Ended
|
||||||
(In millions)
|
July 1,
2017 |
|
July 2,
2016 |
||||
Operating
|
|
|
|
||||
Net earnings attributable to Motorola Solutions, Inc.
|
$
|
208
|
|
|
$
|
124
|
|
Earnings attributable to noncontrolling interests
|
2
|
|
|
1
|
|
||
Net earnings
|
210
|
|
|
125
|
|
||
Adjustments to reconcile Net earnings to Net cash provided by operating activities:
|
|
|
|
||||
Depreciation and amortization
|
166
|
|
|
144
|
|
||
Non-cash other charges
|
21
|
|
|
35
|
|
||
Non-U.S. pension settlement loss
|
25
|
|
|
—
|
|
||
Share-based compensation expense
|
33
|
|
|
35
|
|
||
Losses (gains) on sales of investments and businesses, net
|
(2
|
)
|
|
20
|
|
||
Deferred income taxes
|
63
|
|
|
71
|
|
||
Changes in assets and liabilities, net of effects of acquisitions, dispositions, and foreign currency translation adjustments:
|
|
|
|
||||
Accounts receivable
|
251
|
|
|
327
|
|
||
Inventories
|
(112
|
)
|
|
(2
|
)
|
||
Other current assets
|
(21
|
)
|
|
(65
|
)
|
||
Accounts payable and accrued liabilities
|
(340
|
)
|
|
(362
|
)
|
||
Other assets and liabilities
|
21
|
|
|
(24
|
)
|
||
Net cash provided by operating activities
|
315
|
|
|
304
|
|
||
Investing
|
|
|
|
||||
Acquisitions and investments, net
|
(140
|
)
|
|
(1,120
|
)
|
||
Proceeds from sales of investments and businesses, net
|
72
|
|
|
553
|
|
||
Capital expenditures
|
(121
|
)
|
|
(143
|
)
|
||
Proceeds from sales of property, plant and equipment
|
—
|
|
|
46
|
|
||
Net cash used for investing activities
|
(189
|
)
|
|
(664
|
)
|
||
Financing
|
|
|
|
||||
Repayment of debt
|
(6
|
)
|
|
(2
|
)
|
||
Net proceeds from issuance of debt
|
—
|
|
|
673
|
|
||
Proceeds from financing through capital leases
|
7
|
|
|
—
|
|
||
Issuance of common stock
|
28
|
|
|
40
|
|
||
Purchase of common stock
|
(258
|
)
|
|
(619
|
)
|
||
Payment of dividends
|
(154
|
)
|
|
(143
|
)
|
||
Payment of dividend to non-controlling interest
|
(2
|
)
|
|
—
|
|
||
Net cash used for financing activities
|
(385
|
)
|
|
(51
|
)
|
||
Effect of exchange rate changes on cash and cash equivalents
|
34
|
|
|
(24
|
)
|
||
Net decrease in cash and cash equivalents
|
(225
|
)
|
|
(435
|
)
|
||
Cash and cash equivalents, beginning of period
|
1,030
|
|
|
1,980
|
|
||
Cash and cash equivalents, end of period
|
$
|
805
|
|
|
$
|
1,545
|
|
Supplemental Cash Flow Information
|
|
|
|
||||
Cash paid during the period for:
|
|
|
|
||||
Interest, net
|
$
|
88
|
|
|
$
|
94
|
|
Income and withholding taxes, net of refunds
|
47
|
|
|
54
|
|
1.
|
Basis of Presentation
|
|
Three Months Ended
|
Six Months Ended
|
||||||||||||
|
July 1,
2017 |
|
July 2,
2016 |
July 1,
2017 |
|
July 2,
2016 |
||||||||
Other charges:
|
|
|
|
|
|
|
||||||||
Intangibles amortization
|
$
|
37
|
|
|
$
|
38
|
|
$
|
73
|
|
|
$
|
52
|
|
Reorganization of business
|
1
|
|
|
19
|
|
16
|
|
|
25
|
|
||||
Building impairment
|
—
|
|
|
17
|
|
8
|
|
|
17
|
|
||||
Non-U.S. pension settlement loss
|
16
|
|
|
—
|
|
25
|
|
|
—
|
|
||||
Legal settlements
|
(1
|
)
|
|
—
|
|
(44
|
)
|
|
—
|
|
||||
Acquisition-related transaction fees
|
—
|
|
|
—
|
|
1
|
|
|
13
|
|
||||
|
$
|
53
|
|
|
$
|
74
|
|
$
|
79
|
|
|
$
|
107
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
July 1,
2017 |
|
July 2,
2016 |
|
July 1,
2017 |
|
July 2,
2016 |
||||||||
Interest income (expense), net:
|
|
|
|
|
|
|
|
||||||||
Interest expense
|
$
|
(55
|
)
|
|
$
|
(59
|
)
|
|
$
|
(109
|
)
|
|
$
|
(111
|
)
|
Interest income
|
4
|
|
|
5
|
|
|
7
|
|
|
8
|
|
||||
|
$
|
(51
|
)
|
|
$
|
(54
|
)
|
|
$
|
(102
|
)
|
|
$
|
(103
|
)
|
Other:
|
|
|
|
|
|
|
|
||||||||
Foreign currency gain (loss)
|
$
|
(20
|
)
|
|
$
|
14
|
|
|
$
|
(22
|
)
|
|
$
|
27
|
|
Gain (loss) on derivative instruments
|
18
|
|
|
(18
|
)
|
|
11
|
|
|
(30
|
)
|
||||
Gains on equity method investments
|
1
|
|
|
—
|
|
|
—
|
|
|
2
|
|
||||
Realized foreign currency loss on acquisition
|
—
|
|
|
—
|
|
|
—
|
|
|
(10
|
)
|
||||
Other
|
1
|
|
|
—
|
|
|
2
|
|
|
—
|
|
||||
|
$
|
—
|
|
|
$
|
(4
|
)
|
|
$
|
(9
|
)
|
|
$
|
(11
|
)
|
|
Amounts attributable to Motorola Solutions, Inc. common stockholders
|
||||||||||||||
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
July 1,
2017 |
|
July 2,
2016 |
|
July 1,
2017 |
|
July 2,
2016 |
||||||||
Basic earnings per common share:
|
|
|
|
|
|
|
|
||||||||
Earnings
|
$
|
131
|
|
|
$
|
107
|
|
|
$
|
208
|
|
|
$
|
124
|
|
Weighted average common shares outstanding
|
163.1
|
|
|
171.9
|
|
|
163.7
|
|
|
173.0
|
|
||||
Per share amount
|
$
|
0.80
|
|
|
$
|
0.62
|
|
|
$
|
1.27
|
|
|
$
|
0.72
|
|
Diluted earnings per common share:
|
|
|
|
|
|
|
|
||||||||
Earnings
|
$
|
131
|
|
|
$
|
107
|
|
|
$
|
208
|
|
|
$
|
124
|
|
Weighted average common shares outstanding
|
163.1
|
|
|
171.9
|
|
|
163.7
|
|
|
173.0
|
|
||||
Add effect of dilutive securities:
|
|
|
|
|
|
|
|
||||||||
Share-based awards
|
3.1
|
|
|
2.4
|
|
|
3.2
|
|
|
2.4
|
|
||||
Senior Convertible Notes
|
2.8
|
|
|
0.5
|
|
|
2.6
|
|
|
0.3
|
|
||||
Diluted weighted average common shares outstanding
|
169.0
|
|
|
174.8
|
|
|
169.5
|
|
|
175.7
|
|
||||
Per share amount
|
$
|
0.78
|
|
|
$
|
0.61
|
|
|
$
|
1.23
|
|
|
$
|
0.71
|
|
|
July 1,
2017 |
|
December 31,
2016 |
||||
Accounts receivable
|
$
|
1,250
|
|
|
$
|
1,454
|
|
Less allowance for doubtful accounts
|
(39
|
)
|
|
(44
|
)
|
||
|
$
|
1,211
|
|
|
$
|
1,410
|
|
|
July 1,
2017 |
|
December 31,
2016 |
||||
Finished goods
|
$
|
197
|
|
|
$
|
151
|
|
Work-in-process and production materials
|
321
|
|
|
253
|
|
||
|
518
|
|
|
404
|
|
||
Less inventory reserves
|
(127
|
)
|
|
(131
|
)
|
||
|
$
|
391
|
|
|
$
|
273
|
|
|
July 1,
2017 |
|
December 31,
2016 |
||||
Available-for-sale securities
|
$
|
50
|
|
|
$
|
46
|
|
Costs and earnings in excess of billings
|
529
|
|
|
495
|
|
||
Tax-related refunds receivable
|
110
|
|
|
90
|
|
||
Other
|
115
|
|
|
124
|
|
||
|
$
|
804
|
|
|
$
|
755
|
|
|
July 1,
2017 |
|
December 31,
2016 |
||||
Land
|
$
|
10
|
|
|
$
|
12
|
|
Building
|
267
|
|
|
306
|
|
||
Machinery and equipment
|
2,078
|
|
|
1,921
|
|
||
|
2,355
|
|
|
2,239
|
|
||
Less accumulated depreciation
|
(1,496
|
)
|
|
(1,450
|
)
|
||
|
$
|
859
|
|
|
$
|
789
|
|
July 1, 2017
|
Cost
Basis |
|
Unrealized
Gains |
|
Investments
|
||||||
Available-for-sale securities:
|
|
|
|
|
|
||||||
Government, agency, and government-sponsored enterprise obligations
|
$
|
56
|
|
|
$
|
—
|
|
|
$
|
56
|
|
Corporate bonds
|
5
|
|
|
—
|
|
|
5
|
|
|||
Common stock
|
5
|
|
|
7
|
|
|
12
|
|
|||
|
66
|
|
|
7
|
|
|
73
|
|
|||
Other investments
|
210
|
|
|
—
|
|
|
210
|
|
|||
Equity method investments
|
15
|
|
|
—
|
|
|
15
|
|
|||
|
$
|
291
|
|
|
$
|
7
|
|
|
$
|
298
|
|
Less: current portion of available-for-sale securities
|
|
|
|
|
50
|
|
|||||
|
|
|
|
|
$
|
248
|
|
December 31, 2016
|
Cost
Basis |
|
Unrealized
Gains |
|
Investments
|
||||||
Available-for-sale securities:
|
|
|
|
|
|
||||||
Government, agency, and government-sponsored enterprise obligations
|
$
|
51
|
|
|
$
|
—
|
|
|
$
|
51
|
|
Corporate bonds
|
5
|
|
|
—
|
|
|
5
|
|
|||
|
56
|
|
|
—
|
|
|
56
|
|
|||
Other investments
|
211
|
|
|
—
|
|
|
211
|
|
|||
Equity method investments
|
17
|
|
|
—
|
|
|
17
|
|
|||
|
$
|
284
|
|
|
$
|
—
|
|
|
$
|
284
|
|
Less: current portion of available-for-sale securities
|
|
|
|
|
46
|
|
|||||
|
|
|
|
|
$
|
238
|
|
|
July 1,
2017 |
|
December 31,
2016 |
|||
Long-term receivables
|
35
|
|
|
49
|
|
|
Defined benefit plan assets
|
125
|
|
|
102
|
|
|
Other
|
40
|
|
|
49
|
|
|
|
$
|
200
|
|
|
200
|
|
|
July 1,
2017 |
|
December 31,
2016 |
||||
Deferred revenue
|
$
|
427
|
|
|
$
|
439
|
|
Compensation
|
171
|
|
|
250
|
|
||
Billings in excess of costs and earnings
|
387
|
|
|
434
|
|
||
Tax liabilities
|
134
|
|
|
111
|
|
||
Dividend payable
|
76
|
|
|
77
|
|
||
Trade liabilities
|
174
|
|
|
180
|
|
||
Other
|
555
|
|
|
620
|
|
||
|
$
|
1,924
|
|
|
$
|
2,111
|
|
|
July 1,
2017 |
|
December 31,
2016 |
||||
Defined benefit plans
|
$
|
1,800
|
|
|
$
|
1,799
|
|
Deferred revenue
|
164
|
|
|
115
|
|
||
Unrecognized tax benefits
|
39
|
|
|
39
|
|
||
Deferred income taxes
|
139
|
|
|
121
|
|
||
Deferred consideration (Note 13)
|
78
|
|
|
72
|
|
||
Other
|
220
|
|
|
209
|
|
||
|
$
|
2,440
|
|
|
$
|
2,355
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
July 1,
2017 |
|
July 2,
2016 |
|
July 1,
2017 |
|
July 2,
2016 |
||||||||
Foreign Currency Translation Adjustments:
|
|
|
|
|
|
|
|
||||||||
Balance at beginning of period
|
$
|
(460
|
)
|
|
$
|
(253
|
)
|
|
$
|
(494
|
)
|
|
$
|
(266
|
)
|
Other comprehensive income (loss) before reclassification adjustment
|
47
|
|
|
(98
|
)
|
|
84
|
|
|
(84
|
)
|
||||
Tax expense
|
—
|
|
|
—
|
|
|
(3
|
)
|
|
(1
|
)
|
||||
Other comprehensive income (loss), net of tax
|
47
|
|
|
(98
|
)
|
|
81
|
|
|
(85
|
)
|
||||
Balance at end of period
|
$
|
(413
|
)
|
|
$
|
(351
|
)
|
|
$
|
(413
|
)
|
|
$
|
(351
|
)
|
Available-for-Sale Securities:
|
|
|
|
|
|
|
|
||||||||
Balance at beginning of period
|
$
|
—
|
|
|
$
|
1
|
|
|
$
|
—
|
|
|
$
|
(3
|
)
|
Other comprehensive income (loss) before reclassification adjustment
|
7
|
|
|
(2
|
)
|
|
7
|
|
|
(2
|
)
|
||||
Tax (expense) benefit
|
(3
|
)
|
|
1
|
|
|
(3
|
)
|
|
1
|
|
||||
Other comprehensive income (loss) before reclassification adjustment, net of tax
|
4
|
|
|
(1
|
)
|
|
4
|
|
|
(1
|
)
|
||||
Reclassification adjustment into Gains (losses) on sales of investments and businesses, net
|
—
|
|
|
—
|
|
|
—
|
|
|
6
|
|
||||
Tax benefit
|
—
|
|
|
—
|
|
|
—
|
|
|
(2
|
)
|
||||
Reclassification adjustment into Gains (losses) on sales of investments and businesses, net of tax
|
—
|
|
|
—
|
|
|
—
|
|
|
4
|
|
||||
Other comprehensive income (loss), net of tax
|
4
|
|
|
(1
|
)
|
|
4
|
|
|
3
|
|
||||
Balance at end of period
|
$
|
4
|
|
|
$
|
—
|
|
|
$
|
4
|
|
|
$
|
—
|
|
Defined Benefit Plans:
|
|
|
|
|
|
|
|
||||||||
Balance at beginning of period
|
(1,804
|
)
|
|
(1,593
|
)
|
|
$
|
(1,823
|
)
|
|
$
|
(1,597
|
)
|
||
Other comprehensive income (loss) before reclassification adjustment
|
(11
|
)
|
|
53
|
|
|
(11
|
)
|
|
53
|
|
||||
Tax expense
|
—
|
|
|
(16
|
)
|
|
—
|
|
|
(16
|
)
|
||||
Other comprehensive income (loss) before reclassification adjustment, net of tax
|
(11
|
)
|
|
37
|
|
|
(11
|
)
|
|
37
|
|
||||
Reclassification adjustment - Actuarial net losses into Selling, general, and administrative expenses
|
16
|
|
|
18
|
|
|
32
|
|
|
28
|
|
||||
Reclassification adjustment - Prior service benefits into Selling, general, and administrative expenses
|
(4
|
)
|
|
(7
|
)
|
|
(8
|
)
|
|
(13
|
)
|
||||
Reclassification adjustment - Non-U.S. pension settlement loss into Other charges
|
16
|
|
|
—
|
|
|
25
|
|
|
—
|
|
||||
Tax expense (benefit)
|
(3
|
)
|
|
8
|
|
|
(5
|
)
|
|
8
|
|
||||
Reclassification adjustment into Operating earnings, net of tax
|
25
|
|
|
19
|
|
|
44
|
|
|
23
|
|
||||
Other comprehensive income, net of tax
|
14
|
|
|
56
|
|
|
33
|
|
|
60
|
|
||||
Balance at end of period
|
$
|
(1,790
|
)
|
|
$
|
(1,537
|
)
|
|
$
|
(1,790
|
)
|
|
$
|
(1,537
|
)
|
|
|
|
|
|
|
|
|
||||||||
Total Accumulated other comprehensive loss
|
$
|
(2,199
|
)
|
|
$
|
(1,888
|
)
|
|
$
|
(2,199
|
)
|
|
$
|
(1,888
|
)
|
|
Notional Amount
|
||||||
Net Buy (Sell) by Currency
|
July 1,
2017 |
|
December 31,
2016 |
||||
Euro
|
$
|
161
|
|
|
$
|
122
|
|
British Pound
|
149
|
|
|
246
|
|
||
Chinese Renminbi
|
(81
|
)
|
|
(108
|
)
|
||
Australian Dollar
|
(50
|
)
|
|
(51
|
)
|
||
Brazilian Real
|
(45
|
)
|
|
(56
|
)
|
|
Fair Values of Derivative Instruments
|
||||||||||
|
Assets
|
|
Liabilities
|
||||||||
July 1, 2017
|
Fair
Value
|
|
Balance
Sheet
Location
|
|
Fair
Value
|
|
Balance
Sheet
Location
|
||||
Derivatives designated as hedging instruments:
|
|
|
|
|
|
|
|
||||
Foreign exchange contracts
|
$
|
—
|
|
|
Other assets
|
|
$
|
2
|
|
|
Other liabilities
|
Derivatives not designated as hedging instruments:
|
|
|
|
|
|
|
|
||||
Foreign exchange contracts
|
$
|
6
|
|
|
Other current assets
|
|
$
|
4
|
|
|
Accrued liabilities
|
Total derivatives
|
$
|
6
|
|
|
|
|
$
|
6
|
|
|
|
|
Fair Values of Derivative Instruments
|
||||||||||
|
Assets
|
|
Liabilities
|
||||||||
December 31, 2016
|
Fair
Value
|
|
Balance
Sheet
Location
|
|
Fair
Value
|
|
Balance
Sheet
Location
|
||||
Derivatives not designated as hedging instruments:
|
|
|
|
|
|
|
|
||||
Foreign exchange contracts
|
$
|
9
|
|
|
Other current assets
|
|
$
|
32
|
|
|
Accrued liabilities
|
|
Three Months Ended
|
|
Six Months Ended
|
|
Balance Sheet
Location
|
||||||||||||
Derivatives Designated as Hedging Instruments
|
July 1,
2017 |
|
July 2,
2016 |
|
July 1,
2017 |
|
July 2,
2016 |
|
|||||||||
Foreign exchange contracts
|
$
|
(2
|
)
|
|
$
|
—
|
|
|
$
|
(2
|
)
|
|
$
|
—
|
|
|
Other comprehensive income (loss)
|
|
Three Months Ended
|
|
Six Months Ended
|
|
Statements of
Operations Location
|
||||||||
Gain (loss) on Derivative Instruments
|
July 1,
2017 |
|
July 2,
2016 |
|
July 1,
2017 |
|
July 2,
2016 |
|
|||||
Foreign exchange contracts
|
18
|
|
|
(18
|
)
|
|
11
|
|
|
(30
|
)
|
|
Other income (expense)
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
July 1,
2017 |
|
July 2,
2016 |
|
July 1,
2017 |
|
July 2,
2016 |
||||||||
Net earnings before income taxes
|
$
|
205
|
|
|
$
|
167
|
|
|
$
|
324
|
|
|
$
|
189
|
|
Income tax expense
|
73
|
|
|
59
|
|
|
114
|
|
|
64
|
|
||||
Effective tax rate
|
36
|
%
|
|
35
|
%
|
|
35
|
%
|
|
34
|
%
|
|
U.S. Pension Benefit Plans
|
|
Non U.S. Pension Benefit Plans
|
|
Postretirement Health Care Benefits Plan
|
||||||||||||||||||
Three Months Ended
|
July 1, 2017
|
|
July 2, 2016
|
|
July 1, 2017
|
|
July 2, 2016
|
|
July 1, 2017
|
|
July 2, 2016
|
||||||||||||
Service cost
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1
|
|
|
$
|
2
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Interest cost
|
46
|
|
|
46
|
|
|
10
|
|
|
14
|
|
|
1
|
|
|
1
|
|
||||||
Expected return on plan assets
|
(57
|
)
|
|
(55
|
)
|
|
(24
|
)
|
|
(24
|
)
|
|
(3
|
)
|
|
(3
|
)
|
||||||
Amortization of:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Unrecognized net loss
|
11
|
|
|
9
|
|
|
4
|
|
|
3
|
|
|
1
|
|
|
2
|
|
||||||
Unrecognized prior service benefit
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(4
|
)
|
|
(7
|
)
|
||||||
Settlement loss
|
—
|
|
|
—
|
|
|
16
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Net periodic pension cost (benefit)
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
7
|
|
|
$
|
(5
|
)
|
|
$
|
(5
|
)
|
|
$
|
(7
|
)
|
|
U.S. Pension Benefit Plans
|
|
Non U.S. Pension Benefit Plans
|
|
Postretirement Health Care Benefits Plan
|
||||||||||||||||||
Six Months Ended
|
July 1, 2017
|
|
July 2, 2016
|
|
July 1, 2017
|
|
July 2, 2016
|
|
July 1, 2017
|
|
July 2, 2016
|
||||||||||||
Service cost
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
2
|
|
|
$
|
4
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Interest cost
|
92
|
|
|
91
|
|
|
20
|
|
|
28
|
|
|
2
|
|
|
2
|
|
||||||
Expected return on plan assets
|
(115
|
)
|
|
(110
|
)
|
|
(47
|
)
|
|
(48
|
)
|
|
(6
|
)
|
|
(5
|
)
|
||||||
Amortization of:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Unrecognized net loss
|
22
|
|
|
19
|
|
|
8
|
|
|
6
|
|
|
2
|
|
|
3
|
|
||||||
Unrecognized prior service benefit
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(8
|
)
|
|
(13
|
)
|
||||||
Settlement loss
|
—
|
|
|
—
|
|
|
25
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Net periodic cost (benefit)
|
$
|
(1
|
)
|
|
$
|
—
|
|
|
$
|
8
|
|
|
$
|
(10
|
)
|
|
$
|
(10
|
)
|
|
$
|
(13
|
)
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
July 1,
2017 |
|
July 2,
2016 |
|
July 1,
2017 |
|
July 2,
2016 |
||||||||
Share-based compensation expense included in:
|
|
|
|
|
|
|
|
||||||||
Costs of sales
|
$
|
2
|
|
|
$
|
2
|
|
|
$
|
4
|
|
|
$
|
4
|
|
Selling, general and administrative expenses
|
11
|
|
|
12
|
|
|
22
|
|
|
24
|
|
||||
Research and development expenditures
|
3
|
|
|
4
|
|
|
7
|
|
|
7
|
|
||||
Share-based compensation expense included in Operating earnings
|
16
|
|
|
18
|
|
|
33
|
|
|
35
|
|
||||
Tax benefit
|
5
|
|
|
6
|
|
|
11
|
|
|
11
|
|
||||
Share-based compensation expense, net of tax
|
$
|
11
|
|
|
$
|
12
|
|
|
$
|
22
|
|
|
$
|
24
|
|
Decrease in basic earnings per share
|
$
|
(0.07
|
)
|
|
$
|
(0.07
|
)
|
|
$
|
(0.13
|
)
|
|
$
|
(0.14
|
)
|
Decrease in diluted earnings per share
|
$
|
(0.07
|
)
|
|
$
|
(0.07
|
)
|
|
$
|
(0.13
|
)
|
|
$
|
(0.14
|
)
|
July 1, 2017
|
Level 1
|
|
Level 2
|
|
Total
|
||||||
Assets:
|
|
|
|
|
|
||||||
Foreign exchange derivative contracts
|
$
|
—
|
|
|
$
|
6
|
|
|
$
|
6
|
|
Available-for-sale securities:
|
|
|
|
|
|
||||||
Government, agency, and government-sponsored enterprise obligations
|
$
|
—
|
|
|
$
|
56
|
|
|
$
|
56
|
|
Corporate bonds
|
—
|
|
|
5
|
|
|
5
|
|
|||
Common stock
|
12
|
|
|
—
|
|
|
12
|
|
|||
Liabilities:
|
|
|
|
|
|
||||||
Foreign exchange derivative contracts
|
$
|
—
|
|
|
$
|
6
|
|
|
$
|
6
|
|
December 31, 2016
|
Level 2
|
|
Total
|
||||
Assets:
|
|
|
|
||||
Foreign exchange derivative contracts
|
$
|
9
|
|
|
$
|
9
|
|
Available-for-sale securities:
|
|
|
|
||||
Government, agency, and government-sponsored enterprise obligations
|
51
|
|
|
51
|
|
||
Corporate bonds
|
5
|
|
|
5
|
|
||
Liabilities:
|
|
|
|
||||
Foreign exchange derivative contracts
|
$
|
32
|
|
|
$
|
32
|
|
|
July 1,
2017 |
|
December 31,
2016 |
||||
Long-term receivables
|
$
|
48
|
|
|
$
|
63
|
|
Less current portion
|
(13
|
)
|
|
(14
|
)
|
||
Non-current long-term receivables
|
$
|
35
|
|
|
$
|
49
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
July 1,
2017 |
|
July 2,
2016 |
|
July 1,
2017 |
|
July 2,
2016 |
||||||||
Accounts receivable sales proceeds
|
$
|
61
|
|
|
$
|
5
|
|
|
$
|
80
|
|
|
$
|
7
|
|
Long-term receivables sales proceeds
|
22
|
|
|
70
|
|
|
68
|
|
|
134
|
|
||||
Total proceeds from receivable sales
|
$
|
83
|
|
|
$
|
75
|
|
|
$
|
148
|
|
|
$
|
141
|
|
July 1, 2017
|
Total
Long-term
Receivable
|
|
Current Billed
Due
|
|
Past Due Over 90 Days
|
||||||
Municipal leases secured tax exempt
|
$
|
21
|
|
|
$
|
1
|
|
|
$
|
2
|
|
Commercial loans and leases secured
|
27
|
|
|
—
|
|
|
—
|
|
|||
Long-term receivables, including current portion
|
$
|
48
|
|
|
$
|
1
|
|
|
$
|
2
|
|
December 31, 2016
|
Total
Long-term
Receivable
|
|
Current Billed
Due
|
|
Past Due Over 90 Days
|
||||||
Municipal leases secured tax exempt
|
$
|
20
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Commercial loans and leases secured
|
43
|
|
|
—
|
|
|
2
|
|
|||
Long-term receivables, including current portion
|
$
|
63
|
|
|
$
|
—
|
|
|
$
|
2
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
July 1,
2017 |
|
July 2,
2016 |
|
July 1,
2017 |
|
July 2,
2016 |
||||||||
Products
|
$
|
848
|
|
|
$
|
801
|
|
|
$
|
1,551
|
|
|
$
|
1,503
|
|
Services
|
649
|
|
|
629
|
|
|
1,226
|
|
|
1,120
|
|
||||
|
$
|
1,497
|
|
|
$
|
1,430
|
|
|
$
|
2,777
|
|
|
$
|
2,623
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
July 1,
2017 |
|
July 2,
2016 |
|
July 1,
2017 |
|
July 2,
2016 |
||||||||
Products
|
$
|
168
|
|
|
$
|
129
|
|
|
$
|
257
|
|
|
$
|
179
|
|
Services
|
89
|
|
|
95
|
|
|
176
|
|
|
144
|
|
||||
Operating earnings
|
257
|
|
|
224
|
|
|
433
|
|
|
323
|
|
||||
Total other expense
|
(52
|
)
|
|
(57
|
)
|
|
(109
|
)
|
|
(134
|
)
|
||||
Earnings before income taxes
|
$
|
205
|
|
|
$
|
167
|
|
|
$
|
324
|
|
|
$
|
189
|
|
July 1, 2017
|
Three Months Ended
|
|
Six Months Ended
|
||||
Products
|
$
|
3
|
|
|
$
|
16
|
|
Services
|
—
|
|
|
6
|
|
||
|
$
|
3
|
|
|
$
|
22
|
|
|
January 1, 2017
|
|
Additional
Charges
|
|
Adjustments
|
|
Amount
Used
|
|
July 1, 2017
|
||||||||||
Exit costs
|
$
|
7
|
|
|
$
|
4
|
|
|
$
|
—
|
|
|
$
|
(1
|
)
|
|
$
|
10
|
|
Employee separation costs
|
95
|
|
|
23
|
|
|
(5
|
)
|
|
(55
|
)
|
|
58
|
|
|||||
|
$
|
102
|
|
|
$
|
27
|
|
|
$
|
(5
|
)
|
|
$
|
(56
|
)
|
|
$
|
68
|
|
July 2, 2016
|
Three Months Ended
|
|
Six Months Ended
|
||||
Products
|
$
|
33
|
|
|
$
|
54
|
|
Services
|
11
|
|
|
13
|
|
||
|
$
|
44
|
|
|
$
|
67
|
|
Cash
|
|
$
|
86
|
|
Accounts receivable, net
|
|
55
|
|
|
Other current assets
|
|
36
|
|
|
Property, plant and equipment, net
|
|
245
|
|
|
Deferred income taxes
|
|
82
|
|
|
Accounts payable
|
|
(18
|
)
|
|
Accrued liabilities
|
|
(181
|
)
|
|
Other liabilities
|
|
(289
|
)
|
|
Goodwill
|
|
191
|
|
|
Intangible assets
|
|
875
|
|
|
Total consideration
|
|
$
|
1,082
|
|
Net present value of deferred consideration payment to former owners
|
|
(82
|
)
|
|
Net cash consideration at purchase
|
|
$
|
1,000
|
|
|
July 1, 2017
|
|
December 31, 2016
|
||||||||||||
|
Gross
Carrying
Amount
|
|
Accumulated
Amortization
|
|
Gross
Carrying
Amount
|
|
Accumulated
Amortization
|
||||||||
Completed technology
|
$
|
128
|
|
|
$
|
46
|
|
|
$
|
116
|
|
|
$
|
38
|
|
Patents
|
8
|
|
|
7
|
|
|
8
|
|
|
6
|
|
||||
Customer-related
|
918
|
|
|
167
|
|
|
810
|
|
|
101
|
|
||||
Other intangibles
|
54
|
|
|
20
|
|
|
49
|
|
|
17
|
|
||||
|
$
|
1,108
|
|
|
$
|
240
|
|
|
$
|
983
|
|
|
$
|
162
|
|
|
July 1, 2017
|
|
December 31, 2016
|
||||||||||||
|
Gross
Carrying Amount |
|
Accumulated
Amortization |
|
Gross
Carrying Amount |
|
Accumulated
Amortization |
||||||||
Products
|
$
|
178
|
|
|
$
|
73
|
|
|
$
|
178
|
|
|
$
|
63
|
|
Services
|
930
|
|
|
167
|
|
|
805
|
|
|
99
|
|
||||
|
$
|
1,108
|
|
|
$
|
240
|
|
|
$
|
983
|
|
|
$
|
162
|
|
|
Products
|
|
Services
|
|
Total
|
||||||
Balance as of January 1, 2017
|
|
|
|
|
|
||||||
Goodwill, net of impairment losses
|
$
|
316
|
|
|
$
|
412
|
|
|
$
|
728
|
|
Goodwill acquired
|
—
|
|
|
7
|
|
|
7
|
|
|||
Purchase accounting adjustments
|
1
|
|
|
3
|
|
|
4
|
|
|||
Foreign currency
|
—
|
|
|
10
|
|
|
10
|
|
|||
Balance as of July 1, 2017
|
|
|
|
|
|
||||||
Goodwill, net of impairment losses
|
$
|
317
|
|
|
$
|
432
|
|
|
$
|
749
|
|
•
|
Net sales were
$1.5 billion
in the
second
quarter of
2017
,
up
$67 million
, or
5%
, from the
second
quarter of
2016
.
|
•
|
We generated operating earnings of
$257 million
, or
17%
of net sales, in the
second
quarter of
2017
, compared to
$224 million
, or
16%
of net sales, in the
second
quarter of
2016
. Profitability
increased
as a result of higher revenue in both the Products and Services segments and lower Other charges.
|
•
|
We had net earnings attributable to Motorola Solutions, Inc. of
$131 million
, or
$0.78
per diluted common share, in the
second
quarter of
2017
, compared to
$107 million
, or
$0.61
per diluted common share, in the
second
quarter of
2016
.
|
•
|
We generated net cash from operating activities of
$315 million
during the
first half
of
2017
, compared to
$304 million
in the
first half
of
2016
.
|
•
|
We returned
$412 million
in capital to shareholders through dividends and share repurchases during the
first half
of
2017
.
|
•
|
Products:
Net sales were
$848 million
in the
second
quarter of
2017
,
an increase
of
$47 million
, or
6%
compared to net sales of
$801 million
during the
second
quarter of
2016
. On a geographic basis, net sales
increased
in every region, compared to the year-ago quarter.
|
•
|
Services:
Net sales were
$649 million
in the
second
quarter of
2017
,
an increase
of
$20 million
, or
3%
compared to net sales of
$629 million
in the
second
quarter of
2016
. On a geographic basis, net sales
increased
in the Americas and
decreased
in EMEA and AP, compared to the year-ago quarter.
|
|
Three Months Ended
|
Six Months Ended
|
||||||||||||||||||||||||
(Dollars in millions, except per share amounts)
|
July 1, 2017
|
|
% of
Sales* |
|
July 2, 2016
|
|
% of
Sales* |
July 1, 2017
|
|
% of
Sales*
|
|
July 2, 2016
|
|
% of
Sales*
|
||||||||||||
Net sales from products
|
$
|
848
|
|
|
|
|
$
|
801
|
|
|
|
$
|
1,551
|
|
|
|
|
$
|
1,503
|
|
|
|
||||
Net sales from services
|
649
|
|
|
|
|
629
|
|
|
|
1,226
|
|
|
|
|
1,120
|
|
|
|
||||||||
Net sales
|
1,497
|
|
|
|
|
1,430
|
|
|
|
2,777
|
|
|
|
|
2,623
|
|
|
|
||||||||
Costs of products sales
|
392
|
|
|
46.2
|
%
|
|
361
|
|
|
45.1
|
%
|
739
|
|
|
47.6
|
%
|
|
726
|
|
|
48.3
|
%
|
||||
Costs of services sales
|
415
|
|
|
63.9
|
%
|
|
393
|
|
|
62.5
|
%
|
778
|
|
|
63.5
|
%
|
|
718
|
|
|
64.1
|
%
|
||||
Costs of sales
|
807
|
|
|
|
|
754
|
|
|
|
1,517
|
|
|
|
|
1,444
|
|
|
|
||||||||
Gross margin
|
690
|
|
|
46.1
|
%
|
|
676
|
|
|
47.3
|
%
|
1,260
|
|
|
45.4
|
%
|
|
1,179
|
|
|
44.9
|
%
|
||||
Selling, general and administrative expenses
|
242
|
|
|
16.2
|
%
|
|
240
|
|
|
16.8
|
%
|
475
|
|
|
17.1
|
%
|
|
475
|
|
|
18.1
|
%
|
||||
Research and development expenditures
|
138
|
|
|
9.2
|
%
|
|
138
|
|
|
9.7
|
%
|
273
|
|
|
9.8
|
%
|
|
274
|
|
|
10.4
|
%
|
||||
Other charges
|
53
|
|
|
3.5
|
%
|
|
74
|
|
|
5.2
|
%
|
79
|
|
|
2.8
|
%
|
|
107
|
|
|
4.1
|
%
|
||||
Operating earnings
|
257
|
|
|
17.2
|
%
|
|
224
|
|
|
15.7
|
%
|
433
|
|
|
15.6
|
%
|
|
323
|
|
|
12.3
|
%
|
||||
Other income (expense):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Interest expense, net
|
(51
|
)
|
|
(3.4
|
)%
|
|
(54
|
)
|
|
(3.8
|
)%
|
(102
|
)
|
|
(3.7
|
)%
|
|
(103
|
)
|
|
(3.9
|
)%
|
||||
Gains (losses) on sales of investments and businesses, net
|
(1
|
)
|
|
(0.1
|
)%
|
|
1
|
|
|
0.1
|
%
|
2
|
|
|
0.1
|
%
|
|
(20
|
)
|
|
(0.8
|
)%
|
||||
Other
|
—
|
|
|
—
|
%
|
|
(4
|
)
|
|
(0.3
|
)%
|
(9
|
)
|
|
(0.3
|
)%
|
|
(11
|
)
|
|
(0.4
|
)%
|
||||
Total other expense
|
(52
|
)
|
|
(3.5
|
)%
|
|
(57
|
)
|
|
(4.0
|
)%
|
(109
|
)
|
|
(3.9
|
)%
|
|
(134
|
)
|
|
(5.1
|
)%
|
||||
Earnings before income taxes
|
205
|
|
|
13.7
|
%
|
|
167
|
|
|
11.7
|
%
|
324
|
|
|
11.7
|
%
|
|
189
|
|
|
7.2
|
%
|
||||
Income tax expense
|
73
|
|
|
4.9
|
%
|
|
59
|
|
|
4.1
|
%
|
114
|
|
|
4.1
|
%
|
|
64
|
|
|
2.4
|
%
|
||||
Net earnings
|
132
|
|
|
8.8
|
%
|
|
108
|
|
|
7.6
|
%
|
210
|
|
|
7.6
|
%
|
|
125
|
|
|
4.8
|
%
|
||||
Less: Earnings attributable to noncontrolling interests
|
1
|
|
|
0.1
|
%
|
|
1
|
|
|
0.1
|
%
|
2
|
|
|
0.1
|
%
|
|
1
|
|
|
—
|
%
|
||||
Net earnings attributable to Motorola Solutions, Inc.
|
$
|
131
|
|
|
8.8
|
%
|
|
$
|
107
|
|
|
7.5
|
%
|
$
|
208
|
|
|
7.5
|
%
|
|
$
|
124
|
|
|
4.7
|
%
|
Earnings per diluted common share
|
$
|
0.78
|
|
|
|
|
|
$
|
0.61
|
|
|
|
|
$
|
1.23
|
|
|
|
|
$
|
0.71
|
|
|
|
|
Three Months Ended
|
|
|
|
Six Months Ended
|
|
|
||||||||||||||
|
July 1,
2017 |
|
July 2,
2016 |
|
% Change
|
|
July 1,
2017 |
|
July 2,
2016 |
|
% Change
|
||||||||||
Segment net sales
|
$
|
848
|
|
|
$
|
801
|
|
|
6
|
%
|
|
$
|
1,551
|
|
|
$
|
1,503
|
|
|
3
|
%
|
Operating earnings
|
168
|
|
|
129
|
|
|
30
|
%
|
|
257
|
|
|
179
|
|
|
44
|
%
|
|
Three Months Ended
|
|
|
|
Six Months Ended
|
|
|
||||||||||||||
|
July 1,
2017 |
|
July 2,
2016 |
|
% Change
|
|
July 1,
2017 |
|
July 2,
2016 |
|
% Change
|
||||||||||
Segment net sales
|
$
|
649
|
|
|
$
|
629
|
|
|
3
|
%
|
|
$
|
1,226
|
|
|
$
|
1,120
|
|
|
9
|
%
|
Operating earnings
|
89
|
|
|
95
|
|
|
(6
|
)%
|
|
176
|
|
|
144
|
|
|
22
|
%
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
July 1, 2017
|
|
July 2, 2016
|
|
July 1, 2017
|
|
July 2, 2016
|
||||||||
Products
|
$
|
3
|
|
|
$
|
33
|
|
|
$
|
16
|
|
|
$
|
54
|
|
Services
|
—
|
|
|
11
|
|
|
6
|
|
|
13
|
|
||||
|
$
|
3
|
|
|
$
|
44
|
|
|
$
|
22
|
|
|
$
|
67
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
July 1, 2017
|
|
July 2, 2016
|
|
July 1, 2017
|
|
July 2, 2016
|
||||||||
Accounts receivable sales proceeds
|
$
|
61
|
|
|
$
|
5
|
|
|
$
|
80
|
|
|
$
|
7
|
|
Long-term receivables sales proceeds
|
22
|
|
|
70
|
|
|
68
|
|
|
134
|
|
||||
Total proceeds from sales of accounts receivable
|
$
|
83
|
|
|
$
|
75
|
|
|
$
|
148
|
|
|
$
|
141
|
|
|
Notional Amount
|
||||||
Net Buy (Sell) by Currency
|
July 1,
2017 |
|
December 31,
2016 |
||||
Euro
|
$
|
161
|
|
|
$
|
122
|
|
British Pound
|
149
|
|
|
246
|
|
||
Chinese Renminbi
|
(81
|
)
|
|
(108
|
)
|
||
Australian Dollar
|
(50
|
)
|
|
(51
|
)
|
||
Brazilian Real
|
(45
|
)
|
|
(56
|
)
|
Period
|
(a) Total Number
of Shares
Purchased
|
|
(b) Average Price
Paid per
Share
(1)
|
|
(c) Total Number
of Shares Purchased
as Part of Publicly
Announced Plans
or Program
(2)
|
|
(d) Approximate Dollar
Value of Shares that
May Yet Be Purchased
Under the Plans or
Program
(2)
|
||||||
3/29/17 to 4/25/17
|
—
|
|
|
N/A
|
|
|
—
|
|
|
$
|
2,013,032,044
|
|
|
4/26/17 to 5/23/17
|
670,847
|
|
|
$
|
83.48
|
|
|
670,847
|
|
|
$
|
1,957,032,460
|
|
5/24/17 to 6/27/17
|
281,077
|
|
|
$
|
83.85
|
|
|
281,077
|
|
|
$
|
1,933,464,276
|
|
Total
|
951,924
|
|
|
$
|
83.59
|
|
|
951,924
|
|
|
|
(1)
|
Average price paid per share of common stock repurchased is the execution price, including commissions paid to brokers.
|
(2)
|
Through actions taken on July 28, 2011, January 30, 2012, July 25, 2012, July 22, 2013, November 3, 2014, and August 3, 2016, the Board of Directors has authorized the Company to repurchase an aggregate amount of up to
$14.0 billion
of its outstanding shares of common stock (the “share repurchase program”). The share repurchase program does not have an expiration date. As of
July 1, 2017
, the Company had used approximately
$12.1 billion
, including transaction costs, to repurchase shares, leaving
$1.9 billion
of authority available for future repurchases.
|
Exhibit No.
|
|
Exhibit
|
10.1
|
|
Revolving Credit Agreement dated as of April 25, 2017 among Motorola Solutions, Inc., JPMorgan Chase Bank, N.A., as administrative agent, and the several lenders and agents party thereto (incorporated by reference to Exhibit 10.1 to Motorola Solutions Current Report on Form 8-K filed on April 27, 2017 (File No. 1-7221)).
|
*10.2
|
|
Description of Insurance covering non-employee directors and their spouses (including a description incorporated by reference from the information under the caption "Director Retirement Plan and Insurance Coverage" of the Motorola Solutions' Proxy Statement filed March 27, 2017 (File No. 1-7221))
|
*31.1
|
|
Certification of Gregory Q. Brown pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
*31.2
|
|
Certification of Gino A. Bonanotte pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
*32.1
|
|
Certification of Gregory Q. Brown pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
*32.2
|
|
Certification of Gino A. Bonanotte pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
101.INS
|
|
XBRL Instance Document
|
101.SCH
|
|
XBRL Taxonomy Extension Scheme Document
|
101.CAL
|
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
101.DEF
|
|
XBRL Taxonomy Extension Definition Linkbase Document
|
101.LAB
|
|
XBRL Taxonomy Extension Label Linkbase Document
|
101.PRE
|
|
XBRL Taxonomy Extension Presentation Linkbase Document
|
*
|
Filed herewith
|
|
MOTOROLA, MOTOROLA SOLUTIONS and the Stylized M Logo are trademarks or registered trademarks of Motorola Trademark Holdings, LLC and are used under license. All other trademarks are the property of their respective owners. ©2017 Motorola Solutions, Inc. All rights reserved.
|
|
MOTOROLA SOLUTIONS, INC.
|
||
|
|
|
|
|
By:
|
|
/
S
/ J
OHN
K. W
OZNIAK
|
|
|
|
John K. Wozniak
Corporate Vice President and
Chief Accounting Officer
(Principal Accounting Officer)
|
Exhibit No.
|
|
Exhibit
|
10.1
|
|
Revolving Credit Agreement dated as of April 25, 2017 among Motorola Solutions, Inc., JPMorgan Chase Bank, N.A., as administrative agent, and the several lenders and agents party thereto (incorporated by reference to Exhibit 10.1 to Motorola Solutions Current Report on Form 8-K filed on April 27, 2017 (File No. 1-7221)).
|
|
Description of Insurance covering non-employee directors and their spouses (including a description incorporated by reference from the information under the caption "Director Retirement Plan and Insurance Coverage" of the Motorola Solutions' Proxy Statement filed March 27, 2017 (File No. 1-7221))
|
|
|
Certification of Gregory Q. Brown pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
|
Certification of Gino A. Bonanotte pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
*32.1
|
|
Certification of Gregory Q. Brown pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
|
Certification of Gino A. Bonanotte pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
|
101.INS
|
|
XBRL Instance Document
|
101.SCH
|
|
XBRL Taxonomy Extension Scheme Document
|
101.CAL
|
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
101.DEF
|
|
XBRL Taxonomy Extension Definition Linkbase Document
|
101.LAB
|
|
XBRL Taxonomy Extension Label Linkbase Document
|
101.PRE
|
|
XBRL Taxonomy Extension Presentation Linkbase Document
|
*
|
Filed herewith
|
•
|
intentionally self-inflicted Injury.
|
•
|
suicide or attempted suicide.
|
•
|
war or any act of war, whether declared or not (except as provided by the Policy).
|
•
|
a Covered Accident that occurs while on active duty service in the military, naval or air force of any country or international organization. Upon Our receipt of proof of service, We will refund any premium paid for this time. Reserve or National Guard active duty training is not excluded unless it extends beyond 31 days.
|
•
|
sickness, disease, bodily or mental infirmity, bacterial infections, except infections which occur as a result of accidental injury or accidental involuntary or unintentional ingestion of a contaminated substance.
|
•
|
piloting or serving as a crewmember in any aircraft (except as provided by the Policy).
|
•
|
commission of, or attempt to commit, a felony.
|
•
|
the United States
|
•
|
The Covered Person’s Home Country
|
•
|
The Covered Person’s Country of Permanent Assignment
|
•
|
Routine physicals and care of any kind.
|
•
|
Routine dental care and treatment.
|
•
|
Cosmetic surgery, except for reconstructive surgery needed as the result of an Injury.
|
•
|
Routine nursery care.
|
•
|
Eye refractions or eye examinations for the purpose of prescribing corrective lenses or for the fitting thereof; eyeglasses, contact lenses, and hearing aids.
|
•
|
Services, supplies, or treatment including any period of Hospital confinement which is not recommended, approved, and certified as medically necessary and reasonable by a Doctor, or expenses which are non-medical in nature.
|
•
|
Treatment or service provided by a private duty nurse.
|
•
|
Treatment by any Immediate Family Member or member of the Insured’s household.
|
•
|
Expenses incurred during holiday travel, or travel for purposes of seeking medical care or treatment, or for any other travel that is not in the course of the Policyholder’s business (unless Personal Deviations are specifically covered).
|
•
|
Covered medical expenses for which the Covered Person would not be responsible for in the absence of the Policy.
|
•
|
Any expense paid or payable by any other valid and collectible group insurance plan.
|
•
|
Injury or sickness for which benefits are paid or payable under any workers’ compensation or occupational disease law or act, or similar legislation, whether United States federal or foreign law.
|
IMPORTANT NOTICE
|
This policy provides travel insurance benefits for individuals traveling outside of their home country. This policy does not constitute comprehensive health insurance coverage (often referred to as “major medical coverage”) and does not satisfy a person’s individual obligation to secure the requirement of minimum essential coverage under the Affordable Care Act (ACA).
For more information about the ACA, please refer to
www.HealthCare.gov
.
|
1.
|
I have reviewed the quarterly report on Form 10-Q of Motorola Solutions, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
|
/s/ GREGORY Q. BROWN
|
|
Gregory Q. Brown
|
|
Chairman and Chief Executive Officer
|
|
Motorola Solutions, Inc.
|
1.
|
I have reviewed this quarterly report on Form 10-Q of Motorola Solutions, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
|
/s/ GINO A. BONANOTTE
|
|
Gino A. Bonanotte
|
|
Executive Vice President and Chief Financial Officer
|
|
Motorola Solutions, Inc.
|
(1)
|
the quarterly report on Form 10-Q for the period ended
July 1, 2017
(the “Quarterly Report”), which this statement accompanies fully complies with the requirements of Section 13(a) of the Securities Exchange Act of 1934 (15 U.S.C. 78m); and
|
(2)
|
the information contained in the Quarterly Report fairly presents, in all material respects, the financial condition and results of operations of Motorola Solutions, Inc.
|
|
/s/ GREGORY Q. BROWN
|
|
Gregory Q. Brown
|
|
Chairman and Chief Executive Officer
|
|
Motorola Solutions, Inc.
|
(1)
|
the quarterly report on Form 10-Q for the period ended
July 1, 2017
(the “Quarterly Report”), which this statement accompanies fully complies with the requirements of Section 13(a) of the Securities Exchange Act of 1934 (15 U.S.C. 78m); and
|
(2)
|
the information contained in the Quarterly Report fairly presents, in all material respects, the financial condition and results of operations of Motorola Solutions, Inc.
|
|
/s/ GINO A. BONANOTTE
|
|
Gino A. Bonanotte
|
|
Executive Vice President and Chief Financial Officer
|
|
Motorola Solutions, Inc.
|