Motorola Solutions Reports Fourth-Quarter and Full-Year Financial Results

Company Achieves Record Q4 and Full-Year Sales, Earnings Per Share and Backlog

• Sales of $2.7 billion, up 17% from Q4 in the prior year; up 12% for full year
◦ Products and Systems Integration sales grew 21% in Q4; up 14% for full year
◦ Software and Services sales grew 9% in Q4; up 8% for full year
• Record backlog of $14.3 billion, up $788 million or 6% versus a year ago
• Generated record $1.3 billion of operating cash flow in Q4; $1.8 billion for full year
• GAAP Q4 earnings per share (EPS) of $3.43, up 49% versus a year ago; $7.93 for full year
• Non-GAAP Q4 EPS* of $3.60, up 26% versus a year ago; $10.36 for full year, up 13%

CHICAGO - February 9, 2023 - Motorola Solutions, Inc. (NYSE: MSI) today reported its earnings results
for the fourth quarter and full year of 2022.

“2022 was an outstanding year, with record sales in both segments and all three technologies,” said Greg
Brown, chairman and CEO of Motorola Solutions. “We achieved all-time Q4 records in sales, operating
earnings, earnings per share and cash flow, highlighting the strong demand we continue to see for our
public safety and enterprise security solutions. Our record backlog and a robust funding environment
position us exceptionally well going forward.”

KEY FINANCIAL RESULTS (presented in millions, except per share data and percentages)

Fourth Quarter Full Year

Q4 2022 Q4 2021 % Change 2022 2021 % Change
Sales $2,706 $2,320 17 % $9,112 $8,171 12 %
GAAP
Operating Earnings $692 $549 26 % $1,661 $1,667 —%
% of Sales 25.6 % 23.7 % 18.2 % 20.4 %
EPS $3.43 $2.30 49 % $7.93 $7.17 11 %
Non-GAAP*
Operating Earnings $822 $670 23 % $2,368 $2,117 12 %
% of Sales 30.4 % 28.9 % 26.0 % 25.9 %
EPS $3.60 $2.85 26 % $10.36 $9.15 13 %
Products and Systems Integration Segment
Sales $1,810 $1,495 21 % $5,728 $5,033 14 %
GAAP Operating Earnings $454 $320 42 % $913 $760 20 %
% of Sales 25.1 % 21.4 % 15.9 % 15.1 %
Non-GAAP Operating Earnings* $514 $378 36 % $1,172 $976 20 %
% of Sales 28.4 % 25.3 % 20.5 % 19.4 %
Software and Services Segment
Sales $896 $825 9% $3,384 $3,138 8%
GAAP Operating Earnings $238 $229 4% $748 $907 (18)%
% of Sales 26.6 % 27.8 % 22.1 % 28.9 %
Non-GAAP Operating Earnings* $308 $292 5% $1,196 $1,141 5%
% of Sales 34.4 % 35.4 % 35.3 % 36.4 %

1
*Non-GAAP financial information excludes the after-tax impact of approximately $0.17 for Q4 and $2.43 for FY per diluted share
related to highlighted items, including share-based compensation expenses and intangible assets amortization expense. Details
regarding these non-GAAP adjustments and the use of non-GAAP measures are included later in this news release.

OTHER SELECT FOURTH-QUARTER FINANCIAL RESULTS

• Revenue - Fourth-quarter sales were $2.7 billion, up 17% from the year-ago quarter driven by
growth in North America and International. Revenue from acquisitions was $39 million, and
currency headwinds were $87 million. The Products and Systems Integration segment increased
21% due to growth in land mobile radio (LMR) and video security and access control (Video). The
Software and Services segment grew 9% driven by growth in LMR services, Video and Command
center.
• Operating margin - GAAP operating margin was 25.6% of sales, up from 23.7% in the year-ago
quarter. Non-GAAP operating margin was 30.4% of sales, up from 28.9% in the year-ago quarter.
The increase in both GAAP and non-GAAP operating margin was primarily driven by higher sales
in both segments and improved operating leverage in the Products and Systems Integration
segment.
• Taxes - The GAAP effective tax rate was 11.0%, down from 22.4% in the year-ago quarter
driven primarily by higher benefits in the current year related to a partial release of a valuation
allowance recorded on the U.S. foreign tax credits carryforward and higher stock-based
compensation. The non-GAAP effective tax rate was 21.2%, compared to 22.3% in the year-ago
quarter, driven by higher benefits from stock-based compensation in the current year.
• Cash flow - Operating cash flow was $1.3 billion, up $570 million compared to the year-ago
quarter. Free cash flow was $1.2 billion, up $565 million compared to the year-ago quarter. The
increase in both operating and free cash flow was driven by improvements in working capital
and higher earnings.
• Capital allocation - During the quarter, the company paid $132 million in dividends,
repurchased $87 million of its common stock and incurred $73 million in capital expenditures.
Additionally, the company closed the acquisitions of Rave Mobile Safety and FutureCom
Systems Group for $553 million and $30 million, net of cash acquired, respectively.

OTHER SELECT FULL-YEAR FINANCIAL RESULTS

• Revenue - Full-year sales were $9.1 billion, up 12% driven by growth in North America and
International. The Products and Systems Integration segment grew 14% primarily due to higher
sales of LMR and Video. The Software and Services segment grew 8% driven by growth in Video,
LMR services and Command center. The impact of unfavorable currency rates was $216 million
and sales from acquisitions was $121 million.
• Operating margin - For the full year, GAAP operating margin was 18.2% of sales, compared to
20.4% for the prior year. The decrease was primarily driven by a fixed asset impairment charge of
$147 million related to the exit from the Emergency Services Network (ESN) contract in the U.K.
and higher stock based compensation in the current year. Non-GAAP operating margin was
26.0% of sales, up from 25.9% in the prior year, driven by higher sales and improved operating
leverage, partially offset by higher material costs and expenses from acquisitions.
• Taxes - The 2022 GAAP effective tax rate was 9.8%, down from 19.5% in the prior year driven
primarily by a discrete deferred tax benefit as a result of the taxable reorganization of our
intellectual property in the current year, a benefit from a partial release of the valuation
 allowance recorded on the U.S. foreign tax credit carryforward and the benefit from higher stock
based compensation in the current year. The non-GAAP effective tax rate was 20.1%, down
from 21.0% in the previous year, primarily driven by the benefit from higher stock based
compensation in the current year.
• Cash flow - The company generated $1.8 billion in operating cash and free cash flow was
$1.6 billion in both the current and prior years. Higher earnings generated in the current year
were offset by an increase in working capital and higher incentive payments.
• Capital allocation - In 2022, the company paid $1.2 billion, net of cash acquired, for seven
acquisitions, repurchased $836 million of its common stock at an average price of $225 per
share and paid $530 million in dividends. The company also issued $600 million of long-term
debt and repaid $275 million of outstanding long-term debt.
• Backlog - The company ended the year with record backlog of $14.3 billion, up $788 million
from the prior year. Products and Systems Integrations segment backlog was up 22% or
$894 million driven by record LMR product orders. Software and Services segment backlog was
down 1% or $106 million, primarily driven by revenue recognition for the Airwave and ESN
contracts, $367 million of unfavorable currency rates, and a reduction relating to the exit from
the ESN contract, partially offset by growth in multi-year software and services contracts in
North America.

NOTABLE WINS & ACHIEVEMENTS IN Q4

Software and Services

• $56M P25 multi-year managed service extension of the Interexport contract for the Chilean National
Law Enforcement Police
• $25M P25 software upgrade agreement renewal for a large U.S. customer
• $22M NG911 expansion and renewal for Greater Harris County, TX
• $21M system upgrade and multi-year services renewal for Lane County, OR
• $15M P25 and command center upgrade agreement extension order for Columbus, GA
• $15M license plate recognition camera system expansion order for the Illinois State Police

Products and Systems Integration

• $45M P25 APX NEXT devices order for the city of Houston, TX
• $39M P25 APX NEXT devices order for a large U.S. customer
• $30M P25 APX NEXT devices order for the city of Dallas, TX
• $21M add-on P25 APX NEXT devices order for a large U.S. customer
• $20M P25 APX NEXT devices and command center order for Kansas City, MO
• $19M P25 system order for a large international customer
• $3M fixed video order for Metra Rail
BUSINESS OUTLOOK
• First-quarter 2023 - The company expects revenue growth between 12% and 13% compared to
the first quarter of 2022. The company expects non-GAAP earnings per share in the range of
$2.02 to $2.07 per share. This assumes approximately $40 million in foreign exchange
headwinds, approximately 172 million fully diluted shares, and an effective tax rate of
approximately 23%.
• Full-year 2023 - The company expects revenue in the range of $9.65 billion to $9.7 billion and
non-GAAP earnings per share in the range of $11.10 to $11.22 per share. This assumes
approximately $40 million in foreign exchange headwinds, approximately 172 million fully diluted
shares and a non-GAAP effective tax rate of 23% to 24%.

The company has not quantitatively reconciled its guidance for forward-looking non-GAAP
measurements in this news release to their most comparable GAAP measurements because the
company does not provide specific guidance for the various reconciling items as certain items that impact
these measures have not occurred, are out of the company’s control, or cannot be reasonably predicted.
Accordingly, a reconciliation to the most comparable GAAP financial measurement is not available
without unreasonable effort. Please note that the unavailable reconciling items could significantly impact
the company’s results.

RECENT EVENTS

CMA UPDATE
In October 2021, the United Kingdom’s Competition and Markets Authority (the CMA) announced that it
had opened a market investigation into the Mobile Radio Network for the Police and Emergency
Services. This investigation affects Airwave, the company’s private mobile radio communications network
that it acquired in 2016. Airwave provides mission-critical voice and data communications to public
emergency service agencies in Great Britain. In October 2022, the CMA published a provisional decision
with its findings regarding competition and proposed remedies. The company disagrees with the CMA’s
provisional decision and will continue to work with the CMA to demonstrate the value of the Airwave
network and pursue its legal avenues to protect Airwave’s contractual position.

ESN MATTERS
During the year ended December 31, 2022, the company signed a mutual agreement with the Home
Office for the company to exit the ESN contract early, inclusive of twelve months of transition services
through the end of 2023. During the third quarter of 2022, the company determined that the future service
potential of the ESN communications systems contract was limited, based on the company's intention to
terminate the contract in advance of the contracted service term. The company thus recorded a fixed
asset impairment loss of $147 million related to assets constructed and used in the deployment of the
contract.
MACROECONOMIC EVENTS
During fiscal year 2022, the company operated under challenging market conditions, influenced by
events such as those discussed below. For a more complete discussion of the risks the company
encounters in its business, please refer to Part I. Item 1A. “Risk Factors” in the company’s Annual Report
on Form 10-K for the fiscal year ended December 31, 2021 and Part II. Item 1A. “Risk Factors” in the
company’s Quarterly Report on Form 10-Q for the fiscal quarter ended October 2, 2022.

Russia-Ukraine Conflict

During the first quarter of 2022, in response to Russia's invasion of Ukraine, the company suspended all
sales, provision of services and shipments of its products to Russia and Belarus, which did not constitute
a material portion of the company's business. For the year ended December 31, 2021, the company's net
sales in Russia and Belarus were less than $25 million. However, throughout 2022, the company
indirectly experienced impacts from the Russia-Ukraine conflict (as further described below). While the
company does not anticipate that the current posture of the Russia-Ukraine conflict will materially and
adversely affect its results of operations, the conflict is still ongoing and has had, and may continue to
have, a significant impact on the global macroeconomic and geopolitical environments, including
increased volatility in capital and commodity markets, rapid changes to regulatory conditions (including
the use of sanctions), supply chain and operational challenges for multinational corporations, inflationary
pressures and an increased risk of cybersecurity incidents.

COVID-19, Supply Chain Disruptions & Inflationary Cost Environment

Throughout 2022, the company's supply chain was, and continues to be, impacted by global issues
related to the effects of the COVID-19 pandemic, the Russia-Ukraine conflict and the inflationary cost
environment, particularly with respect to materials in the semiconductor market, including part shortages,
increased freight costs, diminished transportation capacity and labor constraints. This has resulted in
disruptions in the company's supply chain, as well as difficulties and delays in procuring certain
semiconductor components. Cost increases were driven by elevated lead times and increased material
costs, in particular the need to purchase semiconductor components from alternative sources, including
brokers. While the company continued to navigate supply chain constraints in 2022, the company
anticipates the broader impact of inflationary pressures and increased material and supply chain costs
and disruptions (including elevated costs to procure materials within the semiconductor market) to
continue into 2023. However, the company expects global transportation costs to improve in 2023 as
compared to 2022. The company is closely monitoring supply chain disruptions and continues to remain
focused on improving its supplier network, engineering alternative designs and working to reduce supply
shortages. The company also continues to actively manage its inventory in an effort to minimize supply
chain disruptions and enable continuity of supply and services to its customers, and the company
expects to maintain elevated levels of inventory until supply constraints have been remediated.

In order to combat rising inflation in the U.S., the Federal Reserve has raised interest rates multiple times
since the beginning of 2022. The increase in U.S. dollar interest rates and overall market conditions led to
significant strengthening of the U.S. dollar against many other global currencies in 2022. The strong U.S.
dollar negatively impacted cash generated from the company's foreign operations in 2022, driven by
revenues and costs that are denominated in foreign currencies. The company expects fluctuations in the
value of U.S. dollar relative to other currencies to continue to impact its operating cash flows and net
earnings throughout 2023.

Although the macroeconomic environment continued to introduce challenges during 2022, the company
is encouraged by customer demand for the company's products and services. Specifically, in the
Software and Services segment, with the largely recurring nature of the business and its strong backlog
position, the company expects that the impact to operating margin will be limited during 2023. While the
company was encouraged by strong backlog and growth in the Products and Systems Integration
segment throughout 2022, which the company expects to continue to grow during 2023, supply
constraints continue to impact the company's business and the company expects demand for its products
will continue to outpace its ability to obtain semiconductor component supply throughout 2023. Where
appropriate, the company has taken pricing actions around its product and service offerings to mitigate
exposure to inflationary pressures on its businesses and benefited from these adjustments during 2022.
The company expects to further benefit from such adjustments throughout 2023. Further, demand
continues to be supported with ongoing sources of government funding, including the American Rescue
Plan Act of 2021 ("ARPA"), which is intended to provide economic stimulus. The company experienced
the positive impact of the ARPA funding on its business and results of operations throughout 2022 and
anticipate that the ARPA will continue to have a positive impact on the company's business in 2023.

CONFERENCE CALL AND WEBCAST Motorola Solutions will host its quarterly conference call
beginning at 4 p.m. U.S. Central Standard Time (5 p.m. U.S. Eastern Standard Time) on Thursday,
February 9. The conference call will be webcast live with audio and slides at
www.motorolasolutions.com/investor. An archive of the webcast will be available for a limited period of
time thereafter.

CONSOLIDATED GAAP RESULTS (presented in millions, except per share data)

A comparison of results from operations is as follows:
Fourth Quarter Full Year
2022 2021 2022 2021
Net sales $2,706 $2,320 $9,112 $8,171
Gross margin 1,351 1,183 4,229 4,040
Operating earnings 692 549 1,661 1,667
Amounts attributable to Motorola Solutions, Inc. common stockholders
Net earnings 589 401 1,363 1,245
Diluted EPS from continuing operations $3.43 $2.30 $7.93 $7.17
Weighted average diluted common shares outstanding 171.9 174.2 171.9 173.6
USE OF NON-GAAP FINANCIAL INFORMATION
In addition to the results presented in accordance with accounting principles generally accepted in the
U.S. ("GAAP") included in this news release, Motorola Solutions also has included non-GAAP
measurements of results, including free cash flow, non-GAAP operating earnings, non-GAAP EPS, non-
GAAP operating margin, non-GAAP tax rate and organic revenue. The company has provided these non-
GAAP measurements to help investors better understand its core operating performance, enhance
comparisons of core operating performance from period-to-period and allow better comparisons of
operating performance to that of its competitors. Among other things, management uses these operating
results, excluding the identified items, to evaluate performance of its businesses and to evaluate results
relative to certain incentive compensation targets. Management uses operating results excluding these
items because it believes these measurements enable it to make better period-to-period evaluations of
the financial performance of its core business operations. The non-GAAP measurements are intended
only as a supplement to the comparable GAAP measurements and the company compensates for the
limitations inherent in the use of non-GAAP measurements by using GAAP measures in conjunction with
the non-GAAP measurements. As a result, investors should consider these non-GAAP measurements in
addition to, and not in substitution for or as superior to, GAAP measurements.

Reconciliations: Details and reconciliations of such non-GAAP measurements to the corresponding

GAAP measurements can be found at the end of this news release.

Free cash flow: Free cash flow represents net cash provided by operating activities less capital
expenditures. The company believes that free cash flow is useful to investors as the basis for comparing
its performance and coverage ratios with other companies in the company's industries, although the
company's measure of free cash flow may not be directly comparable to similar measures used by other
companies. This measure is also used as a component of incentive compensation.

Organic Revenue: Organic revenue reflects net sales calculated under GAAP excluding net sales from
acquired business owned for less than four full quarters. The company believes organic revenue
provides useful information for evaluating the periodic growth of the business on a consistent basis and
provides for a meaningful period-to-period comparison and analysis of trends in the business.

Non-GAAP operating earnings, non-GAAP EPS and non-GAAP operating margin each excludes
highlighted items, including share-based compensation expenses and intangible assets amortization
expense, as follows:
Highlighted items: The company has excluded the effects of highlighted items including, but not limited
to, acquisition-related transaction fees, tangible and intangible asset impairments, reorganization of
business charges, certain non-cash pension adjustments, legal settlements and other contingencies,
gains and losses on investments and businesses, Hytera-related legal expenses, gains and losses on the
extinguishment of debt and the income tax effects of significant tax matters, from its non-GAAP operating
expenses and net income measurements because the company believes that these historical items do
not reflect expected future operating earnings or expenses and do not contribute to a meaningful
evaluation of the company's current operating performance or comparisons to the company's past
operating performance. For the purposes of management's internal analysis over operating performance,
the company uses financial statements that exclude highlighted items, as these charges do not contribute
to a meaningful evaluation of the company's current operating performance or comparisons to the
company's past operating performance.

Hytera-Related Legal Expenses: On March 14, 2017, the company filed a complaint in the U.S. District
Court for the Northern District of Illinois (the “Court”) against Hytera Communications Corporation Limited
of Shenzhen, China; Hytera America, Inc.; and Hytera Communications America (West), Inc. (collectively,
“Hytera”), alleging trade secret theft and copyright infringement and seeking, among other things,
injunctive relief, compensatory damages, and punitive damages. On February 14, 2020, the company
announced that a jury decided in the company's favor in its trade secret theft and copyright infringement
case. In connection with this verdict, the jury awarded the company $345.8 million in compensatory
damages and $418.8 million in punitive damages, for a total of $764.6 million. On December 17, 2020,
the Court denied the company’s motion for a permanent injunction, finding instead that Hytera must pay
the company a forward-looking reasonable royalty on products that use the company’s stolen trade
secrets. As the parties were unable to agree on a reasonable royalty rate, the Court entered an order
favorable to the company on December 15, 2021, and, consistent with the company's requests, set
royalty rates for Hytera's sale of relevant products from July 1, 2019 forward. On July 5, 2022, the Court
ordered that Hytera pay into a third-party escrow on July 31, 2022, the royalties owed to the company
based on the sale of relevant products from July 1, 2019 to June 30, 2022. Hytera failed to make the
required royalty payment on July 31, 2022. On August 1, 2022, Hytera filed a motion to modify or stay the
Court’s previous July 5, 2022 royalty order. On August 3, 2022, the company filed a motion seeking to
hold Hytera in civil contempt for violating the royalty order by not making the required royalty payment in
July. Hytera made quarterly royalty payments on October 31, 2022 and January 31, 2023.

In response to the Court's decision to award the company $764.6 million in compensatory and punitive
damages, Hytera motioned for certain equitable relief, which the Court granted on January 8, 2021,
reducing the $764.6 million judgment award to $543.7 million. That same day, the Court also granted the
company’s motion for prejudgment interest. On August 10, 2021, the Court ruled that Hytera must pay the
company $51.1 million in prejudgment interest and $2.6 million in costs. On March 25, 2021, the Court
entered rulings favorable to the company with respect to several of the company's post-trial motions,
including the company's motion for attorneys' fees and its motion to require Hytera to turn over certain
assets in satisfaction of the company’s judgment award. On October 15, 2021, the Court granted the
company’s request for $34.2 million in attorneys’ fees against Hytera. On September 29, 2021, the
company filed two additional motions with the Court, requesting the Court to reconsider its order denying
the company’s request for an injunction, and requesting that the Court enforce its ruling requiring Hytera
to turn over certain assets in satisfaction of the company's judgment award, or, in the alternative, hold
Hytera in contempt. On July 5, 2022, the Court denied both motions.
On September 7, 2021, Hytera filed a notice of appeal of the Court’s judgment with the U.S. Court of
Appeals for the Seventh Circuit (the "Court of Appeals"). The Court of Appeals dismissed the notice of
appeal on February 16, 2022 after determining that such appeal was premature. On August 2, 2022, after
the Court denied the motions described on July 5, 2022, Hytera filed a renewed notice of appeal in the
Court of Appeals. The company filed its cross-appeal on August 5, 2022. Hytera filed its appellate court
brief on November 15, 2022. The company’s reply brief is due on February 13, 2023.

Separate from the company's litigation with Hytera, on May 27, 2020, Hytera America, Inc. and Hytera
Communications America (West), Inc. each filed for Chapter 11 bankruptcy protection in the U.S.
Bankruptcy Court for the Central District of California (the “Bankruptcy Court”). The company filed
motions in the Bankruptcy Court to dismiss the bankruptcy proceedings in July 2020. On January 22,
2021, the Bankruptcy Court entered an agreed order, allowing a partial sale of Hytera's U.S. assets in the
bankruptcy proceedings. The proposed sale does not include Hytera inventory accused of including the
company’s intellectual property. On February 11, 2022, the Court entered an order to confirm the
liquidation plan for the two Hytera entities and the distributions were made on February 25, 2022 to the
creditors, including $13 million to the company. On December 22, 2022, an additional distribution of
$2 million was made to the company as well as an assignment of various delinquent accounts receivable
of the bankrupt Hytera entities. The gains for the two monetary distributions were recorded to Other
charges (income) in the company’s Consolidated Statements of Operations.

Management typically considers legal expenses associated with defending the company's intellectual
property as “normal and recurring” and accordingly, Hytera-related legal expenses were included in both
the company's GAAP and non-GAAP operating income for fiscal years 2017, 2018 and 2019. The
company anticipates further expenses associated with Hytera-related litigation; however, as of 2020, the
company believes that these expenses are no longer a part of the “normal and recurring” legal expenses
incurred to operate its business. In addition, as any contingent or actual gains associated with the Hytera
litigation are recognized, they will be similarly excluded from the company's non-GAAP operating income,
consistent with the company's treatment of the approximately $15 million of proceeds realized in 2022.
The company believes after the jury award, the presentation of excluding both Hytera-related legal
expenses and gains related to awards better aligns with how management evaluates the company's
ongoing underlying business performance.

Share-based compensation expenses: The company has excluded share-based compensation expense
from its non-GAAP operating expenses and net income measurements. Although share-based
compensation is a key incentive offered to the company’s employees and the company believes such
compensation contributed to the revenue earned during the periods presented and also believes it will
contribute to the generation of future period revenues, the company continues to evaluate its
performance excluding share-based compensation expense primarily because it represents a significant
non-cash expense. Share-based compensation expense will recur in future periods.

Intangible assets amortization expense: The company has excluded intangible assets amortization
expense from its non-GAAP operating expenses and net earnings measurements, primarily because it
represents a non-cash expense and because the company evaluates its performance excluding
intangible assets amortization expense. Amortization of intangible assets is consistent in amount and
frequency but is significantly affected by the timing and size of the company’s acquisitions. Investors
should note that the use of intangible assets contributed to the company’s revenues earned during the
periods presented and will contribute to the company’s future period revenues as well. Intangible assets
amortization expense will recur in future periods.

FORWARD LOOKING STATEMENTS

This news release contains "forward-looking statements" within the meaning of applicable federal
securities law. These statements are made pursuant to the safe harbor provisions of the Private
Securities Litigation Reform Act of 1995 and generally include words such as “believes,” “expects,”
“intends,” “anticipates,” “estimates” and similar expressions. The company can give no assurance that
any actual or future results or events discussed in these statements will be achieved. Any forward-looking
statements represent the company’s views only as of today and should not be relied upon as
representing the company’s views as of any subsequent date. Readers are cautioned that such forward-
looking statements are subject to a variety of risks and uncertainties that could cause the company’s
actual results to differ materially from the statements contained in this release. Such forward-looking
statements include, but are not limited to, Motorola Solutions’ financial outlook for the first quarter and
full-year of 2023; the impact of the CMA’s provisional decision regarding Airwave (including Motorola
Solutions’ actions in response to such provisional decision); the impact of Motorola Solutions’ entry into a
signed agreement with the Home Office for us to exit from the ESN contract early; and the impact of the
COVID-19 pandemic, supply chain constraints, the Russia-Ukraine conflict, inflation and the ARPA,
including the impact of actions taken by Motorola Solutions or others in response to such events, on
Motorola Solutions' business and results of operations. Motorola Solutions cautions the reader that the
risks and uncertainties below, as well as those in Part I Item 1A of Motorola Solutions’ 2021 Annual
Report on Form 10-K, Part II Item 1A of Motorola Solutions’ 2022 Third Quarter Report on Form 10-Q,
and in its other SEC filings available for free on the SEC’s website at www.sec.gov and on Motorola
Solutions’ website at www.motorolasolutions.com, could cause Motorola Solutions’ actual results to differ
materially from those estimated or predicted in the forward-looking statements. Many of these risks and
uncertainties cannot be controlled by Motorola Solutions, and factors that may impact forward-looking
statements include, but are not limited to: (i) the impact including increased costs and potential liabilities,
associated with changes in laws and regulations regarding privacy, data protection and information
security; (ii) challenges relating to existing or future legislation and regulations pertaining to artificial
intelligence (“AI”), AI-enabled products and the use of biometrics and other video analytics; (iii) the
impact of government regulation of radio frequencies; (iv) audits and regulations and laws applicable to
our U.S. government customer contracts and grants; (v) the impact, including additional compliance
obligations, associated with existing or future telecommunications-related laws and regulations; (vi) the
evolving state of environmental regulation relating to climate change, and the physical risks of climate
change; (vii) impact of product regulatory and safety, consumer, worker safety and environmental laws;
(viii) impact of tax matters; (ix) the continuing and future impact of the COVID-19 pandemic on our
business; (x) additional compliance obligations and increased risk, costs and competition associated with
the expansion of our technologies within our Products and Systems Integration and Software and
Services segments (including, but not limited to, with respect to the CMA's provisional decision regarding
Airwave); (xi) the effectiveness of our investments in new products and technologies; (xii) the
effectiveness of our strategic acquisitions, including the integrations of such acquired businesses; (xiii)
increased cybersecurity threats, a security breach or other significant disruption of our IT systems or
those of our outsource partners, suppliers or customers; (xiv) our inability to protect our intellectual
property or potential infringement of intellectual property rights of third parties; (xv) our license of the
MOTOROLA, MOTO, MOTOROLA SOLUTIONS and the Stylized M logo and all derivatives and
formatives thereof from Motorola Trademark Holdings, LLC; (xvi) the global nature of our employees,
customers, suppliers and outsource partners; (xvii) our use of third-parties to develop, design and/or
manufacture many of our components and some of our products, and to perform portions of our business
operations; (xviii) the inability of our subcontractors to perform in a timely and compliant manner or
adhere to our Human Rights Policy; (xix) our inability to purchase at acceptable prices a sufficient amount
of materials, parts, and components, as well as software and services, to meet the demands of our
customers, and any disruption to our suppliers or significant increase in the price of supplies; (xx) risks
related to our large, multi-year system and services contracts (including, but not limited to, with respect to
the ESN and Airwave contracts); (xxi) the inability of our products to meet our customers’ expectations or
regulatory or industry standards; (xxii) impact of current global economic and political conditions in the
markets in which we operate (including, but not limited to, the Russia-Ukraine conflict and inflation); (xxiii)
impact of returns on pension and retirement plan assets and interest rate changes; (xxiv) inability to
access the capital markets for financing on acceptable terms and conditions; (xxv) inability to attract and
retain senior management and key employees; (xxvi) impact of the ARPA on our business; and (xxvii) the
return of capital to shareholders through dividends and/or repurchasing shares. Motorola Solutions
undertakes no obligation to publicly update any forward-looking statement or risk factor, whether as a
result of new information, future events or otherwise.

ABOUT MOTOROLA SOLUTIONS

Motorola Solutions is a global leader in public safety and enterprise security. Our solutions in land mobile
radio communications, video security & access control and command center, bolstered by managed &
support services, create an integrated technology ecosystem to help make communities safer and help
businesses stay productive and secure. At Motorola Solutions, we’re ushering in a new era in public
safety and security. Learn more at www.motorolasolutions.com.

MEDIA CONTACT
Alexandra Reynolds
Motorola Solutions
+1 312-965-3968
Alexandra.Reynolds@motorolasolutions.com

INVESTOR CONTACT
Tim Yocum
Motorola Solutions
+1 847-576-6899
Tim.Yocum@motorolasolutions.com
 GAAP-1
Motorola Solutions, Inc. and Subsidiaries
Consolidated Statements of Operations
(In millions, except per share amount)
Three Months Ended
December 31, 2022 December 31, 2021
Net sales from products $ 1,671 $ 1,358
Net sales from services 1,035 962
Net sales 2,706 2,320
Costs of products sales 751 589
Costs of services sales 604 548
Costs of sales 1,355 1,137
Gross margin 1,351 1,183
Selling, general and administrative expenses 381 368
Research and development expenditures 201 189
Other charges 14 13
Intangibles amortization 63 64
Operating earnings 692 549
Other income (expense):
Interest expense, net (54) (54)
Gains on sales of investments and businesses, net — 1
Other, net 25 22
Total other expense (29) (31)
Net earnings before income taxes 663 518
Income tax expense 73 116
Net earnings 590 402
Less: Earnings attributable to noncontrolling interests 1 1
Net earnings attributable to Motorola Solutions, Inc. $ 589 $ 401
Earnings per common share:
Basic: $ 3.52 $ 2.38
Diluted: $ 3.43 $ 2.30
Weighted average common shares outstanding:
Basic 167.4 168.8
Diluted 171.9 174.2
Percentage of Net Sales*
Net sales from products 61.8 % 58.5 %
Net sales from services 38.2 % 41.5 %
Net sales 100.0 % 100.0 %
Costs of products sales 44.9 % 43.4 %
Costs of services sales 58.4 % 57.0 %
Costs of sales 50.1 % 49.0 %
Gross margin 49.9 % 51.0 %
Selling, general and administrative expenses 14.1 % 15.9 %
Research and development expenditures 7.4 % 8.1 %
Other charges 0.5 % 0.6 %
Intangibles amortization 2.3 % 2.8 %
Operating earnings 25.6 % 23.7 %
Other income (expense):
Interest expense, net (2.0)% (2.3)%
Gains on sales of investments and businesses, net —% —%
Other, net 0.9 % 0.9 %
Total other expense (1.1)% (1.3)%
Net earnings before income taxes 24.5 % 22.3 %
Income tax expense 2.7 % 5.0 %
Net earnings 21.8 % 17.3 %
Less: Earnings attributable to noncontrolling interests —% —%
Net earnings attributable to Motorola Solutions, Inc. 21.8 % 17.3 %
* Percentages may not add up due to rounding

1
 GAAP-2
Motorola Solutions, Inc. and Subsidiaries
Consolidated Statements of Operations
(In millions, except per share amounts)
Years Ended
December 31, 2022 December 31, 2021 December 31, 2020
Net sales from products $ 5,368 $ 4,606 $ 4,087
Net sales from services 3,744 3,565 3,327
Net sales 9,112 8,171 7,414
Costs of products sales 2,595 2,104 1,872
Costs of services sales 2,288 2,027 1,934
Costs of sales 4,883 4,131 3,806
Gross margin 4,229 4,040 3,608
Selling, general and administrative expenses 1,450 1,353 1,293
Research and development expenditures 779 734 686
Other charges 82 50 31
Intangibles amortization 257 236 215
Operating earnings 1,661 1,667 1,383
Other income (expense):
Interest expense, net (226) (208) (220)
Gains (losses) on sales of investments and 3 1 (2)
businesses, net
Other, net 77 92 13
Total other expense (146) (115) (209)
Net earnings before income taxes 1,515 1,552 1,174
Income tax expense 148 302 221
Net earnings 1,367 1,250 953
Less: Earnings attributable to noncontrolling interests 4 5 4
Net earnings attributable to Motorola Solutions, Inc. $ 1,363 $ 1,245 $ 949
Earnings per common share:
Basic: $ 8.14 $ 7.36 $ 5.58
Diluted: $ 7.93 $ 7.17 $ 5.45
Weighted average common shares outstanding:
Basic 167.5 169.2 170.0
Diluted 171.9 173.6 174.1
Percentage of Net Sales*
Net sales from products 58.9 % 56.4 % 55.1 %
Net sales from services 41.1 % 43.6 % 44.9 %
Net sales 100.0 % 100.0 % 100.0 %
Costs of products sales 48.3 % 45.7 % 45.8 %
Costs of services sales 61.1 % 56.9 % 58.1 %
Costs of sales 53.6 % 50.6 % 51.3 %
Gross margin 46.4 % 49.4 % 48.7 %
Selling, general and administrative expenses 15.9 % 16.6 % 17.4 %
Research and development expenditures 8.5 % 9.0 % 9.3 %
Other charges 0.9 % 0.6 % 0.4 %
Intangibles amortization 2.8 % 2.9 % 2.9 %
Operating earnings 18.2 % 20.4 % 18.7 %
Other income (expense):
Interest expense, net (2.5)% (2.5)% (3.0)%
Gains (losses) on sales of investments and —% —% —%
businesses, net
Other, net 0.8 % 1.1 % 0.2 %
Total other expense (1.6)% (1.4)% (2.8)%
Net earnings before income taxes 16.6 % 19.0 % 15.8 %
Income tax expense 1.6 % 3.7 % 3.0 %
Net earnings 15.0 % 15.3 % 12.9 %
Less: Earnings attributable to noncontrolling interests —% 0.1 % 0.1 %
Net earnings attributable to Motorola Solutions, Inc. 15.0 % 15.2 % 12.8 %
* Percentages may not add up due to rounding

2
 GAAP-3
Motorola Solutions, Inc. and Subsidiaries
Consolidated Balance Sheets
(In millions)
December 31, 2022 December 31, 2021
Assets
Cash and cash equivalents $ 1,325 $ 1,874
Accounts receivable, net 1,518 1,386
Contract assets 974 1,105
Inventories, net 1,055 788
Other current assets 383 259
Total current assets 5,255 5,412
Property, plant and equipment, net 927 1,042
Operating lease assets 485 382
Investments 147 209
Deferred income taxes 1,036 916
Goodwill 3,312 2,565
Intangible assets, net 1,342 1,105
Other assets 310 558
Total assets $ 12,814 $ 12,189
Liabilities and Stockholders' Equity (Deficit)
Current portion of long-term debt $ 1 $ 5
Accounts payable 1,062 851
Contract liabilities 1,859 1,650
Accrued liabilities 1,638 1,557
Total current liabilities 4,560 4,063
Long-term debt 6,013 5,688
Operating lease liabilities 419 313
Other liabilities 1,691 2,148
Total Motorola Solutions, Inc. stockholders’ equity (deficit) 116 (40)
Noncontrolling interests 15 17
Total liabilities and stockholders’ equity (deficit) $ 12,814 $ 12,189

3
 GAAP-4

Motorola Solutions, Inc. and Subsidiaries

Consolidated Statements of Cash Flows
(In millions)
Three Months Ended
December 31, 2022 December 31, 2021
Operating
Net earnings $ 590 $ 402
Adjustments to reconcile Net earnings to Net cash provided by operating
activities:
Depreciation and amortization 109 113
Non-cash other charges (income) 4 9
Share-based compensation expense 46 35
Gains on sales of investments and businesses, net — (1)
Changes in assets and liabilities, net of effects of acquisitions, dispositions, and
foreign currency translation adjustments:
Accounts receivable (117) (186)
Inventories 118 (185)
Other current assets and contract assets 37 (69)
Accounts payable, accrued liabilities, and contract liabilities 634 617
Other assets and liabilities (26) (64)
Deferred income taxes (122) 32
Net cash provided by operating activities 1,273 703
Investing
Acquisitions and investments, net (587) (161)
Proceeds from sales of investments 8 12
Capital expenditures (73) (68)
Net cash used for investing activities (652) (217)
Financing
Repayment of debt (2) (2)
Issuances of common stock 19 3
Purchases of common stock (87) (131)
Payment of dividends (132) (120)
Net cash used for financing activities (202) (250)
Effect of exchange rate changes on cash and cash equivalents 84 (15)
Net increase in cash and cash equivalents 503 221
Cash and cash equivalents, beginning of period 822 1,653
Cash and cash equivalents, end of period $ 1,325 $ 1,874

4
 GAAP-5
Motorola Solutions, Inc. and Subsidiaries
Consolidated Statements of Cash Flows
(In millions)
Years Ended
December 31, 2022 December 31, 2021 December 31, 2020
Operating
Net earnings $ 1,367 $ 1,250 $ 953
Adjustments to reconcile Net earnings to Net cash provided by operating
activities:
Depreciation and amortization 440 438 409
Non-cash other charges (income) 23 3 (13)
Loss on ESN fixed asset impairment 147 — —
Share-based compensation expense 172 129 129
Losses (gains) on sales of investments and businesses, net (3) (1) 2
Losses from the extinguishment of long-term debt 6 18 56
Changes in assets and liabilities, net of effects of acquisitions,
dispositions, and foreign currency translation adjustments:
Accounts receivable (112) 3 90
Inventories (242) (284) (14)
Other current assets and contract assets (1) (205) 167
Accounts payable, accrued liabilities, and contract liabilities 451 578 (116)
Other assets and liabilities (91) (126) (25)
Deferred income taxes (334) 34 (25)
Net cash provided by operating activities 1,823 1,837 1,613
Investing
Acquisitions and investments, net (1,177) (521) (287)
Proceeds from sales of investments 46 16 11
Capital expenditures (256) (243) (217)
Proceeds from sales of property, plant and equipment — 6 56
Net cash used for investing activities (1,387) (742) (437)
Financing
Net proceeds from issuance of debt 595 844 892
Repayment of debt (285) (353) (914)
Proceeds from unsecured revolving credit facility draw — — 800
Repayment of unsecured revolving credit facility draw — — (800)
Revolving credit facility renewal fees — (7) —
Issuances of common stock 156 102 108
Purchases of common stock (836) (528) (612)
Payment of dividends (530) (482) (436)
Payment of dividends to noncontrolling interest (6) (5) (4)
Net cash used for financing activities (906) (429) (966)
Effect of exchange rate changes on cash and cash equivalents (79) (46) 43
Net increase (decrease) in cash and cash equivalents (549) 620 253
Cash and cash equivalents, beginning of period 1,874 1,254 1,001
Cash and cash equivalents, end of period $ 1,325 $ 1,874 $ 1,254

5
 Non-GAAP-1
Motorola Solutions, Inc. and Subsidiaries
Reconciliation of Net Cash Provided by Operating Activities to Free Cash Flow
(In millions)

Three Months Ended Years Ended

December 31, December 31, December 31, December 31,
2022 2021 2022 2021
Net cash provided by operating activities $ 1,273 $ 703 $ 1,823 $ 1,837
Capital expenditures (73) (68) (256) (243)
Free cash flow $ 1,200 $ 635 $ 1,567 $ 1,594

6
 Non-GAAP-2
Motorola Solutions, Inc. and Subsidiaries
Reconciliation of Net Earnings Attributable to MSI to Non-GAAP Net Earnings Attributable to MSI
(In millions)

Three Months Ended Years Ended

December December December December
Statement Line 31, 2022 31, 2021 31, 2022 31, 2021
Net earnings attributable to MSI $ 589 $ 401 $ 1,363 $ 1,245
Non-GAAP adjustments before income taxes:
Intangible assets amortization expense Intangibles amortization $ 63 $ 64 $ 257 $ 236
Cost of sales, SG&A and
Share-based compensation expenses R&D 46 35 172 129
Loss on ESN fixed asset impairment Cost of sales — — 147 —
Cost of sales and Other
Reorganization of business charges charges (income) 5 3 36 32
Fair value adjustments to equity investments Other (income) expense (5) 3 30 8
Hytera-related legal expenses SG&A 3 8 28 26
Operating lease asset impairments Other charges (income) 8 3 24 10
Legal settlements Other charges (Income) — — 23 3
Acquisition-related transaction fees Other charges (income) 7 9 23 15
Fixed asset impairments Other charges (income) — — 12 —
Loss from extinguishment of long-term debt Other (income) expense — — 6 18
Investment impairments Other (income) expense — — 1 —
Adjustments to uncertain tax positions Interest income, net (2) (1) (3) (10)
(Gain) or loss on sales of
investments and
Gain on sales of investments businesses, net — (1) (3) (1)
Gain on Hytera legal settlement Other charges (income) (2) — (15) —
Gain on TETRA Ireland equity method investment Other (income) expense — — (21) —
Total Non-GAAP adjustments before income taxes $ 123 $ 123 $ 717 $ 466
Income tax expense on Non-GAAP adjustments 94 27 300 122
Total Non-GAAP adjustments after income taxes 29 96 417 344
Non-GAAP Net earnings attributable to MSI $ 618 $ 497 $ 1,780 $ 1,589

Calculation of Non-GAAP Tax Rate

(In millions)
Three Months Ended Years Ended
December December December December
31, 2022 31, 2021 31, 2022 31, 2021
Net earnings before income taxes $ 663 $ 518 $ 1,515 $ 1,552
Total Non-GAAP adjustments before income taxes* 123 123 717 466
Non-GAAP Net earnings before income taxes 786 641 2,232 2,018
Income tax expense 73 116 148 302
Income tax expense on Non-GAAP adjustments** 94 27 300 122
Total Non-GAAP Income tax expense 167 143 448 424
Non-GAAP Tax rate 21.2 % 22.3 % 20.1 % 21.0 %
*See reconciliation on Non-GAAP-2 table above for detail on Non-GAAP adjustments before income taxes
**Income tax impact of highlighted items

7
 Non-GAAP-2
Reconciliation of Earnings Per Share to Non-GAAP Earnings Per Share*

Three Months Ended Years Ended

December December December December
Statement Line 31, 2022 31, 2021 31, 2022 31, 2021
Net earnings attributable to MSI $ 3.43 $ 2.30 $ 7.93 $ 7.17
Non-GAAP adjustments before income taxes:
Intangible assets amortization expense Intangibles amortization $ 0.36 $ 0.36 $ 1.50 $ 1.36
Cost of sales, SG&A and
Share-based compensation expenses R&D 0.27 0.20 1.00 0.74
Loss on ESN fixed asset impairment Cost of sales — — 0.86 —
Cost of sales and Other
Reorganization of business charges charges (income) 0.03 0.02 0.21 0.18
Fair value adjustments to equity investments Other (income) expense (0.03) 0.02 0.18 0.05
Hytera-related legal expenses SG&A 0.02 0.05 0.16 0.15
Operating lease asset impairments Other charges (income) 0.05 0.02 0.14 0.06
Legal settlements Other charges (Income) — — 0.14 0.02
Acquisition-related transaction fees Other charges (income) 0.04 0.05 0.13 0.09
Fixed asset impairments Other charges (income) — — 0.07 —
Loss from extinguishment of long-term debt Other (income) expense — — 0.03 0.10
Investment impairments Other (income) expense — — 0.01 —
Adjustments to uncertain tax positions Interest income, net (0.01) (0.01) (0.02) (0.06)
(Gain) or loss on sales of
investments and
Gain on sales of investments businesses, net — (0.01) (0.02) (0.01)
Gain on Hytera legal settlement Other charges (income) (0.01) — (0.09) —
Gain on TETRA Ireland equity method investment Other (income) expense — — (0.12) —
Total Non-GAAP adjustments before income taxes $ 0.72 $ 0.70 $ 4.18 $ 2.68
Income tax expense on Non-GAAP adjustments 0.55 0.15 1.75 0.70
Total Non-GAAP adjustments after income taxes 0.17 0.55 2.43 1.98
Non-GAAP Net earnings attributable to MSI $ 3.60 $ 2.85 $ 10.36 $ 9.15

Diluted Weighted Average Common Shares 171.9 174.2 171.9 173.6

*Indicates Non-GAAP Diluted EPS

8
 Non-GAAP-3
Motorola Solutions, Inc. and Subsidiaries
Reconciliations of Operating Earnings to Non-GAAP Operating Earnings and Operating Margin to Non-
GAAP Operating Margin
(In millions)

Three Months Ended

December 31, 2022 December 31, 2021

Products Products
and Software and Software
Systems and Systems and
Integration Services Total Integration Services Total
Net sales $ 1,810 $ 896 $ 2,706 $ 1,495 $ 825 $ 2,320
Operating earnings $ 454 $ 238 $ 692 $ 320 $ 229 $ 549
Above OE non-GAAP adjustments:
Intangible assets amortization expense 15 48 63 15 49 64
Share-based compensation expenses 34 12 46 28 7 35
Operating lease asset impairments 5 3 8 2 1 3
Acquisition-related transaction fees 1 6 7 3 6 9
Reorganization of business charges 4 1 5 3 — 3
Hytera-related legal expenses 3 — 3 8 — 8
Gain on sales of investments — — — (1) — (1)
Gain on Hytera legal settlement (2) — (2) — — —
Total above-OE non-GAAP adjustments 60 70 130 58 63 121
Operating earnings after non-GAAP
adjustments $ 514 $ 308 $ 822 $ 378 $ 292 $ 670

Operating earnings as a percentage of net

sales - GAAP 25.1 % 26.6 % 25.6 % 21.4 % 27.8 % 23.7 %
Operating earnings as a percentage of net
sales - after non-GAAP adjustments 28.4 % 34.4 % 30.4 % 25.3 % 35.4 % 28.9 %

9
 Non-GAAP-4
Motorola Solutions, Inc. and Subsidiaries
Reconciliations of Operating Earnings to Non-GAAP Operating Earnings and Operating Margin to Non-
GAAP Operating Margin
(In millions)

Years Ended
December 31, 2022 December 31, 2021

Products Products
and Software and Software
Systems and Systems and
Integration Services Total Integration Services Total
Net sales $ 5,728 $ 3,384 $ 9,112 $ 5,033 $ 3,138 $ 8,171
Operating earnings ("OE") $ 913 $ 748 $ 1,661 $ 760 $ 907 $ 1,667
Above OE non-GAAP adjustments:
Intangible assets amortization expense 60 197 257 54 182 236
Share-based compensation expenses 126 46 172 99 30 129
Loss on ESN fixed asset impairment — 147 147 — — —
Reorganization of business charges 21 15 36 25 7 32
Hytera-related legal expenses 28 — 28 26 — 26
Operating lease asset impairments 18 6 24 7 3 10
Acquisition-related transaction fees 9 14 23 4 11 15
Legal settlements 3 20 23 2 1 3
Fixed asset impairments 9 3 12 — — —
Gain on Hytera legal settlement (15) — (15) — — —
Gain on sales of investments — — — (1) — (1)
Total above-OE non-GAAP adjustments 259 448 707 216 234 450
Operating earnings after non-GAAP
adjustments $ 1,172 $ 1,196 $ 2,368 $ 976 $ 1,141 $ 2,117

Operating earnings as a percentage of net

sales - GAAP 15.9 % 22.1 % 18.2 % 15.1 % 28.9 % 20.4 %
Operating earnings as a percentage of net
sales - after non-GAAP adjustments 20.5 % 35.3 % 26.0 % 19.4 % 36.4 % 25.9 %

10
 Non-GAAP-5
Motorola Solutions, Inc. and Subsidiaries
Reconciliation of Revenue to Non-GAAP Organic Revenue
(In millions)

Three Months Ended

December 31, 2022 December 31, 2021 % Change
Net sales $ 2,706 $ 2,320 17 %
Non-GAAP adjustments:
Sales from acquisitions 44 5
Organic revenue $ 2,662 $ 2,315 15 %

Years Ended
December 31, 2022 December 31, 2021 % Change
Net sales $ 9,112 $ 8,171 12 %
Non-GAAP adjustments:
Sales from acquisitions 127 6
Organic revenue $ 8,985 $ 8,165 10 %

11