01—Abstract
Summary
Summary of the 10-K filed February 16, 2022. Cited figures are marked; the original filing is the authoritative source.
Motorola Solutions, Inc. (MSI) reported strong financial performance for the fiscal year ending December 30, 2021, with net sales increasing by 10% to $8.2 billiona and operating earnings rising by 21% to $1.7 billion.
This growth was driven by robust demand across both its "Products and Systems Integration" and "Software and Services" segments, with particular strength noted in LMR Communications, Video Security and Access Control, and Command Center Software. The company demonstrated effective capital allocation, returning over $1 billionb to shareholders through share repurchases and dividends. The backlog also saw a significant increase, reaching $13.6 billion, indicating strong future revenue potential.
MSI continues to invest in research and development and strategic acquisitions to enhance its integrated technology ecosystem, focusing on public safety and enterprise security solutions. Despite ongoing supply chain challenges, particularly in semiconductors, the company expressed confidence in its growth trajectory and ability to meet customer demand.
02—Key points
Key Highlights
- Net sales increased by 10% to $8.2 billion in 2021, driven by strong performance across both operating segments.
- Operating earnings saw a significant increase of 21% to $1.7 billion, demonstrating improved profitability.
- The company returned over $1.0 billion to shareholders via share repurchases ($528 million) and dividends ($482 million) in 2021.
- Backlog increased by $2.2 billion to $13.6 billion, signaling strong future revenue prospects.
- Investments in R&D totaled $734 million, underscoring the company's commitment to innovation in its core technologies.
- The company completed multiple strategic acquisitions in 2021, including Envysion, Openpath, and 911 Datamaster, to bolster its offerings in video security, access control, and command center software.
- Despite supply chain constraints, particularly in semiconductors, the company anticipates continued growth, supported by government stimulus funding (ARPA).
03—One dollar
Follow one dollar
Of each $1.00 of revenue in FY2021, Motorola Solutions, Inc. kept $0.15.
- Revenue$8.17B100.0%
- Cost of revenue−$4.13B50.6%
- Gross profit$4.04B49.4%
- Operating costs−$2.37B29.0%
- Operating income$1.67B20.4%
- Interest, other & tax−$422.0M5.2%
- Net income$1.25B15.2%
Where FY2021 revenue went
$8.17B- Cost of revenue: $4.13B, 51% of revenue
- SG&A: $1.35B, 17% of revenue
- Net income: $1.25B, 15% of revenue
- R&D: $734.0M, 9.0% of revenue
- Other operating costs: $286.0M, 3.5% of revenue
- Interest, other & tax: $422.0M, 5.2% of revenue
Kept 15% as net income
Full revenue history →04—Financials
Financial Highlights
Figures from 10-KFY2021filed February 16, 2022Financial Statements
FY2021 against FY2020
| Line item | FY2021FY2020 | Change |
|---|---|---|
| Revenue | $8.17B$7.41B | +10.2% |
| Cost of Revenue | $4.13B$3.81B | +8.5% |
| Gross Profit | $4.04B$3.61B | +12.0% |
| R&D Expenses | $734.00M$686.00M | +7.0% |
| SG&A Expenses | $1.35B$1.29B | +4.6% |
| Operating Income | $1.67B$1.38B | +20.5% |
| Interest Expense | $215.00M$233.00M | −7.7% |
| Net Income | $1.25B$949.00M | +31.2% |
| EPS (Basic) | $7.36$5.58 | +31.9% |
| EPS (Diluted) | $7.17$5.45 | +31.6% |
| Shares Outstanding (Basic) | 169.20M170.00M | −0.5% |
| Shares Outstanding (Diluted) | 173.60M174.10M | −0.3% |
05—Questions
Frequently Asked Questions
What were the primary drivers of Motorola Solutions' revenue growth in 2021?
Revenue growth was primarily driven by increased demand across both the Products and Systems Integration segment and the Software and Services segment. Key contributing product lines included LMR Communications, Video Security and Access Control, and Command Center Software. Acquisitions also contributed to the revenue increase.
How is Motorola Solutions addressing supply chain challenges, particularly in the semiconductor market?
Motorola Solutions is actively monitoring its supply chain and maintaining close communication with key suppliers. They are developing mitigation plans and exploring alternative sourcing for semiconductor components. While acknowledging these challenges may impact the ability to meet demand in 2022, they are working to prevent major delays.
What is Motorola Solutions' strategy regarding acquisitions and integration?
Motorola Solutions strategically invests in acquisitions to expand its technology portfolio and enhance its integrated ecosystem. The company aims to unite voice, software, video security, and access control solutions to create a unified system. Recent acquisitions in 2021 focused on strengthening capabilities in video security, access control, and command center software, with an emphasis on integrating these technologies to offer end-to-end public safety and enterprise security solutions.
How does Motorola Solutions return capital to shareholders?
Motorola Solutions returns capital to shareholders through a combination of share repurchases and dividend payments. In 2021, the company repurchased $528 million of its stock and paid $482 million in dividends. The company also increased its quarterly dividend by 11% to $0.79 per share in November 2021, and has $2.1 billion of authority remaining under its share repurchase program.
06—Continue