Q1 2026 Motorola Solutions Inc Earnings Call

May 7, 2026

Speaker #1: Good afternoon and thank you for holding. Welcome to the Motorola Solutions First Quarter 2026 earnings conference call. Today's call is being recorded. If you have any objections, please disconnect at this time.

Operator: Good afternoon, and thank you for holding. Welcome to the Motorola Solutions Q1 2026 Earnings Conference Call. Today's call is being recorded. If you have any objections, please disconnect at this time. The presentation material and additional financial tables are posted on the Motorola Solutions investor relations website. In addition, a webcast replay of this call will be available on our website within 3 hours after the conclusion of this call. This website address is www.motorolasolutions.com/investors. All participants have been placed in a listen-only mode. You will have an opportunity to ask questions after today's presentation. If you would like to ask a question, please press star 5 on your telephone keypad to be placed into the queue. You may also press star 5 again to remove yourself from the queue. I would now like to introduce Mr. Brian Piotrowski, Vice President of Investor Relations.

Speaker #1: The presentation material and additional financial tables are posted on the Motorola Solutions Investor Relations website. In addition, a webcast replay of this call will be available on our website within three hours after the conclusion of this call.

Speaker #1: This website address is www.motorolasolutions.com/investors. All participants have been placed in a listen-only mode. You will have an opportunity to ask questions after today's presentation.

Operator: All participants have been placed in a listen-only mode. You will have an opportunity to ask questions after today's presentation. If you would like to ask a question, please press star five on your telephone keypad to be placed into the queue. You may also press star five again to remove yourself from the queue. I would now like to introduce Mr. Brian Piotrowski, Vice President of Investor Relations.

Speaker #1: If you would like to ask a question, please press *5 on your telephone keypad to be placed into the queue. You may also press *5 again to remove yourself from the queue.

Speaker #1: I would now like to introduce Mr. Brian Piotrowski, Vice President of Investor Relations; Mr. Piotrowski, you may begin your conference.

Operator: Mr. Piotrowski, you may begin your conference.

Speaker #2: Good afternoon. Welcome to our 2026 First Quarter earnings call. With me today are Greg Brown, Chairman and CEO; Jason Winkler, Executive Vice President and CFO; Jack Malloy, Executive Vice President and COO; and Mahesh Saptarishi, Executive Vice President and CTO.

Brian Piotrowski: Good afternoon. Welcome to our 2026 Q1 earnings call. With me today are Greg Brown, Chairman and CEO, Jason Winkler, Executive Vice President and CFO, Jack Molloy, Executive Vice President and COO, and Mahesh Saptharishi, Executive Vice President and CTO. Greg and Jason will review our results along with commentary, and Jack and Mahesh will join for Q&A. We have posted an earnings presentation and news release at motorolasolutions.com/investors. These materials include GAAP to non-GAAP reconciliations for your reference. During the call, we reference non-GAAP financial results, including those in our outlook, unless otherwise noted. A number of forward-looking statements will be made during this presentation and during the Q&A portion of the call. These statements are based on current expectations and assumptions that are subject to a variety of risks and uncertainties. Actual results could differ materially from these forward-looking statements.

Speaker #2: Greg and Jason will review our results along with commentary, and Jack and Mahesh will join for Q&A. We have posted an earnings presentation and news release at Motorola Solutions.com/investors.

Speaker #2: These materials include gap-to-non-gap reconciliations for your reference. During the call, we referenced non-gap financial results, including those in our Outlook, unless otherwise noted. A number of forward-looking statements will be made during this presentation and during the Q&A portion of the call.

Speaker #2: These statements are based on current expectations and assumptions that are subject to a variety of risks and uncertainties. Actual results could differ materially from these forward-looking statements.

Speaker #2: Information about factors that could cause such differences can be found in today's earnings and news release, in the comments made during this conference call, in the risk factor section of our 2025 annual report on Form 10-K, or any quarterly report on Form 10-Q, and in our other reports and filings with the SEC.

Brian Piotrowski: Information about factors that could cause such differences can be found in today's earnings news release, in the comments made during this conference call, in the Risk Factors section of our 2025 annual report on Form 10-K or any quarterly report on Form 10-Q, and in our other reports and filings with the SEC. We do not undertake any duty to update any forward-looking statements. I'll now turn the call over to Craig.

Speaker #2: We do not undertake any duty to update any forward-looking statements. I'll now turn the call over to Greg.

Speaker #3: Thanks, Brian. Good afternoon and thanks for joining us today. First, Q1 was an outstanding start to the year with earnings per share that exceeded our guidance as well as record revenue.

Greg Brown: Thanks, Brian. Good afternoon, thanks for joining us today. First, Q1 was an outstanding start to the year, with earnings per share that exceeded our guidance as well as record revenue. Revenue was up 7% in the quarter, highlighted by 18% growth in software and services. Additionally, we saw growth across all three technologies, with particularly strong starts to the year in Command Center and Video, where we continue to see customers adopt our cloud and hybrid solutions to future-proof their operations and leverage our latest purpose-built AI workflows. In terms of Silvus continues to exceed expectations, and I'm very pleased with our continued execution on that front. At a company level, we also expanded year-over-year operating margins for the fifth consecutive quarter. Second, demand for safety and security solutions remains robust.

Speaker #3: Revenue was up 7% in the quarter, highlighted by 18% growth in software and services. Additionally, we saw growth across all three technologies, with particularly strong starts to the year in command center and video where we continue to see customers adopt our cloud and hybrid solutions, to future-proof their operations and leverage our latest purpose-built AI workflows.

Speaker #3: In terms of Silvis, Silvis continues to exceed expectations and I'm very pleased with our continued execution on that front, and it accompany level we also expanded year-over-year operating margins for the fifth consecutive quarter.

Speaker #3: Second, demand for safety and security solutions remains robust. Our record Q1 orders grew 38%, contributing to a record Q1 ending backlog position of 15.7 billion, up 11% versus a year ago.

Greg Brown: Our record Q1 orders grew 38%, contributing to a record Q1 ending backlog position of $15.7 billion, up 11% versus a year ago. This is a testament to the continued prioritization of safety and security by our customers globally and the investments we're making across our ecosystem. During the quarter, we acquired Exacom and Hyper. Exacom integrates critical radio and 911 audio into our digital evidence management, while Hyper injects agentic AI into our 911 call handling. These capabilities convert voice, video, and data into actionable intelligence, helping our customers to act with greater speed and certainty. Additionally, we announced our intent to acquire Bell Canada's LMR Network Services business, which we expect to close sometime in Q4. This acquisition expands our mission-critical managed services footprint into the Canadian public safety customer base.

Speaker #3: This is a testament to the continued prioritization of safety and security by our customers globally and the investments we're making across our ecosystem. During the quarter, we acquired ExeCom and Hyper, ExeCom integrates critical radio and 911 audio into our digital evidence management, while Hyper injects agentic AI into our 911 call handling.

Speaker #3: These capabilities convert voice, video, and data into actual-level intelligence, helping our customers to act with greater speed and certainty. Additionally, we announced our intent to acquire Bell Canada's LMR network services business, which we expect to close sometime in Q4.

Speaker #3: This acquisition expands our mission-critical managed services footprint into the Canadian public safety customer base. And finally, based on our Q1 results and continued momentum in the business, we're raising our full-year guidance for both sales and EPS.

Greg Brown: Finally, based on our Q1 results and continued momentum in the business, we're raising our full-year guidance for both sales and EPS. With that, I'll now turn the call over to Jason.

Speaker #3: And with that, I'll now turn the call over to Jason.

Speaker #2: Thank you, Greg. Revenue for the quarter grew 7% and was above our guidance with growth in both segments and in all three technologies. This included $60 million of FX tailwinds and $219 million from acquisitions, which was consistent with our Q1 expectations.

Jason Winkler: Thank you, Greg. Revenue for Q1 grew 7% and was above our guidance with growth in both segments and in all three technologies. This included $60 million of FX tailwinds and $219 million from acquisitions, which was consistent with our Q1 expectations. GAAP operating earnings were $525 million, or 19.3% of sales, down from 23% in the year-ago Q1, driven by a $75 million non-cash charge for the increase in the Silvus earn-out, which is aligned to stronger performance of the business and increased intangible amortization in the current Q1. Non-GAAP operating earnings were $781 million, up 9% from the year-ago Q1, and non-GAAP operating margin was 28.8%, up 50 basis points, driven by higher sales and improved operating leverage, partially offset by higher supply chain costs.

Speaker #2: Gap operating earnings were $525 million or 19.3% of sales, down from 23% in the year-ago quarter, driven by a $75 million non-cash charge for the increase in the Silvis earn-out, which is aligned to stronger performance of the business and increased intangible amortization in the current quarter.

Speaker #2: Non-gap operating earnings were $781 million up 9% from the year-ago quarter, and non-gap operating margin was 28.8% up 50 basis points, driven by higher sales and improved operating leverage, partially offset by higher supply chain costs.

Speaker #2: Gap earnings per share was $2.18, down from $2.53 in the year-ago quarter, primarily due to the $45 cent non-cash charge for the Silvis earn-out that I mentioned earlier.

Jason Winkler: GAAP earnings per share was $2.18, down from $2.53 in the year-ago quarter, primarily due to the $0.45 non-cash charge for the Silvus earn-out that I mentioned earlier. Non-GAAP EPS was $3.37, up 6% from $3.18 last year. Our growth in EPS was driven by higher operating margins, partially offset by higher interest expense. OpEx in Q1 was $607 million, up $4 million versus last year due to acquisitions. Turning to cash flow, Q1 operating cash flow was $451 million, down $59 million versus last year, and free cash flow was $389 million, down $84 million. The decrease in year-over-year cash flows was primarily driven by increased investments in inventory and higher interest, partially offset by higher earnings.

Speaker #2: Non-gap EPS was $3.37, up 6% from $3.18 last year. Our growth in EPS was driven by higher operating margins, partially offset by higher interest expense.

Speaker #2: OPEX in Q1 was $607 million up $4 million versus last year, due to acquisitions. Turning to cash flow, Q1 operating cash flow was $451 million down 59 million versus last year, and free cash flow was $389 million down 84 million.

Speaker #2: The decrease in year-over-year cash flows was primarily driven by increased investments in inventory and higher interest. Partially offset by higher earnings. Capital allocation during Q1 included $201 million in cash dividends, $118 million in share repurchases, and $62 million of CapEx.

Jason Winkler: Capital allocation during Q1 included $201 million in cash dividends, $118 million in share repurchases, and $62 million of CapEx. We closed two acquisitions during the quarter, Exacom and Hyper, for a total of $90 million net of cash acquired. We also entered into a definitive agreement to acquire the LMR Network Services business from Bell Canada, which is expected to close in Q4 2026. Additionally, the company repaid $200 million of the one and a half billion dollar term loans issued to fund the Silvus acquisition, leaving a balance of $1.3 billion outstanding. Moving next to our segment results. In products and SI, sales were up 1% versus last year, driven by growth in video. Revenue from acquisitions was $181 million, and foreign currency tailwinds were $30 million in the quarter.

Speaker #2: We closed two acquisitions during the quarter: ExeCom and Hyper, for a total of $90 million, net of cash acquired. We also entered into a definitive agreement to acquire the LMR network services business from Bell Canada, which is expected to close in the fourth quarter of 2026.

Speaker #2: Additionally, the company repaid $200 million of the $1.5 billion term loans issued to fund the Silvis acquisition, leaving a balance of $1.3 billion outstanding.

Speaker #2: Moving next to our segment results. In Products and SI, sales were up 1% versus last year, driven by growth in Video. Revenue from acquisitions was $181 million and foreign currency tailwinds were $30 million in the quarter.

Speaker #2: Operating earnings were $386 million or 24.8% of sales, down from 28.1% in the year prior, primarily driven by unfavorable mix and higher supply chain costs.

Jason Winkler: Operating earnings were $386 million, or 24.8% of sales, down from 28.1% in the year prior, primarily driven by unfavorable mix and higher supply chain costs, partially offset by improved operating leverage. Some notable Q1 wins and achievements in the products and SI segment include $148 million P25 device and SVX body-worn assistant orders for the US federal government, a $16 million P25 device order for a US state and local customer, a $14 million fixed video order for a large US fitness company, and a $10 million fixed video order for Duke Energy. During the quarter, the company also secured $78 million of Silvus orders from an unmanned systems provider in Germany with an expected delivery schedule over the next few quarters.

Speaker #2: Partially offset by improved operating leverage. Some notable Q1 wins and achievements in the products and SI segment include $148 million P25 device and SVX body-worn assistant orders, for the US federal government.

Speaker #2: A $16 million P25 device order for a US state and local customer, a $14 million fixed video order for a large US fitness company, and a $10 million fixed video order for Duke Energy.

Speaker #2: During the quarter, the company also secured $78 million of Silvis orders from an unmanned systems provider in Germany, with expected delivery in upcoming quarters. In software and services, revenue was up 18% compared to last year, driven by strong growth across all three technologies.

Jason Winkler: In software and services, revenue was up 18% compared to last year, driven by strong growth across all three technologies. Revenue from acquisitions was $38 million, and currency tailwinds were $30 million in the quarter. Operating earnings in the segment were $395 million, or 34.2% of sales, up from 28.7% last year, driven by higher sales, inclusive of favorable mix and improved operating leverage. Some notable Q1 highlights in this segment include a $41 million 5-year P25 services renewal for the Minnesota Department of Transportation, a $24 million Command Center order for Denver, Colorado, a $16 million Command Center order for Anne Arundel County in Maryland, a $10 million P25 services order for Paraíba, Brazil Department of Social Services, and a $9 million mobile video order for a US state and local customer.

Speaker #2: Revenue from acquisitions was $38 million, and currency tailwinds were $30 million in the quarter. Operating earnings in the segment were $395 million or 34.2% of sales, up from 28.7% last year driven by higher sales inclusive of favorable mix and improved operating leverage.

Speaker #2: Some notable Q1 highlights in this segment include a $41 million five-year P25 services renewal for the Minnesota Department of Transportation, a $24 million command center order for Denver, Colorado, a $16 million command center order for Anne Arundel County in Maryland, a $10 million P25 services order for Pereba Brazil Department of Social Services, and a $9 million mobile video order for a US state and local customer.

Speaker #2: Looking now at our regional results, North America Q1 revenue was $1.9 billion flat compared to the prior year, with growth in video and command center international Q1 revenue was $857 million up 27% versus last year, driven by mission-critical networks video and command center.

Jason Winkler: Looking now at our regional results. North America Q1 revenue was $1.9 billion, flat compared to the prior year, with growth in video and Command Center. International Q1 revenue was $857 million, up 27% versus last year, driven by mission-critical networks, video, and Command Center. Moving to backlog. Ending backlog for Q1 was $15.7 billion, up $1.6 billion or 11% versus last year, primarily driven by record Q1 orders, which was our fourth consecutive quarter of double-digit orders growth in both segments. Sequentially, backlog declined $60 million, driven primarily by revenue recognition for the UK Home Office, partially offset by strong demand in video and Command Center. In products and SI, ending backlog increased $255 million versus last year due to strong demand in video and mission-critical networks.

Speaker #2: Moving to backlog, ending backlog for Q1 was $15.7 billion up 1.6 billion or 11% versus last year, primarily driven by record Q1 orders. Which was our fourth consecutive quarter of double-digit orders growth in both segments.

Speaker #2: Sequentially, backlog declined $60 million driven primarily by revenue recognition for the UK Home Office, partially offset by strong demand in video and command center.

Speaker #2: In products and SI, ending backlog increased $255 million versus last year, due to strong demand in video and mission-critical networks. Sequentially, ending backlog increased $45 million driven by strong demand in video.

Jason Winkler: Sequentially, ending backlog increased $45 million, driven by strong demand in video. In software and services, backlog increased $1.3 billion compared to last year, driven by strong demand for multiyear contracts across all three technologies and favorable foreign currency impacts. Sequentially, the ending backlog declined $105 million, primarily driven by the revenue recognition for the UK Home Office, partially offset by strong demand in Command Center and video. Turning to our outlook. We expect Q2 sales growth of approximately 8.5%, with non-GAAP earnings per share between $3.82 and $3.88 per share. This assumes a weighted average diluted share count of approximately 168 million shares and an effective tax rate of approximately 23%.

Speaker #2: In software and services, backlog increased $1.3 billion compared to last year, driven by strong demand for multi-year contracts across all three technologies and favorable foreign currency impacts.

Speaker #2: Sequentially, the ending backlog declined $105 million primarily driven by the revenue recognition for the UK Home Office, partially offset by strong demand in command center and video.

Speaker #2: Turning to our outlook, we expect Q2 sales growth of approximately 8.5%, with non-gap earnings per share between $3.82 and $3.88 per share. This assumes a weighted average diluted share count of approximately 168 million shares and an effective tax rate of approximately 23%.

Speaker #2: For the full year, we now expect revenue of approximately $12.8 billion up from our prior guidance of $12.7 billion and non-gap earnings per share between $16.87 and $16.99 per share.

Jason Winkler: For the full year, we now expect revenue of approximately $12.8 billion, up from our prior guidance of $12.7 billion, and non-GAAP earnings per share between $16.87 and $16.99 per share, up from our prior guide of between $16.70 and $16.85 per share. This full-year outlook assumes a weighted average diluted share count of approximately 168 million shares, an effective tax rate of approximately 22.5%, and favorable FX of about $100 million, which is unchanged from our prior outlook. Additionally, we continue to expect another strong year of cash flow generation with approximately $3 billion of operating cash flow for the full year. Before turning the call back to Greg, I want to highlight a couple items.

Speaker #2: Up from our prior guide of between $16.70 and $16.85 per share. This full year outlook assumes a weighted average diluted share count of approximately 168 million shares and effective tax rate of approximately 22.5% and favorable FX of about 100 million, which is unchanged from our prior outlook.

Speaker #2: Additionally, we continue to expect another strong year of cash flow generation with approximately $3 billion of operating cash flow for the full year. Before turning the call back to Greg, I want to highlight a couple items.

Speaker #2: First, we are raising our top-line revenue expectations $100 million driven by strength from both Silvis, which we now expect to generate $750 million, in full-year revenue up 75 million from our prior expectations, and as well our core public safety business increasing.

Jason Winkler: First, we are raising our top-line revenue expectations $100 million, driven by strength from both Silvus, which we now expect to generate $750 million in full-year revenue, up $75 million from our prior expectations, and as well our core public safety business increasing. With these increased top-line expectations, we now expect Products and SI to grow between 8% and 9%, up from 7% to 8%, and Mission-Critical Networks, the technology, to grow between 8% and 9%, up from 7% to 8% previously. Second, we continue to navigate a dynamic supply chain environment that includes tariffs and rising memory costs. Regarding tariffs, the Supreme Court ruled against the IEEPA duties in February. However, these were promptly replaced by new Section 122 tariffs, which we're subject to, and a broader tariff framework of uncertainty remains on the horizon.

Speaker #2: With these increased top-line expectations, we now expect products and SI to grow between 8 and 9 percent, up from 7 to 8 percent, and mission-critical networks the technology to grow between 8 and 9 percent, up from 7 to 8 percent previously.

Speaker #2: Second, we continue to navigate a dynamic supply chain environment that includes tariffs and rising memory costs. Regarding tariffs, the Supreme Court ruled against the AIPA duties in February.

Speaker #2: However, these were promptly replaced by new Section 122 tariffs, which we're subject to, and a broader tariff framework of uncertainty remains on the horizon.

Speaker #2: The net impact of these changes is that we continue to project $60 million in tariff headwinds this year, primarily in the first half of the year.

Jason Winkler: The net impact of these changes is that we continue to project $60 million in tariff headwinds this year, primarily in the H1 of the year, and we continue to monitor the IEEPA refund process. Turning to memory. On our last call, we dimensionalized our direct memory spend at approximately $50 million last year. We now expect this to a little more than double in 2026, and we are actively pursuing mitigation strategies, including accelerating inventory, deeper strategic partnerships, and surgical price adjustments to offset these memory cost increases. As a result, we still expect to expand our operating margins by 100 basis points for the full year, with operating margin expansion in both segments. With that, I'd like to turn the call back to Greg.

Speaker #2: And we continue to monitor the AIPA refund process. Turning to memory, on our last call, we dimensionalized our direct memory spend at approximately $50 million last year.

Speaker #2: We now expect this to a little more than double in '26, and we are actively pursuing mitigation strategies, including accelerating inventory, deeper strategic partnerships, and surgical price adjustments to offset these memory cost increases.

Speaker #2: As a result, we still expect to expand our operating margins by 100 basis points for the full year. With operating margin expansion in both segments, with that, I'd like to turn the call back to Greg.

Speaker #1: Thanks, Jason, and I'll end with a few thoughts. First, I'm very pleased with our Q1 results. In demand continues to be quite strong across the portfolio.

Greg Brown: Thanks, Jason, and I'll end with a few thoughts. First, I'm very pleased with our Q1 results, and demand continues to be quite strong across the portfolio. Revenue was up 7%, highlighted by 18% growth in our software and services segment. Additionally, we achieved a record Q1 ending backlog, which was up 11% versus last year, providing us with an excellent foundation for the rest of 2026. Second, I couldn't be more pleased with the energy enthusiasm coming out of our annual Public Safety User Summit, which was held in Orlando last month. Innovation has always been at our core, and after spending time with the record 1,600+ customers in attendance, it's more clear than ever that they're looking to our solutions to help simplify an increasingly complex public safety workflow.

Speaker #1: Revenue was up 7%, highlighted by 18% growth in our software and services segment. Additionally, we achieved a record Q1 ending backlog, which was up 11% versus last year, providing us with an excellent foundation for the rest of 2026.

Speaker #1: Second, I couldn't be more pleased with the energy enthusiasm coming out of our annual public safety user summit, which was held in Orlando last month.

Speaker #1: Innovation has always been at our core, and after spending time with the record 1,600-plus customers in attendance, it's more clear than ever that they're looking to our solutions to help simplify and increasingly complex public safety workflow.

Speaker #1: To that end, I'm excited about the recent launches within our command center that leverage our latest AI-assist capabilities, missions, and record management. With missions, we're redefining crime center operations, by centering workflows around measurable outcomes.

Greg Brown: To that end, I'm excited about the recent launches within our Command Center that leverage our latest AI Assist capabilities, Missions, and Records Management. With Missions, we're redefining crime center operations by centering workflows around measurable outcomes. With Records Management, we're unifying an agency's records and case management into a single cloud-native solution that can significantly accelerate agency reporting and case closure. These solutions build on our comprehensive approach to AI with Assist, focused on injecting intelligence directly into every workflow across the portfolio, serving the call taker, dispatcher, responder, RTCC operator, and investigator with a compelling value proposition for our customers. In Mission Critical Networks, we continue to redefine what resilient communications means. Our new APX NEXT integration with T-Mobile and Starlink seamlessly enables direct-to-device satellite connectivity, adding yet another mode of network resiliency to LMR.

Speaker #1: With records management, we're unifying an agency's records and case management into a single cloud-native solution that can significantly accelerate agency reporting and case closure.

Speaker #1: These solutions build on our comprehensive approach to AI with Assist, focused on injecting intelligence directly into every workflow across the portfolio. Serving the call taker, dispatcher, responder, RTC operator, and investigator with a compelling value proposition for our customers.

Speaker #1: In mission-critical networks, we continue to redefine what resilient communications means. Our new APEX Next integration with T-Mobile and Starlink seamlessly enables direct-to-device satellite connectivity, adding yet another mode of network resiliency to LMR, where we now incorporate LTE, 5G, Wi-Fi, and satellite to help ensure that a first responder is never out of reach.

Jack Molloy: Where we now incorporate LTE, 5G, Wi-Fi, and satellite to help ensure that a first responder is never out of reach. In video security, we also continue to expand the breadth of our portfolio across key verticals, including healthcare, retail, and critical infrastructure. Finally, the opportunities in front of our Silvus business continue to grow in today's geopolitical environment, where unmanned systems, particularly drones, are transforming security and defense operations around the world. The resilient, highly scalable, secure broadband connectivity that Silvus provides puts us at the very center of new defense and electronic warfare communications, and we continue to see strong demand from US and allied defense agencies worldwide, which is in part driving our increased guidance for this year. As I look forward to the rest of the year, I'm absolutely encouraged by our momentum.

Greg Brown: Where we now incorporate LTE, 5G, Wi-Fi, and satellite to help ensure that a first responder is never out of reach. In video security, we also continue to expand the breadth of our portfolio across key verticals, including healthcare, retail, and critical infrastructure. Finally, the opportunities in front of our Silvus business continue to grow in today's geopolitical environment, where unmanned systems, particularly drones, are transforming security and defense operations around the world. The resilient, highly scalable, secure broadband connectivity that Silvus provides puts us at the very center of new defense and electronic warfare communications, and we continue to see strong demand from US and allied defense agencies worldwide, which is in part driving our increased guidance for this year. As I look forward to the rest of the year, I'm absolutely encouraged by our momentum.

Speaker #1: NVIDIA Security, we also continue to expand the breadth of our portfolio across key verticals, including healthcare, retail, and critical infrastructure. And finally, the opportunities in front of our Silvis business continue to grow in today's geopolitical environment.

Speaker #1: We're unmanned systems, particularly drones, are transforming security and defense operations around the world. The resilient, highly scalable, secure broadband connectivity that Silvis provides puts us at the very center of new defense and electronic warfare communications and we continue to see strong demand from U.S.

Speaker #1: and allied defense agencies worldwide which is in part driving our increased guidance for this year. As I look forward to the rest of the year, I'm absolutely encouraged by our momentum.

Speaker #1: We're seeing sustained global prioritization of public safety enterprise security and defense spending and are very well positioned for the remainder of the year. And our strong balance sheet and excellent cash flow provide us with the flexibility to remain opportunistic and capital allocation both organically and inorganically.

Jack Molloy: We're seeing sustained global prioritization of public safety, enterprise security, and defense spending, and are very well-positioned for the remainder of the year. Our strong balance sheet and excellent cash flow provide us with the flexibility to remain opportunistic in capital allocation, both organically and inorganically. With that, I'll turn the call back over to Brian, and we'll open it up for your questions.

Greg Brown: We're seeing sustained global prioritization of public safety, enterprise security, and defense spending, and are very well-positioned for the remainder of the year. Our strong balance sheet and excellent cash flow provide us with the flexibility to remain opportunistic in capital allocation, both organically and inorganically. With that, I'll turn the call back over to Brian, and we'll open it up for your questions.

Speaker #1: And with that, I'll turn the call back over to Brian and we'll open it up for your questions.

Speaker #2: Thank you, Greg. Before we begin taking questions, I would like to remind callers to limit themselves to one question and one follow-up to accommodate as many participants as possible.

Brian Piotrowski: Thank you, Greg. Before we begin taking questions, I would like to remind callers to limit themselves to one question and one follow-up to accommodate as many participants as possible. Operator, would you please remind our callers on the line how to ask a question?

Speaker #2: Operator, would you please remind our callers on the line how to ask a question?

Speaker #3: Thank you. The floor is now open for questions. If you have a question or comment, please press star five on your telephone keypad. If for any reason you would like to remove yourself from the queue, please press star five once again.

Operator: Thank you. The floor is now open for questions. If you have a question or comment, please press star five on your telephone keypad. If for any reason you would like to remove yourself from the queue, please press star five once again. We do ask that while you pose your question, please pick up your handset to provide optimal sound quality. Thank you. Our first question comes from Tim Long with Barclays.

Speaker #3: We do ask that while you pose your question, please pick up your handset to provide optimal sound quality. Thank you. And our first question comes from Tim Long with Barclays.

Speaker #4: Thank you. Yeah, I was hoping I could start with the strong performance in video and command center both those product lines seem to be above growth rate.

Tim Long: Thank you. I was hoping I could start with the strong performance in Video and Command Center. Both those product lines seem to be above growth rate. Could you talk a little bit about what drove that? Was there one-timers in there, particularly in Video, with the big order that was discussed? Any updates on outlooks there? I had a follow-up on mission critical networks after that. Thank you.

Speaker #4: So could you talk a little bit about kind of what drove that? Was there one-timers in there particularly in video with the big order that was discussed?

Speaker #4: And any updates on outlooks there? And then I had a follow-up on mission-critical networks after that. Thank you.

Speaker #5: Thanks, Tim. And yes, it was a strong start to the year for video, as you mentioned, 16% growth. Growth drivers in there include body-worn cameras, ALPR, our Unity platform, and of course, Alta, which is our cloud-based platform continuing to lead the way with growth.

Jack Molloy: Thanks, Tim. Yes, it was a strong start to the year for Video. As you mentioned, 16% growth. Growth drivers in there include body-worn cameras, ALPR, our Unity platform, and of course, Alta, which is our cloud-based platform, continuing to lead the way with growth. Much of that's aligned to the continued investments that Jack's made in the team. I wouldn't point to any one particular deal, a couple of the deals we talked about that are new wins for us, including Duke and the large one that we mentioned for a fitness. Jack, you and your team did a tremendous job on those, and it's pretty broad-based, Tim. The only thing I'd add, I think Jason hit it. The only thing is Alta has been a game changer in terms of vertical market served.

Speaker #5: Much of that's aligned to the continued investments that Jack's made and the team. I wouldn't point to any one particular deal, but a couple of the deals we talked about that are new wins for us including Duke and the large one that we mentioned for a fitness jack you and your team did a tremendous job on those and it's pretty broad-based, Tim.

Speaker #2: Tim, the only thing I think Jason hit, the only thing is Alta has been a game changer in terms of vertical market served. We weren't really in retail before and we alluded to with the big national fitness chain, that's an example I think of what you'll come to expect from us moving forward.

Jack Molloy: You know, we weren't really in retail before, and we alluded to with the big national fitness chain. That's an example, I think of what you'll come to expect from us moving forward. We've been very intensive on education, public safety, critical infrastructure, but I think there's a broader market that we can serve with Alta and with the investments we've made and go to market. The second half of your question, Tim.

Speaker #2: We've been very intensive on education, public safety, critical infrastructure, but I think there's a broader market that we can serve with Alta and with the investments we've made in go-to-market.

Speaker #5: And the second half of your question, Tim.

Speaker #2: Okay.

Tim Long: Okay, thanks.

Speaker #5: Also a strong start to our command center technology. With 27% growth, that was driven in part by some Tier 1 cities coming online for our next-generation 911, which Mahesh and team have delivered.

Jack Molloy: Also, also a strong start to.

Tim Long: Go ahead.

Jack Molloy: our Command Center technology with 27% growth. That was driven in part by some tier 1 cities coming online for our generation 911, which Mahesh and team have delivered. Those customers have made some pretty significant commitments to us given the roadmap that Mahesh has.

Speaker #5: Those customers have made some pretty significant commitments. To us, given the roadmap that Mahesh has, I think on top of that, I'd say that we also moved to a hybrid subscription model for our CAD solutions and our record solutions last year.

Mahesh Saptharishi: I think on top of that, I'd say that we also moved to a hybrid subscription model for our CAD solutions and our record solutions last year. Those customers went live, and we're seeing the dividends of that play out as well at this point. Last thing I'd say is that we introduced Assist Suites last quarter, and we're seeing excellent product market fit there. 100% of our 911 Vesta Next call handling solutions had Dispatcher Assist Suite associated with it. That was a great win for us as well.

Speaker #5: Those customers went live and we're seeing the dividends of that play out as well at this point. The last thing I would say is that we introduced Assist suites last quarter.

Speaker #5: And we're seeing excellent product-market fit there. 100% of our 911 Vesta next call handling solutions had Assist dispatcher suite associated with it. So that was a great win for us as well.

Speaker #5: Okay. And then I just wanted to follow up on the mission-critical networks. It sounds like Silvis is exceeding and you raised numbers there as well.

Tim Long: Okay. I just wanted to follow up on the mission-critical networks. It sounds like, you know, Silvus is exceeding, and you raised numbers there as well. You know, revenues were down year-over-year in the quarter. Maybe talk about, you know, what's going on in the LMR product area to start the year. Thank you.

Speaker #5: Revenues were down year over year in the quarter. So maybe talk about what's going on in the LMR product area to start the year.

Speaker #5: Thank you.

Speaker #4: Sure. So there, Tim, as we expected, where Q1 in particular has a series of comps behind it, our Q1s, pretty strong in the LMR business.

Jack Molloy: Sure. There, Tim Long, it's as we expected, where Q1 in particular has a series of comps behind it. Our Q1 is pretty strong in the LMR business. We were expecting that, prepared for that. Silvus is continuing to exceed our expectations. I would also point you to demand, which is a function of orders. Our double-digit product orders growth, inclusive of LMR, is our Q4 in a row of capturing that level of demand and is anchored around our expectations for growth in the H2 within MCN and LMR inclusive growth to accelerate, which is much like last year.

Speaker #4: And so we were expecting that, prepared for that. Silvis is continuing to exceed our expectations. I would also point you to demand. Which is a function of orders.

Speaker #4: Our double-digit product orders growth, inclusive of LMR, is our fourth quarter in a row of capturing that level of demand and is anchored around our expectations for growth in the second half within MCN and LMR inclusive growth to accelerate, which is much like last year.

Greg Brown: Tim, I would just add and further unpack that. You know, when you decompose products and specifically LMR, remember we're also going against a couple of years prior comps that are double-digit, which is a reflection of the normalization of semiconductor supply that in Q1 and 1 more quarter this quarter, this year, we will be through. That's another anomaly that we're playing through, but love the fact that we've had 4 consecutive orders of double-digit product growth. Quite frankly, we expect full-year double-digit orders growth in products as well. It is as expected. That's a reflection of the linearity you see.

Speaker #2: And Tim, I would just add further unpack that. When you decompose products and specifically LMR, remember we're also going against a couple of years prior comps that are double-digit.

Speaker #2: Which is a reflection of the normalization of semiconductor supply that in Q1 and one more quarter this quarter this year, we will be through.

Speaker #2: So that's another anomaly that we're playing through. But love the fact that we've had four consecutive orders of double-digit product growth. And quite frankly, we expect full year double-digit orders growth in products as well.

Speaker #2: So it is as expected. That's a reflection of the linearity you see.

Speaker #5: And the raise that we mentioned on the call, the 100 million, while 75 million is related to Silvis, the other 25 is from really the public safety business broadly.

Jack Molloy: The raise that we mentioned on the call, the $100 million, while $75 million is related to Silvus, the other $25 million is from really the public safety business broadly. Our expectations have increased.

Speaker #5: So our expectations have increased.

Speaker #4: Okay. Thank you.

Matt Niknam: Okay. Thank you.

Tim Long: Okay. Thank you.

Speaker #2: Thanks, Tim.

Greg Brown: Thanks, Tim.

Speaker #3: The next question will come from the line of Matt Nignam. With true security.

Operator: The next question will come from the line of Matt Niknam with Truist Securities.

Speaker #6: Hey guys, thanks so much for taking the question. I guess to the point of accelerating growth, particularly in the back half of the year, I'm just curious if you can talk to visibility and confidence level you have towards achieving the guide more in terms of supply and getting enough at hand to be able to ship.

Matt Niknam: Hey, guys. Thanks so much for taking the question. I guess to the point of accelerating growth, particularly in the back half of the year, I'm just curious if you can talk to visibility and confidence level you have towards achieving the guide, more in terms of supply and getting enough at hand to be able to ship. On a related note, just on gross margins, I know you guys reaffirmed the expectation to grow op income margins by about 100 basis points. I'm wondering if there's maybe a little bit more leverage against the OpEx or you know, how are you thinking about gross margins relative to scaling past OpEx to get there? Thanks.

Speaker #6: And then on a related note, just on gross margins, I know you guys reaffirmed the expectation to grow up income margins by about 100 basis points.

Speaker #6: I'm wondering if there's maybe a little bit more leverage against the OPEX or how you're thinking about gross margins relative to scaling past OPEX to get there.

Speaker #6: Thanks.

Speaker #4: Sure. So on the demand side, you can see it in our product backlog, which actually increased sequentially. Strong public safety orders as well as strong video orders, included in that.

Jack Molloy: Sure. On the demand side, you can see it in our product backlog, which actually increased sequentially. Strong public safety orders as well as strong video orders included in that. In terms of our ability to continue to attain the supply to match those strong demand profiles, those double-digit quarters that we've talked about, we are getting the supply we need. In some cases, we're having to pay a little bit more for it, in particular memory. Our supply lines are lined up to the demand profile that we have today and what we expect to be there in the H2. Despite the higher costs, we mentioned on the call that we still expect to grow operating earnings for the company 100 basis points and to do it in both segments. Each segment will contribute to that 100 basis point expansion.

Speaker #4: In terms of our ability to continue to attain the supply to match those strong demand profiles, those double-digit quarters that we've talked about, we are getting the supply we need.

Speaker #4: In some cases, we're having to pay a little bit more for it. In particular, memory. But our supply lines are lined up to the demand profile that we have today.

Speaker #4: And what we expect to be there in the second half. And despite the higher costs, we mentioned on the call that we still expect to grow operating earnings for the company 100 basis points and to do it in both segments.

Speaker #4: Each segment will contribute. To that 100 basis point expansion.

Greg Brown: Yeah, and pipeline, Jack-

Speaker #2: And pipeline, Matt, the only thing I'd tell you is given you have a full understanding of public safety being a significant part of our business, it is a long sales cycle in public safety, which is a good thing for us because it gives us visibility in terms of deals of not only deals we propose, but deals approval.

Jack Molloy: Pipeline, Matt, the only thing I'd tell you is, you know, given you have a full understanding of public safety being, you know, a significant part of our business, it is a long sales cycle in public safety, which is a good thing for us because it gives us visibility in terms of not only deals we propose, but deals approval. They go to county board, city commission, and state budget office, we have a high degree of confidence in our outlook for the year.

Speaker #2: They go to county board, city commission, state budget office. And so we have a high degree of confidence in our outlook for the year.

Speaker #3: Thank you. Our next question will come from the line of Joseph Cardoso with JP Morgan. Joseph, your line is open.

Operator: Thank you. Our next question will come from the line of Joseph Cardoso with J.P. Morgan. Joseph, your line is open.

Operator: Thank you. Our next question will come from the line of Joseph Cardoso with JPMorgan. Joseph, your line is open.

Speaker #7: Hey, thanks for the question. Good evening, everyone. Maybe just wanted to circle back on Silvis. It's great to see the upside to the outlook here.

Joseph Cardoso: Hey, thanks for the question. Good evening, everyone. Maybe just wanted to circle back on Silvus. You know, it's great to see the upside to the outlook here. I mean, I'm just wondering if we could take a step back and really just touch on how you guys are seeing the opportunity pipeline build for this business relative to when we last spoke. The second aspect of that question is, as we considered your ability to capture this demand, can you talk about your manufacturing footprint here and how we should think about that as a potential gating factor, if at all, to potential further upside around this business? I have a follow-up. Thank you.

Speaker #7: I mean, I'm just wondering if we could take a step back and really just touch on how you guys are seeing the opportunity pipeline build for this business relative to when we last spoke.

Speaker #7: And then the second aspect of that question is, as we considered your ability to capture this demand, can you talk about your manufacturing footprint here and how we should think about that as a potential gating factor, if at all, to potential further upsides around this business?

Speaker #7: And then I have a follow-up. Thank you.

Speaker #2: Yeah, I think it's since we closed on Silvis in August of last year, as we sit here today, it's definitely exceeding our expectations. I think that what you're seeing and the print in Q1 and the overall guide to 750 million is a reflection of the increased investment that we're making in go-to-market.

Greg Brown: Yeah, I think it's since we closed on Silvus in August 2025, as we sit here today, it's definitely exceeding our expectations. I think that what you're seeing in the print in Q1 and the overall guide to $750 million is a reflection of the increased investment that we're making in go-to-market. The sales force for Silvus is already doubled with Jack and his team making investments. We're seeing demand increase as well internationally. I think when you dimensionalize the $750 million annually, the majority of that is coming from international demand in multiple theaters. When we acquired it, we always thought it was best-in-class technology.

Speaker #2: The sales force for Silvis is already doubled. With Jack and his team making investments, we're seeing demand increase as well internationally. I think when you dimensionalize the 750 million annually, the majority of that is coming from international demand in multiple theaters.

Speaker #2: And when we acquired it, we always thought it was best-in-class technology. The other thing we're doing is putting more calls on the fire on R&D.

Greg Brown: The other thing we're doing is putting more coals on the fire on R&D for differentiation and technology refresh, so we keep that lead and further extend our differentiation.

Speaker #2: For differentiation and technology refresh so we keep that lead and further extend our differentiation.

Speaker #5: Yeah. And just to build on that, Greg, if you think about it, there's really three facets in R&D. Number one, it's a spectrum dominant software, which is ultimately Silvis's secret software.

Jack Molloy: Just to build on that, Greg, if you think about it, there's really three facets in R&D. Number one, it's the spectrum dominant software, which is ultimately Silvus' secret sauce. It's what differentiates us to the other MANET providers in the world of electronic warfare, very critical. The second thing from an R&D standpoint is we've had a big focus on reduction of size, weight, and power. In January, we introduced the StreamCaster MINI 5200, which has gotten rave reviews not only in the DoD but also within the NATO space. That is now our smallest full-featured MANET radio. Then the last thing is the spectrum sensing capability. When you think about counter-UAS, this is a handheld tactical radio at the edge that can sense RF and has spectrum awareness.

Speaker #5: It's what differentiates us to the other Man A providers in the world of electronic warfare. Very critical. The second thing, from an R&D standpoint, is we've had a big focus on reduction of size, weight, and power.

Speaker #5: In January, we introduced the stream caster 5200, which has gotten rave reviews not only in the DOD, but also within the NATO space. And that is now our smallest full-featured Man A radio.

Speaker #5: And then the last thing is a spectrum sensing capability. When you think about counter UAS, this is a handheld tactical radio at the edge.

Speaker #5: That can sense RF and has spectrum awareness. So for the modern war fighter and what's happening in various theaters around the world, it's also being used there.

Jack Molloy: For the modern war fighter and what's happening in various theaters around the world, it's also being used there. We're really pleased. I think the last thing and we talked about investment, Greg nailed the go-to-market, is we have already increased our supply capacity in California. I will you know, we're gonna let you know, we talk we're gonna be adding a geo-redundant site that will bring on incremental capacity in 2027.

Speaker #5: So we're really pleased. And I think the last thing, and we talked about investment, Greg nailed the go-to-market, is we have already increased our supply capacity in California.

Speaker #5: And I will we're going to let you know we're going to be adding a geo-redundant site that will bring on incremental capacity in 2027.

Speaker #5: And the other place you'll see our expectations having increased for Silvis is in the earnout that we structured, which is a win-win. We mentioned on the call that it's gone up to be now an expected payout of just over 100 million.

Jason Winkler: The other place you'll see our expectations having increased for Silvus is in the earn-out that we structured, which is a win-win. We mentioned on the call that it's gone up to be now an expected payout of just over $100 million. That reflects the increase in what we expect the business to perform under the earn-out structure, so aligned there as well.

Speaker #5: That reflects the increase in what we expect the business to perform under the earnout structure. So aligned there as well.

Speaker #7: Yeah, that's awesome color, guys. I appreciate all of that. And then maybe Greg, last quarter, I think you talked about your expectations to expand product backlog, exiting 2026.

Joseph Cardoso: No, that's awesome color, guys. I appreciate all of that. Maybe, Greg, last quarter, I think you talked about your expectations to expand product backlog exiting 2026. I mean, as we sit here today, product backlog is already, you know, at an excellent point for you to execute on that. Maybe just given kind of I mean, you've somewhat already talked about a lot of these or talked about the kind of the demand you are seeing and the momentum in the business. As you sit here today relative to 90 days ago and that expectation around kind of building backlog through the year, you know, how are you feeling, better or worse, you know, in terms of achieving that? Any sense of direction there would be great and kind of the drivers behind it.

Speaker #7: I mean, as we sit here today, product backlog is already kind of excellent point for you to execute on that. So maybe just given kind of I mean, you somewhat already talked about a lot of these or talked about kind of the demands you're seeing and the momentum in the business.

Speaker #7: But as you sit here today relative to 90 days ago and that expectation around kind of building backlog through the year, how are you feeling better or worse in terms of achieving that?

Speaker #7: And any sense of direction there would be great and kind of the drivers behind it.

Greg Brown: From 90 days ago, stronger. Stronger because, as you recall, Joe, I guided last call, I gave color that I actually thought product backlog would decline. It didn't decline, it increased sequentially. It increased because, yes, in part to Silvus, but also public safety LMR and a little bit of video. That was a pleasant surprise that obviously increases the floor. It gives us more confidence. In addition to that, Q1 is not only record backlog but record orders. Between those two records and product backlog coming in stronger than expected, yes, I and we feel better. I think the rhythm of the business is good across the portfolio. You saw the start to video, 16%, Command Center, 27%. We incrementally increased as part of the $100 million $12.7 to $12.8, the guidance around mission-critical networks.

Speaker #2: From 90 days ago, stronger. Stronger because as you recall, Joe, I guided last call, I gave color that I actually thought product backlog would decline.

Speaker #2: It didn't decline. It increased sequentially. And an increase because, yes, in part to Silvis, but also public safety LMR, and a little bit of video.

Speaker #2: So that was a pleasant surprise that obviously increases the floor. It gives us more confidence. In addition to that, Q1 is not only record backlog, but record orders.

Speaker #2: So between those two records and product backlog coming in stronger than expected, yes, I and we feel better. And I think the rhythm of the business is good across the portfolio.

Speaker #2: You saw the start to video, 16% command center, 27%. We incrementally increased as part of the 100 million dollar 12/7 to 12/8. The guidance around mission-critical networks when I think across all three technologies and both segments, Joe, I feel good.

Greg Brown: When I think across all three technologies and both segments, Joe, I feel good. I feel very good about where we are, the pipeline in front of us, and the visibility we have. We have to execute. We'll stay focused on that. Yeah, it was a pleasant surprise, and I think it's a reflection of the durability and longevity of LMR, which is foundational. The ecosystem with AI being connected throughout all product emergency workflows, and we're seeing that resonate with our customers. The Summit feedback was outstanding just a few weeks ago in Orlando. Product backlog end of year, I expect it to be at comparably strong levels from where we are now.

Speaker #2: I feel very good about where we are the pipeline in front of us and the visibility we have. We have to execute. We'll stay focused on that.

Speaker #2: But yeah, it was a pleasant surprise. And I think it's a reflection of the durability and longevity of LMR, which is foundational. The ecosystem with AI being connected throughout all product emergency workflows.

Speaker #2: And we're seeing that resonate with our customers. The summit feedback was outstanding just a few weeks ago. In Orlando. So product backlog end of year, I expect it to be at comparably strong levels from where we are now.

Speaker #7: No, that's great to hear. Thanks for the questions.

Joseph Cardoso: No, that's great to hear. Thanks for the question.

Speaker #2: Thank you.

Greg Brown: Thank you.

Speaker #8: Thank you. Our question now comes from the lineup, Keith, who's somewhat North Coast research. Your line is open.

Operator: Thank you. Our question now comes from the line of Keith Housum with Northcoast Research. Your line is open.

Speaker #5: Good afternoon, guys. Hey, Jason, can you remind me your software and services number? How much of that is recurring revenue? What's the percentage that's recurring?

Keith Housum: Good afternoon, guys. Hey, Jason, can you remind me, your software and services number, how much of that is recurring rev? What's the percentage of it recurring?

Jason Winkler: We view and have asserted that software and services is our proxy for recurring. Sorry, Keith. Really, in our view, the definition of it is it is recurring.

Speaker #4: We view and have asserted that software and services is our proxy for recurring sorry, Keith. So really, in our view, the definition of it is it is recurring.

Speaker #5: Okay. So what we see here is core is really a significant step up year over year. And that will be able to carry that through for the rest of the year.

Keith Housum: Okay. What we see here in this quarter is really a significant step up, year over year, and that will be able to carry that through for the rest of the year, the growth that we're seeing, correct?

Speaker #5: The growth that we're seeing, correct?

Speaker #4: Well, we've got it to SNS performance being a little less than the 18% it started off at. As we mentioned on the command center side, there are some activations that come with a recurring true up.

Jason Winkler: Well, we've guided to SNS performance being a little less than the 18% it started off at. As we mentioned on the Command Center side, there are some activations that come with a recurring true-up. We mentioned those 3 to 4 with tier 1 cities that are large, that were in the Command Centers, Keith. Those are now live, and that was in part what was in the 27% as well as in the 18%. We are very excited about the growth prospect of SNS as we look forward.

Speaker #4: We mentioned those three to four with tier one cities that are large, that were in the command center piece. So those are now live.

Speaker #4: And that was in part what was in the 27%, as well as in the 18%. But we are very excited about the growth prospect of SNS as we look forward.

Speaker #5: Okay. Appreciate that. And then you guys are still expect double-digit growth order growth for the year. I think you always commentary you guys provide the last quarter.

Keith Housum: Okay. Appreciate that. Do you guys still expect double-digit growth, order growth for the year? I think that was the commentary you guys provided last quarter.

Speaker #4: Yep. Yep.

Jason Winkler: Yep. Yep.

Speaker #5: Okay. Great. Thanks, guys. Turn it back over.

Keith Housum: Okay, great. Thanks, guys. Turn it back over.

Speaker #4: Thank you, Keith.

Jason Winkler: Thank you, Keith.

Speaker #8: Our next question comes from Ben Bolen with Cleveland. Your line is open.

Operator: Our next question comes from Ben Bollin with Cleveland Research. Your line is open.

Speaker #2: Thank you. Good afternoon, everyone. I appreciate you taking the question. Greg, I was hoping you could comment or Jack a little bit about what you see happening with the timing of Congress passing funding for DHS.

Ben Bollin: Thank you. Good afternoon, everyone. I appreciate you taking the question. Greg, I was hoping you could comment, or Jack, a little bit about what you see happening with the timing of Congress passing funding for DHS. Any influence on the backlog rev rec during the quarter or how that flows through to the model for the remainder of the year?

Speaker #2: Any influence on the backlog, RevRec, during the quarter, or how that flows through to the model for the remainder of the year?

Speaker #4: Yeah. Ben, no. We're monitoring obviously what's happening in DC. Listen, as it relates to federal, we had a great 2025. We expect growth comparable growth in 2026.

Greg Brown: Yeah. Ben, no, we're monitoring obviously what's happening in DC. Listen, as it relates to federal, we had a great 2025. We expect growth, comparable growth in 2026. You think about it, everybody, all agencies are funded except for ICE and CBP, who basically have a pretty significant budget tailwind through the One Big Beautiful Bill Act, and I think that's important to point out. I would also remind you that we had a $148 million DHS order in Q1 that was funded through the OB3 Act, not only an APX NEXT, but also an SVX order, tethered to that. As we play it forward, we think we're in a great budget situation with the federal government.

Jack Molloy: Yeah. Ben, no, we're monitoring obviously what's happening in DC. Listen, as it relates to federal, we had a great 2025. We expect growth, comparable growth in 2026. You think about it, everybody, all agencies are funded except for ICE and CBP, who basically have a pretty significant budget tailwind through the One Big Beautiful Bill Act, and I think that's important to point out. I would also remind you that we had a $148 million DHS order in Q1 that was funded through the OB3 Act, not only an APX NEXT, but also an SVX order, tethered to that. As we play it forward, we think we're in a great budget situation with the federal government.

Speaker #4: So you think about it, everybody all agencies are funded except for ICE and CBP. Who basically have a pretty significant budget tailwind through the one big beautiful bill act.

Speaker #4: And I think that's important to point out. I would also remind you that we had a $148 million DHS order in Q1 that was funded through the OB3 act.

Speaker #4: Not only an apex next, but also an SVX order tethered to that. So as we play it forward, we think we're in a great budget situation with the federal government.

Speaker #4: We're always monitoring what happens in DC. But we think it's immaterial and we think this it's all implied within our guide for 2026.

Greg Brown: We're always monitoring what happens in DC, but we think it's immaterial, and we think this, it's all implied within our guide for 2026.

Jack Molloy: We're always monitoring what happens in DC, but we think it's immaterial, and we think this, it's all implied within our guide for 2026.

Ben Bollin: A follow-up. When we think about near-term opportunity.

Speaker #5: In a follow-up, when we think about near-term opportunity associated with the World Cup, how should we think about that capture opportunity or the incrementality of that for Q2 and beyond?

Ben Bollin: A follow-up. When we think about near-term opportunity.

Ben Bollin: With World Cup, how should we think about that capture opportunity or the incrementality of that for Q2 and beyond?

Speaker #2: Sure. So we've had so if you're just remind everybody with the World Cup and we're working with all those cities. And we've generated business in all those cities.

Greg Brown: Sure. I'd just remind everybody with the World Cup, and we're working with all those cities, and we've generated business in all those cities. A lot of that, more than half of that money was earmarked for counter-UAS systems that were not in place in the stadiums. With the other monies that were available, we have seen APX NEXT refreshes. We've seen a significant, and this is important, a significant amount of business for us within the SmartConnect. Think about it connecting public safety to private stadium systems. We've had business there. All of that, you know, has been, it's been generally conducive, but it hasn't been a big driver of the business.

Jack Molloy: Sure. I'd just remind everybody with the World Cup, and we're working with all those cities, and we've generated business in all those cities. A lot of that, more than half of that money was earmarked for counter-UAS systems that were not in place in the stadiums. With the other monies that were available, we have seen APX NEXT refreshes. We've seen a significant, and this is important, a significant amount of business for us within the SmartConnect. Think about it connecting public safety to private stadium systems. We've had business there. All of that, you know, has been, it's been generally conducive, but it hasn't been a big driver of the business.

Speaker #2: A lot of that more than half of that money was earmarked for counter UAS systems that were not in place in the stadiums. But with the other monies that were available, we have seen apex next refreshes.

Speaker #2: We've seen a significant and this is important a significant amount of business for us within the smart connect. So think about it connecting public safety to private stadium systems.

Speaker #2: We've had business there. All of that has been it's been generally conducive, but it hasn't been a big driver of the business. In fact, it's been about $40 million all in with the World Cup city sites.

Greg Brown: In fact, it's been about $40 million all in, with the World Cup city sites.

Jack Molloy: In fact, it's been about $40 million all in, with the World Cup city sites.

Speaker #5: Thanks, Jack.

George Notter: Thanks, Jack.

Speaker #8: Thank you. Our next question will be from Andrew Spinola with UBS. Your line is now open.

Operator: Thank you. Our next question will be from Andrew Spinola with UBS. Your line is now open.

Andrew Spinola: Thank you. I think you had another fairly large SVX win this quarter in the press release in your federal business. Wondering if you can just comment on the momentum in the SVX product line and specifically highlight, you know, why you're so bullish on the federal business, what you're seeing there and what that opportunity looks like?

Speaker #9: Thank you. I think it you had another fairly large SVX win this quarter in the press release in your federal business. Wondering if you can just comment on the momentum in that the SVX product line and specifically highlight why you're so bullish on the federal business.

Speaker #9: What you're seeing there, what that opportunity looks like.

Speaker #2: Sure. We've said the market wants an alternative. We're really excited. But I think we're more excited because of the demand signals we're seeing from our customers, to your point.

Greg Brown: Sure. You know, we've said the market wants an alternative. We're really excited, but I think we're more excited because of the demand signals we're seeing from our customers. To your point, we secured a significant DHS order, as I just alluded to with SVX tethered with APX NEXT. To date now, we've seen 100 customers with SVX, and I think the most important metric that we're following is 30% of those customers are utilizing video. We've completed some deployments, namely Arlington, Texas. By the way, that's a World Cup site. Buckeye, Arizona, and Marion County, Florida as well. Playing it forward, we're monitoring weekly the pipeline. We've got hundreds of quotes out to customers that want an alternative and are looking to continue.

Speaker #2: We secured a significant DHS order as I just alluded to with SVX tethered with apex next. But to date now, we've seen 100 customers with SVX.

Speaker #2: And I think the most important metric that we're following is 30% of those customers are utilizing video. We've completed some deployments, namely Arlington, Texas.

Speaker #2: By the way, that's a World Cup site. Buckeye, Arizona, and Marion County, Florida as well. Playing it forward, we're monitoring weekly the pipeline. We've got hundreds of quotes out to customers that want an alternative and they're looking to continue our sales team continues to look to work to seed the device into the marketplace.

Greg Brown: Our sales team continues to look to work to seed the device into the marketplace. Just the 30 customers utilizing video are doing so with AI Assist, and oftentimes, as you know, we're doing it with 1 device, not 2, 'cause it's converged with the bodycam and the remote speaker mic. We're doing it with compelling total cost of ownership, which is much more affordable and attractive. By the way, we're doing it now and can move back-end data pretty easily in a matter of depending upon the size of the repository.

Speaker #5: And just the 30 customers utilizing video are doing so with AI assist. And oftentimes, as you know, we're doing it with one device, not two because it's converged with the bodycam and the remote speaker mic.

Speaker #5: We're doing it with compelling total cost of ownership, which is much more affordable and attractive. And by the way, we're doing it now and can move backend data pretty easily in a matter of depending upon the size of the repository.

Speaker #5: But we can easily switch a customer with the incumbent provider over to Motorola Solutions with SVX and assist and migrate that backend data and all of evidence management since it's owned by the customer.

Greg Brown: We can easily switch a customer with the incumbent provider over to Motorola Solutions with SVX and Assist and migrate that back-end data and all of evidence management, since it's owned by the customer, in a matter of many times weeks and sometimes a couple of months. We are doing it now on a regular basis.

Speaker #5: In a matter of many times weeks and sometimes a couple of months, but we are doing it now on a regular basis. And maybe related to that as well, with narrative assist that's attached to our command central records management platform today.

Mahesh Saptharishi: Maybe related to that as well, with Narrative Assist that's attached to our Command Center records management platform today, just compared to December, we have seen an 800% increase in the number of completed reports that are generated with Assist. The adoption of these technologies has also increased quite dramatically.

Speaker #5: Just compared to December, we have seen an 800% increase in the number of completed reports that are generated with Assist, so the adoption of these technologies has also increased quite dramatically.

Andrew Spinola: Interesting. Just one other question, one follow-up, separate question. Thinking through Q1 to Q2 trends in mission critical on the product side, you know, how should we think about Silvus in general? Obviously, it's in a pretty strong growth ramp. Is there any reason to think that there's, you know, either seasonality from quarter to quarter, or was Q1 stronger? You know, how should we think about modeling that in Q2?

Speaker #9: Interesting. Just one other question, one follow-up separate question. Thinking through Q1 to Q2 trends in mission-critical on the product side, how should we think about Silvus in general?

Speaker #9: Obviously, it's in a pretty strong growth ramp. Is there any reason to think that there's either seasonality from quarter to quarter or was Q1 stronger?

Speaker #9: How should we think about modeling that in Q2?

Speaker #2: Well, I would first say again, demand is strong and orders are strong. We talked about the additional investments in go-to-market and R&D and the capacity expansion that Malloy's team is taking.

Greg Brown: Well, I would first say, you know, again, demand is strong and orders are strong. We talked about the additional investments in go-to-market and R&D and the capacity expansion that Molloy's team is taking. I think when you take a look and step out and look annually, it isn't exactly a linear business. Projects are an important part of this business, which, you know, don't necessarily allow you to take a quarter and just extrapolate times four. We do feel good about the shape of the year. We continue to invest. At the end of the day, as we sit here in May, I consider and we consider the guide prudent, and we'll update you again in August, demand is really strong.

Speaker #2: I think when you take a look and step out and look annually, it isn't exactly a linear business. Projects are an important part of this business, which don't necessarily allow you to take a quarter and just extrapolate times four.

Speaker #2: But we do feel good about the shape of the year. We continue to invest. And at the end of the day, as we sit here in May, it's I consider and we consider the guide prudent.

Speaker #2: And we'll update you again in August. But demand is really strong.

Speaker #9: Thank you.

Andrew Spinola: Thanks.

Speaker #2: Thanks, Andrew.

Greg Brown: Thanks, Andrew.

Speaker #8: Great. Our next question will come from George Matter with Wolf Research. George, your line is open.

Operator: Great. Our next question will come from George Notter with Wolfe Research. George, your line is open.

Speaker #5: Hey, guys. Thanks very much. I was just curious about the backlog metrics look really good. I'm wondering if there's any change in the duration of orders anything that might help kind of skew that backlog metric up.

George Notter: Hey, guys. Thanks very much. I was just curious about the backlog metrics look really good. I'm wondering if there's any change in the duration of orders, you know, anything that might help kind of skew that backlog metric up. I'm just trying to understand how much I can rely on that backlog metric as a gauge for future growth. Thanks.

Speaker #5: I'm just trying to understand how much I can rely on that backlog metric as a gauge for future growth. Thanks.

Greg Brown: No change to where we were positioned on the backlog from this point last year, both in terms of when we expect it to ship, George, but also the duration on things like SNS, which you know is a multi-year. We look at backlog as a function of informing our guide, as well as looking forward to what we will earn in orders quick turn, which is also an important part. Again, much like last year, our setup here as we sit here today is for a strong backlog position complemented by continued strong orders, is what's informing our guide and our raise.

Speaker #2: No change to where we were positioned on the backlog from this point last year, both in terms of when we expected to shift, George, but also the duration on things like SNS, which you know is a multi-year. So we look at backlog as a function of informing our guide as well as looking forward to what we will earn in orders—quick turn, which is also an important part.

Speaker #2: And again, much like last year, our setup here as we sit here today is for a strong backlog position complemented by continued strong orders is what's informing our guide and our raise.

Speaker #5: Okay. Super. That's great. And then one other one—I was just curious about the Bell Canada LMR acquisition. Any sense for what that would look like financially?

George Notter: Okay, super. That's great. Then one other one. I was just curious about the Bell Canada LMR acquisition. Any sense for what that would look like financially? Is it accretive? How much revenue would that drive? Anything else you can tell us there would be great.

Speaker #5: Is it accretive? How much revenue would that drive? Anything else you can tell us there would be great.

Speaker #2: Well, it's about it'll bring to us approximately $100 million of the recurring services managed services operations, which you know that we do elsewhere across the globe.

Mahesh Saptharishi: Well, it'll bring to us approximately $100 million of the recurring services, managed services, operations, which you know that we do elsewhere across the globe. It's a number of underlying customers. There's potential to serve those customers better and deeper in other areas. The starting point is the $100 million of recurring managed services business, which and again, we expect to close that in Q4. We'll have some more details on that as we close.

Greg Brown: Well, it'll bring to us approximately $100 million of the recurring services, managed services, operations, which you know that we do elsewhere across the globe. It's a number of underlying customers. There's potential to serve those customers better and deeper in other areas. The starting point is the $100 million of recurring managed services business, which and again, we expect to close that in Q4. We'll have some more details on that as we close.

Speaker #2: It's a number of underlying customers. There's potential to serve those customers better and deeper in other areas. But the starting point is the $100 million of recurring managed services business, which again and again, we expect to close that in Q4.

Speaker #2: We'll have some more details on that as we close.

Speaker #5: And the next thing. Thanks a lot. Appreciate it.

George Notter: Thanks. Appreciate it.

Speaker #8: Thank you. Our question now comes from Meta Marshall with Morgan Stanley. Your line is now open. Great. Thanks so much. Appreciate the question. Just maybe a question just in terms of kind of what was driving some of the strength that you saw in video in the quarter.

Operator: Thank you. Our question now comes from Meta Marshall with Morgan Stanley. Your line is now open.

Meta Marshall: Great. Thanks so much. Appreciate the question. Just maybe a question just in terms of kind of what was driving some of the strength that you saw in video in the quarter, that would be helpful, and maybe as a starting point.

Speaker #8: That would be helpful. And maybe as a starting point.

Speaker #5: As I mentioned earlier, Meta we're pleased with our video performance. Both in orders and sales. We had strong camera sales which you can see in the product number.

Mahesh Saptharishi: As I mentioned earlier, Meta, we're pleased with our video performance, both in orders and sales. We had strong camera sales, which you can see in the products number. We had strong Unity sales. And SVX, which we mentioned, and Jack highlighted some of those deals, is a driver as well. Overall strong performance in video, to start the year.

Speaker #5: We had strong unity sales and SDX, which we mentioned in Jack highlighted some of those deals. It is a driver as well. So overall, strong performance in video.

Speaker #5: To start the year.

Speaker #8: Got it. And then just and apologies if this has already been asked. Just in terms of kind of thinking about LMR product for the remainder of the year, just in terms of kind of now that we're past some of the tougher comps, just how to think about that.

Meta Marshall: Got it. Then just, and apologies if this has already been asked, just in terms of kind of thinking about LMR product for the remainder of the year, just in terms of kind of, you know, now that we're past some of the tougher comps, just how to think about that. Thanks.

Speaker #8: Thanks.

Speaker #2: Yeah. We talked about some of the double-digit comps from previous Q1s of a couple of years. I think to this quarter and probably Meta next quarter as well, next quarter will complete what we believe is the normalization post-semiconductor supply.

Greg Brown: Yeah. We talked about some of the double-digit comps from previous Q1s of a couple of years. I think to this quarter, and probably, Meta, next quarter as well, next quarter will complete what we believe is the normalization post semiconductors supply. We expect more robust growth in the H2 of the year. When you think about organic growth, primarily grounded in Mission-Critical Networks and LMR, we expect it to be stronger annually for the full year 2026 over 2025, and we like the double-digit orders for product and the pipeline that Jack's team continues to provide. I feel very good about the position of Mission-Critical Networks and specifically LMR underneath it.

Speaker #2: So we expect more robust growth in the back half of the year. And when you think about organic growth, primarily grounded in mission-critical networks and LMR, we expect it to be stronger annually for the full year.

Speaker #2: 26 over 25. And we like the double-digit orders for product and the pipeline that Jack's team continues to provide. So I feel very good about the position of mission-critical networks, and specifically LMR underneath it.

Speaker #8: Great. Thanks so much.

Meta Marshall: Great. Thanks so much.

Speaker #2: Thank you.

Greg Brown: Thank you.

Speaker #8: Our next question comes from a line of Telmer Zillerman with Bank of America Securities. Your line is open.

Operator: Our next question comes from the line of Tomer Zilberman with Bank of America Securities. Your line is open.

Speaker #10: Hey, guys. Maybe another question on the competitive landscape. Axon announced that they're entering the 911 call center market through two acquisitions. I think that was just about a month ago.

Tomer Zilberman: Hey, guys. maybe another question on the competitive landscape. Axon announced that they're entering the 911 call center markets through 2 acquisitions. I think that was just about a month ago. I guess the question really is, how do you see that landscape of Command Center evolving and is there any concerns that they're gonna be a lot more competitive, given you kind of already interact with them in the mobile body-worn camera market?

Speaker #10: So I guess the question really is, how do you see that landscape of command center evolving? And is there any concerns that there are going to be a lot more competitive given you kind of already interact with them in the mobile body-worn camera market?

Speaker #2: Well, I mean, we could tag team it, but my view is to date, we haven't seen a material change in the competitive landscape. I'm well aware of what they announced and suffice to say that we had visibility and opportunities as well.

Greg Brown: Well, I mean, we could tag team it, but my view is to date, we haven't seen a material change in the competitive landscape. I'm well aware of what they announced, suffice to say that, you know, we had visibility and opportunities as well, but we like what we have. We like what we're building. We like the fact that we're in over 60% of the 6,000 public safety answering points today. We like the fact that we have the widest and broadest portfolio. Remember, you wanna do prem, you can do prem. You wanna do cloud, you can do cloud. We also not just do both, we give you a hybrid solution to allow you to migrate from one to the other. That's unique in the market, no one else provides that.

Speaker #2: But we like what we have. We like what we're building. We like the fact that we're in over 60% of the 6,000 public safety answering points today.

Speaker #2: And we like the fact that we have the widest and broadest portfolio. Remember, we want to do prem. You could do prem. You want to do cloud.

Speaker #2: You can do cloud. But we also not just do both. We give you a hybrid solution to allow you to migrate from one to the other.

Speaker #2: That's unique in the market. And no one else provides that. And then when you overlay AI assist and a lot of people talk about AI, but we've been more quiet.

Greg Brown: When you overlay AI Assist, and a lot of people talk about AI, but we've been more quiet, but pretty pervasively intentional of putting it throughout our portfolio into the role-based suites. We announced Responder, we announced Dispatcher. Just think about the way Mahesh's team is embedding AI through all of public safety emergency workflow. When you look at it from a voice standpoint and the success we've had with SVX, and video being activated with Assist in a little over 30% of those, I very much like the position we're in.

Speaker #2: But pretty pervasively intentional of putting it throughout our portfolio into the role-based suites. We announced Responder. We announced Dispatcher. Just think about the way Mahesh's team is embedding AI through all of public safety emergency workflow.

Speaker #2: And then when you look at it from a voice standpoint and the success we've had with SVX, and video being activated with assist and a little over 30% of those, I'd very much like the position we're in.

Speaker #5: The other thing to emphasize here, Telmer, is that we're not just an over-the-top solution here. Remember, a PSAP has three significant applications. There's 911.

Mahesh Saptharishi: The other thing to emphasize here, Tomer, is that we're not just a over-the-top solution here. Remember, a PSAP has 3 significant applications. There's 911, there's CAD, and there are consoles. One of the things we're doing with Assist, which is encompassed in the Dispatcher Suite, is to address the connectivity via AI among those 3. As I mentioned before, every one of our Vesta Next sales last quarter went with the Assist Dispatcher Suite. That's a very important element of it. The other thing I'll say is that at Summit this year, we had a record number of attendees.

Speaker #5: There's CAD, and there are consoles. And one of the things we're doing with Assist, which is encompassing the Dispatcher Suite, is to address the connectivity via AI among those three. And, as I mentioned before, every one of our Best-to-Next sales last quarter went with the Assist Dispatcher Suite.

Speaker #5: So that's a very important element of it. The other thing I'll say is that at Summit this year, we had a record number of attendees.

Speaker #5: We had double the number of AI breakout sessions that we had previously. And it was centered around really pushing the notion of the connectivity that assist brings to bear across our applications almost exactly like Greg explained.

Mahesh Saptharishi: We had double the number of AI breakout sessions that we had previously. It was centered around really pushing the notion of the connectivity that Assist brings to bear across our applications, almost exactly like Greg explained. We also introduced Hyper at Summit. Hyper was received incredibly well, bringing non-emergency call automation into the mix. Hyper is also now tightly integrated with our 911 solutions as well. When you think about it, Assist and AI is not just an over-the-top thing for us, it is really the fabric with which our applications and our ecosystem function together. I think we're competitively set up quite well.

Speaker #5: We also introduced HYPER at Summit. And HYPER was received incredibly well, bringing non-emergency call automation into the mix. And HYPER is also now tightly integrated with our 911 solutions as well.

Speaker #5: So when you think about it, assist and AI is not just an over-the-top thing for us. It is really the fabric with which our applications and our ecosystem function together.

Speaker #5: So I think we're competitively set up quite well.

Speaker #10: Got it. Thanks.

Tomer Zilberman: Got it. Thanks.

Speaker #11: Thanks, Telmer.

Greg Brown: Thanks, Tilman.

Speaker #8: Once again, if you have a question, you may press star five on your telephone keypad. Our next question will come from Ryan Abbott with Piper Sandler.

Operator: Once again, if you have a question, you may press star five on your telephone keypad. Our next question will come from Ryan Abbott with Piper Sandler.

Speaker #12: Hi, guys. Thanks for taking my question. I'm on for Jim Fish. The first question is, on the SVX wins, what are customers liking? What's driving those wins?

Ryan Abbott: Hi, guys. Thanks for taking my question. I'm on for Jim Fish. The first question is on the SVX wins, what are customers liking? Like, what's driving those wins and what does the pipeline look like going forward? I have a follow-up to that.

Speaker #12: And what is the pipeline look like going forward? I have a follow-up to that.

Speaker #2: Yeah. I'll start. I think, Ryan, what we've seen customers like first of all, I think there's it's a multi-source body-worn AI-driven assistant. It's not a body-worn camera.

Greg Brown: Yeah, I'll start. I think, Ryan, what we've seen, customers. First of all, I think it's a multi-source body-worn AI-driven assistant. It's not a body-worn camera. It looks at, I think as Mahesh just laid out, we look at things end-to-end. It extracts video from the Command Center. There's better knowledge base that's provisioned to a police officer when they get on the site. It's that. I think we can't. You can never walk away from the fact that just the audio, which blew me away, has blown the customers away when they look at it in terms of voice and just what that means to the device too.

Speaker #2: It looks at, I think, as Mahesh just laid out, we look at things end to end. It extracts video from the command center. There's better knowledge base that's provisioned to a police officer when they get on the site.

Speaker #2: And so it's that. But I think we can't you can never walk away from the fact that just the audio which blew me away has blown the customers away when they look at it in terms of voice and just what that means to the device too.

Speaker #2: The last piece of it that I would say is when we're talking to people making financial decisions, is no longer it's not you don't need two cell phone bills.

Greg Brown: The last piece of it that I would say is when we're talking to people making financial decisions, you don't need two cell phone bills. I think you're getting more and more value from the hub at the edge, which is the APX radio, and I think that's the economic value that it provides as well.

Speaker #2: I think you're getting more and more value from the hub at the edge, which is the apex radio. And I think that's the economic value that it provides as well.

Speaker #5: Maybe a few things just on the technical side to add there. Quite a few of radio users use earpieces. And when you use the earpiece, the body-worn camera if it's separate and distinct from the radio system itself does not capture that audio.

Mahesh Saptharishi: Maybe a few things, just on the technical side to add there. Quite a few of radio users use earpieces. When you use the earpiece, the body-worn camera, if it's separate and distinct from the radio system itself, does not capture that audio. It is a significant contributor to what an officer sees and hears, which feeds into our Narrative Assist and other AI functionality. The SVX actually combines all of that together. In addition, from a connectivity standpoint, we leverage not just, we don't need a separate connectivity piece in the body-worn camera, the body-worn assistant. It is tied to our APX NEXT unit. The TCO advantage there is quite significant as well. We see this as an incredibly powerful solution.

Speaker #5: It is a significant contributor to what an officer sees and hears, which feeds into our assisted narrative and other AI functionality. The SVX actually combines all of that together.

Speaker #5: In addition, from a connectivity standpoint, we leverage—not just, we don't need a separate connectivity piece in the body-worn camera, the body-worn assistant. It is tied to our APX NEXT unit.

Speaker #5: So the TCO advantage there is quite significant as well. So we see this as an incredibly powerful solution. And last but not least, on the digital evidence management side, our redaction solution assisted with AI has been powerful.

Mahesh Saptharishi: Last but not least, on the digital evidence management aside, our redaction solution assisted with AI has been powerful. Our customers love it. The speed with which you can redact is incredible. We often hear what used to take 35 hours before now takes 1 hour. That's a significant advantage for our customers. The time saving is powerful. I think the user experience all in all is very compelling for SVX.

Speaker #5: Our customers love it. The speed with which you can redact is incredible. We often hear what used to take 35 hours before now takes one hour.

Speaker #5: And that's a significant advantage for our customers. The time saving is powerful. I think the user experience, all in all, is very compelling for SVX.

Speaker #12: Great, thank you. And then on Silvus margins, are they still about in the 40 percent-ish range? And what should we see flowing through to next year?

Ryan Abbott: Great. Thank you. On Silvus margins, are they still about in the 40%-ish range, and what should we see flowing through to next year?

Greg Brown: We talked about EBITDA margins of about 45% for this year. Yes, Silvus is performing at that level, actually at the moment, perhaps a little bit stronger, and that's after the investments we've made in R&D and go-to-market. Particularly pleased about its not only top-line growth and robust orders, but the maintenance and continuity, the profitability profile that it's supporting itself as well.

Speaker #2: We talked about EBITDA margins of about 45% for this year. Yes, Silvus is performing at that level. Actually, at the moment, perhaps a little bit stronger.

Speaker #2: And that's after the investments we've made in R&D and go-to-market. So particularly pleased about its not only top-line growth and robust orders, but the maintenance and continuity of the profitability profile that it's affording itself as well.

Ryan Abbott: Great. Thank you.

Speaker #2: Thank you, Ryan.

Greg Brown: Thank you, Ryan.

Speaker #8: Thank you. Our final question will come from Amit Daryanani. Your line is open. With Evercore ISI.

Operator: Thank you. Our final question will come from Amit Daryanani. Your line is open with Evercore ISI.

Amit Daryanani: I guess, you know, you've announced the Axon and Hyper as well as the Bell Canada. I guess, how are you guys thinking about using M&A the rest of the year to address any more competitive gaps? How are you trying to balance that versus continuing organic R&D investment? Thank you.

Speaker #13: I guess you ou announced the Exxon and HYPER as well as the Bell Canada. I guess, how are you guys thinking about using M&A the rest of the year to address any more competitive gaps?

Speaker #13: And then how are you trying to balance that versus continuing organic R&D investment? Thank you.

Speaker #2: Well, the good news is the balance sheet position we're in is really strong. And we reaffirmed, obviously, today our expectation to generate approximately $3 billion in operating cash flow.

Greg Brown: Well, the good news is, the balance sheet position we're in is really strong. We reaffirmed, obviously today, our expectation to generate approximately $3 billion in operating cash flow. You know that, when you think about CapEx, the dividend and M&A, it's about 60, 30, 10. 60% we can do share repo, 30% dividend, 10% CapEx. I think we are sitting in a position. We bought back $118 million of shares in Q1. As we sit here today, there's just under $250 million of share buyback to date. A lot of flexibility ahead, both inorganically and organically.

Speaker #2: You know that when you think about CapEx the dividend and M&A it's about 60/30/10. 60% we can do share repo. 30% dividend. 10% CapEx.

Speaker #2: So, I think we are sitting in a position—we've purchased, we bought back 118 million of shares in Q1 as we sit here today.

Speaker #2: Just under 250 million. Of share buyback to date. But a lot of flexibility ahead, both inorganically and organically. I think the investments we're making in the product portfolio command center, video, fixed, prem, mobile, hybrid, cloud, as well as Silvus, as well as LMR on D-Series, infrastructure refresh, first time we've done that in over a dozen years.

Greg Brown: I think the investments we're making in the product portfolio, Command Center, video, fixed, prem, mobile, hybrid, cloud, as well as Silvus, as well as LMR on D-Series infrastructure refresh. First time we've done that in over a dozen years. The continued device refresh, the network layered resiliency. We have a lot of opportunity in front of us and good optionality would net that to EBITDA sitting a little over 2. I think we have a lot of powder, and I think we have a lot of opportunity. I don't think we have any quote-unquote gaps per se. Bell Canada being a great example. That's an extension of a core business that expands the Canadian public safety footprint. That's core of what we do. We know how to monetize services. We know how to upgrade the infrastructure.

Speaker #2: The continued device refresh, the network layered resiliency, we have a lot of opportunity in front of us. And good optionality would net that to EBITDA sitting a little over $2.

Speaker #2: So I think we have a lot of powder. And I think we have a lot of opportunity. I don't think we have any "gaps" per se.

Speaker #2: Bell Canada being a great example. That's an extension of a core business that expands the Canadian public safety footprint—that's core of what we do.

Speaker #2: We know how to monetize services. We know how to upgrade the infrastructure. We know how to device do device refresh. And we know how to load applications on that P25 infrastructure and device footprint over time.

Greg Brown: We know how to do device refresh, and we know how to load applications on that P25 infrastructure and device footprint over time. We'll see how it unfolds, but there's a lot of flexibility and optionality that's in front of us from here looking to the rest of the year.

Speaker #2: So we'll see how it unfolds. But there's a lot of flexibility and optionality that's in front of us from here looking to the rest of the year.

Speaker #8: Thank you. This concludes our question and answer session. I will now turn the floor over to Mr. Greg Brown, Chairman and Chief Executive Officer for any additional comments or closing remarks.

Operator: Thank you. This concludes our question-and-answer session. I will now turn the floor over to Mr. Greg Brown, Chairman and Chief Executive Officer, for any additional comments or closing remarks.

Speaker #2: Yeah. I simply want to say thank you. To all the Motorola and our partners for a great start to the year. I think we're really well positioned to execute on the increased expectations we outlined on the call.

Greg Brown: I simply want to say thank you to all the Motorolans and our partners for a great start to the year. I think we're really well-positioned to execute on the increased expectations we outlined on the call. We just see continued strong, robust demand, not just in a strong pipeline, but again, coming out of Q1, record backlog, fantastic order performance, and we like the portfolio investments we're making that are clearly resonating with customers, as Mahesh referenced just a few weeks ago with one of the best testimonials there with almost 2,000 people in Orlando. We've got a strong balance sheet, strong and robust cash generation, and a lot of flexibility and opportunity in front. Excited about what's next and look forward to catching up with all of you on the next call in August. Thanks for dialing in.

Speaker #2: We just see continued strong robust demand. Not just in a strong pipeline. But again, coming out of Q1, record backlog. Fantastic order performance. And we like the portfolio investments making that are clearly resonating with customers.

Speaker #2: As Mahesh referenced just a few weeks ago with one of the best testimonials there with almost 2,000 people in Orlando. We've got a strong balance sheet strong and robust cash generation and a lot of flexibility and opportunity in front.

Speaker #2: So excited about what's next and look forward to catching up with all of you on the next call in August. Thanks for dialing in.

Operator: This does conclude today's teleconference. A replay of this call will be available over the internet within 3 hours. The website address is www.motorolasolutions.com/investors. We thank you for your participation and ask that you please disconnect your lines at this time.

Speaker #8: This does conclude today's teleconference. A replay of this call will be available over the internet within three hours. The website address is www.motorolasolutions.com/investors. We thank you for your participation and ask that you please disconnect your lines at this time.