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Speaker 1: Bloomberg Audio Studios, podcasts, radio news.

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Speaker 2: One of their software watching is Motorola Solutions. It is

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Speaker 2: one of the best performing tech stocks in the SMP

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Speaker 2: this year. Shares are up roughly fifty five percent, driven

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Speaker 2: in part by a shift from hardware to software and services. Now,

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Speaker 2: remember Motorola Solutions makes things like bodycams, public safety walkie talkies,

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Speaker 2: that kind of stuff. Here in studio with more on

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Speaker 2: this is Greg Brown, chairman and CEO of Motorola Solutions.

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Speaker 1: Greg, it's great to see you, Thanks for having me.

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Speaker 2: So how is this transition going? Like it's really about

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Speaker 2: services and software at a hardware better margin. How do

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Speaker 2: you see that happening over the next year.

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Speaker 3: Well, so take a step back. We just printed a

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Speaker 3: great Q three. We had record orders across all three technologies.

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Speaker 3: Forget about hardware and software for a minute and think

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Speaker 3: of it about public safety and enterprise security. So we

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Speaker 3: are the leading provider of public safety emergency communications networks NYPD,

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Speaker 3: DNY Chicago and the like. There are about thirteen thousand

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Speaker 3: of these emergency or enterprise mission critical.

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Speaker 1: Networks around the world.

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Speaker 3: As that footprint ALEX expands, that's a good thing because

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Speaker 3: what we do then is we monetize different levels of

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Speaker 3: services on those networks, and we have device refresh.

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Speaker 1: You call them walkie talkies, We call them radios.

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Speaker 2: But the talk sound cooler by the way.

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Speaker 1: They do well, people get it? Do they go radio?

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Speaker 1: I don't understand. Well, didne Loaderolla invent the walkie talkie?

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Speaker 3: Indeed actually it was originally called the handy talkie? But yes,

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Speaker 3: but when now we call them radios?

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Speaker 1: But irrespective today fair enough they.

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Speaker 3: Last about eight years plus or minus, so we do

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Speaker 3: device refresh.

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Speaker 1: We now have LT.

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Speaker 3: Four G five G dual banded on these LMR walkie talkies,

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Speaker 3: so we have broad a reach software over their reprogramming.

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Speaker 3: Margins are up, cash flows up, total backlog. We anticipate

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Speaker 3: being up and look at the end of the day

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Speaker 3: we broke up Motorola. We are about safety and security.

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Speaker 3: Those needs are as high as ever and our end

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Speaker 3: user markets are vibrant.

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Speaker 1: So it's good.

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Speaker 2: Okay, it's a pitch, good pitch. Where does M and

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Speaker 2: A play in that? Are we looking at tuck in deals?

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Speaker 2: Are you going to have some transformative stuff to really

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Speaker 2: build up some of those.

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Speaker 3: I think it's played historically in both We've done about

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Speaker 3: forty deals in the last decade, two of them of

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Speaker 3: a billion dollars or more a little bit more consequential.

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Speaker 3: The rest I guess you would characterize as tuckins. We

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Speaker 3: sit now with a market cap of eighty billion, We're

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Speaker 3: generating two point three billion in operating cash flow. We've

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Speaker 3: got the best net debt to ebit US, so we

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Speaker 3: have dripowder. We don't have any short term financing. So

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Speaker 3: I think M and A does play a key role

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Speaker 3: going forward. I think it will likely be Tuckins. It

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Speaker 3: could be something more material, depends on what opportunities come

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Speaker 3: forward and at what price, and whether there's an actual

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Speaker 3: deal or not.

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Speaker 1: But I do view M and A as important going forward.

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Speaker 4: And you've done pretty well with that over your tenure, CEO.

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Speaker 4: I think fifteen hundred percent shareholder returns nothing to sneeze.

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Speaker 1: At since one one of eleven exactly.

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Speaker 4: So what what is next for Motorola Solutions? As I

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Speaker 4: think about your business, I have to think about AI

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Speaker 4: as well. Obviously it's almost synonymous now with cloud.

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Speaker 1: How do you put AI to work at Motorola Solution.

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Speaker 1: We're doing it now.

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Speaker 3: We've got ninety percent of our video edge devices cameras

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Speaker 3: that are powered by AI. We do video security and

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Speaker 3: access control. We have a big business of one software

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Speaker 3: nine one one command center. There's about six thousand of

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Speaker 3: those around the country. In sixty percent of the cases

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Speaker 3: they have our software. We use AI for perimeter detection,

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Speaker 3: anomaly detection, license plate recognition. If you reduce a nine

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Speaker 3: to one one call by sixty seconds, you save ten

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Speaker 3: thousand lives. We're using AI right now in nine one

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Speaker 3: one called translation, one one called transcription, and something we

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Speaker 3: call call assist where AI populates.

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Speaker 1: The dispatcher's screen.

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Speaker 3: Dispatcher can then mobilize the first responder police officer quicker,

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Speaker 3: so we'll be on the scene even faster.

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Speaker 1: And we're just beginning to use it internally.

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Speaker 3: Around a copilot for engineering and software development, documentation, sales

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Speaker 3: and services. So I think we've been prudent and measured

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Speaker 3: a little conservative in the deployment of AI. But we

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Speaker 3: have a great story of anything I, and we need

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Speaker 3: to tell it better.

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Speaker 4: But I think you've been doing a pretty good job

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Speaker 4: telling him. I'm I'm looking at the screen here at

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Speaker 4: the comp chart on the Bloomberg, and you've tripled the

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Speaker 4: performance of the s and p throughout your tenure.

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Speaker 1: So your communications are.

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Speaker 2: Spot on, but you used to come back more often.

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Speaker 4: What do you make though of the potential tariffs coming

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Speaker 4: in the next Trump administration? Is that going to be

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Speaker 4: a difficult thing for Motorala solutions?

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Speaker 1: I don't think. And here's why.

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Speaker 3: So Trump implemented tariffs on China starting in his first administration.

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Speaker 3: What did Biden do? He continued them? So I know

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Speaker 3: the administration has talked about widespread tariffs. I see Howard

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Speaker 3: Lutnik just got the Commerce secretary.

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Speaker 1: By the way, I like Howard.

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Speaker 3: I think he's a smart guy. He's created a lot

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Speaker 3: of value at Canner Fitzgerald. I think he will be

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Speaker 3: progressive and aggressive, So we'll see. I think the administration

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Speaker 3: has talked about tariffs in terms of full and fair trade.

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Speaker 1: Free trade, but fair trade.

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Speaker 3: Maybe tariffs are used for reciprocal fairness.

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Speaker 1: I'm good with that if they're deployed. So the other

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Speaker 1: problem if you're a US.

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Speaker 3: Company, maybe if tariffs are heavy, what about your input costs?

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Speaker 3: And can you pass them on with pricing. We have

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Speaker 3: gotten out of China effectively. We sued Chinese two Chinese companies.

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Speaker 3: We're the only American company to do that. Huawei initially

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Speaker 3: we settled. We're in our seventh year of litigation with

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Speaker 3: Hyterra that stole trade secrets, source code, patent infringement, and

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Speaker 3: therefore we've re architected supply chain.

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Speaker 1: We've done more dual sourcing.

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Speaker 3: So, irrespective of what the tariff landscape is, I believe

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Speaker 3: MSI can navigate it. But I think the administration coming

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Speaker 3: in has a lot of creative, disruptive and aggressive thoughts

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Speaker 3: and we'll see how it plays out.

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Speaker 1: Flip it.

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Speaker 2: Does a Trump administration mean more business and more end

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Speaker 2: user demand for you?

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Speaker 3: I think the Trump administration is favorable in that he's

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Speaker 3: been very strident and supportive of police. He believes big

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Speaker 3: city crime ought to be reduced. He believes we should

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Speaker 3: secure the border and build the wall. The wall's not

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Speaker 3: just physical, it's digital, it's more border control agents.

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Speaker 1: That's favorable.

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Speaker 3: We've got predictability in the corporate tax rate. Maybe we

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Speaker 3: get codification and certainty in the R and D tax rate.

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Speaker 3: And I believe the M and A environment and a

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Speaker 3: Trump administration should be more favorable than the current administration.

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Speaker 1: So I think there's a lot to.

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Speaker 3: Like about this administration through the lens of running a

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Speaker 3: US multinational.

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Speaker 1: Greg. Great to have you here in the studio. Thanks

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Speaker 1: for having me. Next time you come by join me at.

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Speaker 2: Nine am early or that's early, come at three.

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Speaker 4: Greg Brown is the CEO and chairman of Motorola Solutions