From Flip Phones to Public-Safety Tech

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00:00I always felt I joined Motorola in 03 and even before I became CEO I always felt the jewel of

00:06the franchise was public safety mission critical communications. So when I got the baton to run

00:13the corporation we split the assets, we doubled down on all things mission critical communications

00:19for public safety, strong revenue growth, predictability of earnings, durable and enduring

00:27cash flow. And then we built everything, Matt, around public safety into emergency workflow.

00:33So now we do everything from initial 911 call handling to the tough stuff and CAD center,

00:40nerve center dispatch to evidentiary management. And we built the largest portfolio for public

00:46safety and with Silvis now around national security. And that's what we've done. By the way,

00:52it's been organic investment and inorganic along the way, still doing double digit dividend increases

01:01every year. This will be our third year where we anticipate double digit operating cash flow growth.

01:07We bought back about 16 and a half billion dollars of stock at an aggregate price of 73 and change.

01:15So at the end of the day, my job building this company is people and capital allocation,

01:20whether it's organic or inorganic. And Matt pointed out just the incredible run that shares

01:24have been on from it. Recently, though, year to date, you are lower by some 17 and a half percent.

01:31I wonder how much of this is still this concern about supply chains, because I know there was issues

01:34during COVID and then you add tariffs to it. How much of that is still a headache for you and how

01:40much of it has been cleared up? I think it's cleared up. I think the deterioration of the stock

01:45to date is more about all things in the gold rush around A.I. We're not sexy or flashy, but, you know,

01:53double digit order growth, Q2, Q3. We anticipate that for Q4. We see a path to 15 billion of backlog,

02:00which is our largest. Danny, I think it is investor money going to not just the mag seven,

02:07but all things around A.I., data, compute, power generation. And while we're not as sexy,

02:15by the way, the fundamentals of the business are really strong. I feel better going into 26 than I

02:21did a year ago. So when I look at funding and backlog and product refresh, double digit orders

02:27growth for multiple quarters, video and command center that you referenced. And now with the addition

02:34of Silvis, I think this setup is quite good. I think this is a temporary dislocation. By the way,

02:40in the meantime, we bought back over 400 million of shares quarter to date over a billion year to date

02:47because the market will dictate our capital allocation. And we've been good opportunistically.

02:52And now's, I think, a good time. One of the things that is sexy is sort of the A.I. kind of software

02:59shift that you've made because of those margins, right? And I wonder when we're going to see that

03:06start coming through in the earnings, higher margins, when we're going to start to see that

03:11come through in the multiples. Is the stock market going to reward you for that?

03:14I think you already are, because in addition to the revenue growth and the cash flow growth,

03:21we've had consistent operating margin expansion. A.I. is a beautiful thing. Maybe we don't tout it

03:28enough, but we have the most comprehensive use of A.I. into public safety. We have our latest product,

03:35which takes a body camera and a remote speaker mic for a radio, combines it into one. And it's a

03:42multi-source A.I. assistant. It ingests mobile video. It ingests fixed video. It ingests real-time

03:51cat information with a 9-1-1 dispatcher and it ingests real-time emergency call logs for the radio.

03:59So it's ingesting all this information, making the dispatcher more productive, giving the first

04:05responder tools that he or she needs. And for every 60 seconds of 9-1-1 response to a call, it saves 10,000

04:14lives. So stay tuned on that front. You'll see us introduce some more things in January we're

04:20pretty excited about.

04:21Well, I know you had also talked about one of the lifts to your business had been increased funding

04:26by the federal government for things like border patrolling and the different immigration things

04:32we have going on. There is, though, a real public backlash in some areas to that protests in L.A. this

04:38year, concerns in New York. When you do have a border police wearing the thing that says Motorola on it,

04:45how do you ensure that you as a company don't also get caught up in some of the political backlash that

04:49we've seen? Well, I trust our customers. And ICE is a part of the Department of Homeland Security.

04:56Danny, we virtually sell to all of the agencies in Homeland Security. They're a key customer. So we're

05:04comfortable that they're using it for the provisioning of public safety, the protection of

05:08communities. And they're using the equipment to make them more productive and make our communities

05:12more safe with their discretion. You have a very serious first world problem in that you've gotten

05:19investors used to double the gains that they'll get on the S&P, right, over the last 10 and a half

05:24years. Can you continue on that kind of trajectory for the next 10 and a half years? Well, here's my

05:31here's what I would say. We have to be outperforming the market. So it's nice that the stock goes from A to B.

05:38But that's irrelevant to me and the management team. Are you outperforming your peer group?

05:43Are you outperforming the market? Because people are mobile and capital is mobile. People don't have

05:49to invest in Motorola solutions. We want to make it, we want to continue to make it a destination

05:54investment. Our track record around capital allocation, and as you pointed out, over a thousand

05:59percent total shareholder return since the creation of MSI would warrant a good record. We also know,

06:06and I know we're only as good as our latest quarter and are only as good as our latest year.

06:12I feel pretty comfortable on what we could continue to go and do in 26 and beyond.

06:17Greg, I mean, you have some really fascinating and impressive technology. I mean, what you were

06:22describing with first responders is incredible. The use of different technology put together,

06:27but also things like facial recognition, using different car surveillance techniques. Some of it,

06:33though, kind of borders on a little bit dystopian. If I'm being honest, this idea that like maybe we lose

06:37privacy as technology gets better. Public surveillance. What is your view on just like

06:42the logical end of this? Where we actually go and how you kind of find that line of aiding this

06:47incredible public service you're doing without sort of taking away privacy from people? So we have

06:52something internally called MTAC, Motorola Technical Advisory Council. Everything we do,

06:57every product we introduce. I'll give you an example. A lot of our products have AI. You talked about

07:02it. We're the only vendor to date to produce AI labels. So on our product, you know what AI model

07:10is being used, how it's being used, what it's being used for. We led the industry in that introduction.

07:17We have a cross-functional team that's very astute around not being big brother, not violating privacy,

07:25trusting our customers. The other thing you've referenced license plate recognition.

07:29We're one of the leaders in that. Well, it's a very important difference between what you mentioned

07:34and how we use it. We use license plate recognition in public safety for our customers. The data is

07:42owned by the customer. The access to it is owned by the customer. The redaction and the evidentiary

07:49duration is determined by the customer. There are other providers where they own the license plate

07:54recognition data. They control it. They can monetize it and sell use to it to other people. In public safety,

08:01we don't do it. We take it very seriously and we're proud of our record.

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