According to the latest stats published by Motorola Solutions, Inc., the company registered stronger than expected second quarter profits on the back of continual demand for its land mobile radio products and inorganic growth through acquisitions in Americas, Europe, Middle East, and Africa. In July 2017, Motorola Solutions, Inc. along with four other manufacturers including Harris Corporation, EF Johnson, Relm Communications, and Icom America received a US$ 495 Mn contract to provide the U.S. army with Land Mobile Radio P25 subscriber unit radios, accessories, and ancillary services.

The revenue contribution from the company’s ‘Products & System Integration’ division registered an increase of 14% or US$ 142 Mn, majority of which came from new acquisitions (Airbus DS Communications) made by the company. Motorola’s ecosystem lock-in as well as mission critical characteristic of their product applications make it unlikely that its existing customers will switch to other competitors. The company claims to have around 13,000 land mobile radio systems installed worldwide and with strong second quarter results, the company has revised its forecasted annual revenue growth from 14% to ~15% over the last financial year.

Analyst view:

With Motorola Solutions, Inc. continuing to pave the way for efficient interoperable mission-critical communications across broadband and land mobile radio networks, it will be surprising if the company fails to achieve its forecasted profit margins by the end of fiscal year. Motorola’s plans to build the one of its kind end-to-end public safety command center platform and partnerships with operators (ex – AT&T) to offer first responders with the next generation software capabilities across secure networks bodes well for its business growth. In addition, the expected five year deal extending the use of Airwave TETRA system by first responders in the U.K. will aid company in achieving the desired profit margins for fiscal year 2018 – 2019.