Motorola Solutions Lifts 2026 Outlook After Record Backlog

The Tip Desk · November 4, 2026 · 3 min read

Third-quarter sales were $3.38 billion and the company now expects about $13.05 billion of full-year revenue.

Motorola Solutions (MSI) raised its full-year 2026 revenue and earnings outlook for a third consecutive quarter after a record ending backlog and double-digit growth in both reportable segments.

The safety-and-security technology company now expects full-year revenue of approximately $13.050 billion, up from prior guidance of $12.975 billion, and non-GAAP earnings of $17.94 to $17.99 a share, up from $17.62 to $17.72. It also increased full-year operating cash flow expectations to $3.050 billion.

Third-quarter sales were $3.38 billion, up 12% from a year earlier. Products and Systems Integration sales were $2.12 billion, up 12%, after 15% growth in the second quarter and 1% in the first. Software and Services sales were $1.26 billion, up 13%. The company said Products and Systems Integration growth was driven by Mission Critical Networks and Video Security and Access Control, and Software and Services growth by Mission Critical Networks, Command Center and Video. Revenue related to acquisitions was $211 million and foreign-currency tailwinds were $11 million.

GAAP operating earnings were $777 million, or 23.0% of sales, versus 25.6% a year earlier. The company said the GAAP margin decline was driven primarily by an increase to the contingent Silvus earnout. Non-GAAP operating earnings were $1.10 billion, or 32.5% of sales, up 200 basis points from 30.5% a year earlier, which the company attributed to higher sales and improved operating leverage, partially offset by higher supply-chain costs.

GAAP diluted earnings were $3.06 a share, down 8% from $3.33 a year earlier. Non-GAAP earnings were $4.69 a share, up 16% from $4.06. The GAAP effective tax rate was 24.2%, versus 22.2% a year earlier; the non-GAAP rate was 21.8%, versus 20.7%. The company said the tax-rate increases were driven primarily by lower benefits from share-based compensation.

Ending backlog reached a record $16.6 billion, up 14% or $2.1 billion from the year-ago quarter, after $15.6 billion at the end of the second quarter. The company said the increase was driven by record third-quarter orders in all three technologies. Products and Systems Integration backlog was up $635 million, or 18%, and Software and Services backlog was up $1.4 billion, or 13%.

Operating cash flow was $662 million and free cash flow was $589 million, versus $799 million and $733 million a year earlier. The company said both declined due to higher tax and interest payments, primarily offset by higher earnings net of non-cash charges.

The company closed the D-Fend Solutions counter-drone acquisition for $1.3 billion, net of cash acquired, funded primarily with $950 million of new long-term senior notes, and acquired DeepNeuronic for $29 million, net of cash acquired. It also announced a $2 billion increase to the share-repurchase authorization and repurchased $94 million of common stock at an average price of $457.07.

The company said it is experiencing higher memory costs from AI-driven demand and expects inventory levels to remain elevated as it manages supply-chain volatility. For the fourth quarter of 2026, it expects revenue growth of approximately 13% versus the fourth quarter of 2025 and non-GAAP earnings of $5.47 to $5.52 a share, assuming about 168 million fully diluted shares and a non-GAAP tax rate of about 22.5%.