Motorola Solutions (MSI) Q2 2026 earnings summary

Executive summary

• Achieved record Q2 2026 sales of $3.1 billion, up 13% year-over-year, with double-digit growth in both Products and Systems Integration (+15%) and Software and Services (+10%).

• GAAP EPS was $3.33 (up 10% year-over-year); non-GAAP EPS was $4.41 (up 24%), including a $0.25/share IEEPA refund benefit.

• Operating cash flow reached $469 million, up $197 million year-over-year, and backlog hit a record $15.6 billion, up 11%.

• Announced definitive agreement to acquire D-Fend Solutions for $1.5 billion, expanding counter-drone capabilities.

• Full-year guidance for both sales and EPS was raised, reflecting strong Q2 performance and robust demand.

Financial highlights

• Q2 2026 revenue grew 13% year-over-year to $3.1B, exceeding guidance, with $243 million from acquisitions and $35 million FX tailwind.

• GAAP operating earnings were $809 million (25.8% of sales), up 17% year-over-year; non-GAAP operating earnings exceeded $1 billion, up 26%.

• Non-GAAP operating margin improved by 330 basis points to 32.9%; GAAP gross margin rose to 53.6% from 51.1%.

• Free cash flow was $414 million, up $190 million year-over-year; share repurchases totaled $326 million, dividends $201 million, and CapEx $55 million in Q2.

• Net earnings attributable to shareholders were $557 million, up from $513 million year-over-year.

Outlook and guidance

• Q3 2026 sales growth expected at ~8%, with non-GAAP EPS between $4.39 and $4.44.

• Full-year 2026 revenue guidance raised to ~$12.975 billion (from $12.8B), and non-GAAP EPS to $17.62–$17.72 (from $16.87–$16.99).

• Double-digit growth expected for both segments and all three technologies for the full year.

• Operating margin expansion now expected at 170 basis points for the year.

• Effective tax rate for the year projected between 22% and 22.5%.