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Motorola Solutions Increases Sales but Misses Revenue Estimate

By Seth Jayson - Updated Apr 10, 2017 at 1:44PM

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Just the facts, Fool.

Motorola Solutions (NYSE: MSI) reported earnings on April 24. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended March 30 (Q1), Motorola Solutions missed estimates on revenues and met expectations on earnings per share.

Compared to the prior-year quarter, revenue grew slightly. Non-GAAP earnings per share grew. GAAP earnings per share expanded significantly.

Gross margins contracted, operating margins contracted, net margins grew.

Revenue details
Motorola Solutions recorded revenue of $1.97 billion. The 16 analysts polled by S&P Capital IQ expected sales of $2.05 billion on the same basis. GAAP reported sales were the same as the prior-year quarter's.

Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.

EPS details
EPS came in at $0.66. The 19 earnings estimates compiled by S&P Capital IQ predicted $0.67 per share. Non-GAAP EPS of $0.66 for Q1 were 12% higher than the prior-year quarter's $0.59 per share. (The prior-year quarter included -$0.01 per share in earnings from discontinued operations.) GAAP EPS of $0.68 for Q1 were 39% higher than the prior-year quarter's $0.49 per share. (The prior-year quarter included -$0.01 per share in earnings from discontinued operations.)

Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.

Margin details
For the quarter, gross margin was 48.4%, 130 basis points worse than the prior-year quarter. Operating margin was 10.9%, 140 basis points worse than the prior-year quarter. Net margin was 9.7%, 170 basis points better than the prior-year quarter. (Margins calculated in GAAP terms.)

Looking ahead
Next quarter's average estimate for revenue is $2.25 billion. On the bottom line, the average EPS estimate is $0.86.

Next year's average estimate for revenue is $9.16 billion. The average EPS estimate is $3.71.

Investor sentiment
The stock has a three-star rating (out of five) at Motley Fool CAPS, with 1,947 members out of 2,381 rating the stock outperform, and 434 members rating it underperform. Among 426 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 353 give Motorola Solutions a green thumbs-up, and 73 give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Motorola Solutions is outperform, with an average price target of $58.07.

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Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor of Motley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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Motorola Solutions, Inc. Stock Quote
Motorola Solutions, Inc.
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