Cover Page
Cover Page - shares | 6 Months Ended | |
Jul. 03, 2021 | Jul. 15, 2021 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Jul. 3, 2021 | |
Document Transition Report | false | |
Entity File Number | 1-7221 | |
Entity Registrant Name | MOTOROLA SOLUTIONS, INC. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 36-1115800 | |
Entity Address, Address Line One | 500 W. Monroe Street | |
Entity Address, City or Town | Chicago | |
Entity Address, State or Province | IL | |
Entity Address, Postal Zip Code | 60661 | |
City Area Code | 847 | |
Local Phone Number | 576-5000 | |
Title of 12(b) Security | Common Stock | |
Trading Symbol | MSI | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 169,324,600 | |
Entity Central Index Key | 0000068505 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2021 | |
Document Fiscal Period Focus | Q2 | |
Amendment Flag | false |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations (Unaudited) - USD ($) shares in Millions, $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jul. 03, 2021 | Jun. 27, 2020 | Jul. 03, 2021 | Jun. 27, 2020 | |
Net sales | $ 1,971 | $ 1,618 | $ 3,744 | $ 3,273 |
Costs of sales | 1,019 | 852 | 1,932 | 1,720 |
Gross margin | 952 | 766 | 1,812 | 1,553 |
Selling, general and administrative expenses | 331 | 297 | 633 | 638 |
Research and development expenditures | 181 | 161 | 361 | 330 |
Other charges | 70 | 90 | 150 | 109 |
Operating earnings | 370 | 218 | 668 | 476 |
Other income (expense): | ||||
Interest expense, net | (44) | (58) | (98) | (109) |
Other, net | 14 | 16 | 60 | 34 |
Total other expense | (30) | (42) | (38) | (75) |
Net earnings before income taxes | 340 | 176 | 630 | 401 |
Income tax expense | 46 | 40 | 90 | 67 |
Net earnings | 294 | 136 | 540 | 334 |
Less: Earnings attributable to non-controlling interests | 1 | 1 | 3 | 2 |
Net earnings attributable to Motorola Solutions, Inc. | $ 293 | $ 135 | $ 537 | $ 332 |
Earnings per common share: | ||||
Basic (in USD per share) | $ 1.73 | $ 0.79 | $ 3.17 | $ 1.95 |
Diluted (in USD per share) | $ 1.69 | $ 0.78 | $ 3.10 | $ 1.90 |
Weighted average common shares outstanding: | ||||
Basic (in shares) | 169.6 | 170 | 169.4 | 170.3 |
Diluted (in shares) | 173.1 | 173.6 | 173.1 | 174.8 |
Products | ||||
Net sales | $ 1,094 | $ 877 | $ 2,027 | $ 1,764 |
Costs of sales | 511 | 413 | 952 | 812 |
Services | ||||
Net sales | 877 | 741 | 1,717 | 1,509 |
Costs of sales | $ 508 | $ 439 | $ 980 | $ 908 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Comprehensive Income (Unaudited) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jul. 03, 2021 | Jun. 27, 2020 | Jul. 03, 2021 | Jun. 27, 2020 | |
Statement of Comprehensive Income [Abstract] | ||||
Net earnings | $ 294 | $ 136 | $ 540 | $ 334 |
Other comprehensive income (loss), net of tax (Note 4): | ||||
Foreign currency translation adjustments | 6 | 78 | 25 | (60) |
Defined benefit plans | 16 | 13 | 33 | 25 |
Total other comprehensive income (loss), net of tax | 22 | 91 | 58 | (35) |
Comprehensive income | 316 | 227 | 598 | 299 |
Less: Earnings attributable to non-controlling interests | 1 | 1 | 3 | 2 |
Comprehensive income attributable to Motorola Solutions, Inc. common shareholders | $ 315 | $ 226 | $ 595 | $ 297 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (Unaudited) - USD ($) $ in Millions | Jul. 03, 2021 | Dec. 31, 2020 |
ASSETS | ||
Cash and cash equivalents | $ 1,921 | $ 1,254 |
Accounts receivable, net | 1,169 | 1,390 |
Contract assets | 757 | 933 |
Inventories, net | 559 | 508 |
Other current assets | 254 | 242 |
Total current assets | 4,660 | 4,327 |
Property, plant and equipment, net | 1,028 | 1,022 |
Operating lease assets | 430 | 468 |
Investments | 181 | 158 |
Deferred income taxes | 981 | 966 |
Goodwill | 2,219 | 2,219 |
Intangible assets, net | 1,123 | 1,234 |
Other assets | 509 | 482 |
Total assets | 11,131 | 10,876 |
LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT) | ||
Current portion of long-term debt | 9 | 12 |
Accounts payable | 547 | 612 |
Contract liabilities | 1,416 | 1,554 |
Accrued liabilities | 1,212 | 1,311 |
Total current liabilities | 3,184 | 3,489 |
Long-term debt | 5,686 | 5,163 |
Operating lease liabilities | 340 | 402 |
Other liabilities | 2,265 | 2,363 |
Stockholders’ Equity | ||
Preferred stock, $100 par value: 0.5 shares authorized; none issued and outstanding | 0 | 0 |
Common stock, $0.01 par value. Authorized shares: 600.0, Issued shares: 7/3/21—170.3; 12/31/20—170.2, Outstanding shares: 7/3/21—169.3; 12/31/20—169.4 | 2 | 2 |
Additional paid-in capital | 877 | 759 |
Retained earnings | 1,151 | 1,127 |
Accumulated other comprehensive loss | (2,388) | (2,446) |
Total Motorola Solutions, Inc. stockholders’ equity (deficit) | (358) | (558) |
Non-controlling interests | 14 | 17 |
Total stockholders’ equity (deficit) | (344) | (541) |
Total liabilities and stockholders’ equity (deficit) | $ 11,131 | $ 10,876 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) - $ / shares | Jul. 03, 2021 | Dec. 31, 2020 |
Stockholders’ Equity | ||
Preferred stock par value (in USD per share) | $ 100 | $ 100 |
Preferred stock authorized (in shares) | 500,000 | 500,000 |
Preferred stock issued (in shares) | 0 | 0 |
Preferred stock outstanding (in shares) | 0 | 0 |
Common stock par value (in USD per share) | $ 0.01 | $ 0.01 |
Common stock authorized (in shares) | 600,000,000 | 600,000,000 |
Common stock issued (in shares) | 170,300,000 | 170,200,000 |
Common stock outstanding (in shares) | 169,300,000 | 169,400,000 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Stockholders' Equity (Deficit) (Unaudited) - USD ($) shares in Millions, $ in Millions | Total | Common Stock and Additional Paid-in Capital | Accumulated Other Comprehensive Income (Loss) | Retained Earnings | Noncontrolling Interests |
Balance at beginning of period (in shares) at Dec. 31, 2019 | 171 | ||||
Balance at beginning of period at Dec. 31, 2019 | $ 501 | $ (2,440) | $ 1,239 | $ 17 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net earnings | 197 | 1 | |||
Other comprehensive income (loss) | (126) | ||||
Issuance of common stock and stock options exercised (in shares) | 1.3 | ||||
Issuance of common stock and stock options exercised | $ 5 | ||||
Share repurchase program (in shares) | (1.6) | ||||
Share repurchase program | (253) | ||||
Share-based compensation expenses | $ 38 | ||||
Dividends declared | (109) | ||||
Balance at ending of period (in shares) at Mar. 28, 2020 | 170.7 | ||||
Balance at end of period at Mar. 28, 2020 | $ 544 | (2,566) | 1,074 | 18 | |
Balance at beginning of period (in shares) at Dec. 31, 2019 | 171 | ||||
Balance at beginning of period at Dec. 31, 2019 | $ 501 | (2,440) | 1,239 | 17 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net earnings | $ 334 | ||||
Other comprehensive income (loss) | (35) | ||||
Balance at ending of period (in shares) at Jun. 27, 2020 | 170.7 | ||||
Balance at end of period at Jun. 27, 2020 | $ 628 | (2,475) | 1,017 | 15 | |
Balance at beginning of period (in shares) at Mar. 28, 2020 | 170.7 | ||||
Balance at beginning of period at Mar. 28, 2020 | $ 544 | (2,566) | 1,074 | 18 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net earnings | 136 | 135 | 1 | ||
Other comprehensive income (loss) | 91 | 91 | |||
Issuance of common stock and stock options exercised (in shares) | 0.6 | ||||
Issuance of common stock and stock options exercised | $ 53 | ||||
Share repurchase program (in shares) | (0.6) | ||||
Share repurchase program | (83) | ||||
Share-based compensation expenses | $ 31 | ||||
Dividends declared | (109) | ||||
Dividends paid to non-controlling interest on subsidiary common stock | (4) | ||||
Balance at ending of period (in shares) at Jun. 27, 2020 | 170.7 | ||||
Balance at end of period at Jun. 27, 2020 | $ 628 | (2,475) | 1,017 | 15 | |
Balance at beginning of period (in shares) at Dec. 31, 2020 | 170.2 | ||||
Balance at beginning of period at Dec. 31, 2020 | (541) | $ 761 | (2,446) | 1,127 | 17 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net earnings | 244 | 1 | |||
Other comprehensive income (loss) | 36 | ||||
Issuance of common stock and stock options exercised (in shares) | 1.4 | ||||
Issuance of common stock and stock options exercised | $ 44 | ||||
Share repurchase program (in shares) | (1) | ||||
Share repurchase program | (170) | ||||
Share-based compensation expenses | $ 29 | ||||
Dividends declared | (121) | ||||
Dividends paid to non-controlling interest on subsidiary common stock | (5) | ||||
Balance at ending of period (in shares) at Apr. 03, 2021 | 170.6 | ||||
Balance at end of period at Apr. 03, 2021 | $ 834 | (2,410) | 1,080 | 18 | |
Balance at beginning of period (in shares) at Dec. 31, 2020 | 170.2 | ||||
Balance at beginning of period at Dec. 31, 2020 | (541) | $ 761 | (2,446) | 1,127 | 17 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net earnings | 540 | ||||
Other comprehensive income (loss) | $ 58 | ||||
Share repurchase program (in shares) | (1.5) | ||||
Balance at ending of period (in shares) at Jul. 03, 2021 | 170.3 | ||||
Balance at end of period at Jul. 03, 2021 | $ (344) | $ 879 | (2,388) | 1,151 | 14 |
Balance at beginning of period (in shares) at Apr. 03, 2021 | 170.6 | ||||
Balance at beginning of period at Apr. 03, 2021 | $ 834 | (2,410) | 1,080 | 18 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net earnings | 294 | 293 | 1 | ||
Other comprehensive income (loss) | $ 22 | 22 | |||
Issuance of common stock and stock options exercised (in shares) | 0.2 | ||||
Issuance of common stock and stock options exercised | $ 14 | ||||
Share repurchase program (in shares) | (0.5) | (0.5) | |||
Share repurchase program | (102) | ||||
Share-based compensation expenses | $ 31 | ||||
Dividends declared | (120) | ||||
Balance at ending of period (in shares) at Jul. 03, 2021 | 170.3 | ||||
Balance at end of period at Jul. 03, 2021 | $ (344) | $ 879 | $ (2,388) | $ 1,151 | $ 14 |
Condensed Consolidated Statem_4
Condensed Consolidated Statements of Stockholders' Equity (Deficit) (Unaudited) (Parenthetical) - $ / shares | 3 Months Ended | |||
Jul. 03, 2021 | Apr. 03, 2021 | Jun. 27, 2020 | Mar. 28, 2020 | |
Statement of Stockholders' Equity [Abstract] | ||||
Dividends declared per share (in USD per share) | $ 0.71 | $ 0.71 | $ 0.64 | $ 0.64 |
Condensed Consolidated Statem_5
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Millions | 6 Months Ended | |
Jul. 03, 2021 | Jun. 27, 2020 | |
Operating | ||
Net earnings | $ 540 | $ 334 |
Adjustments to reconcile Net earnings to Net cash provided by operating activities: | ||
Depreciation and amortization | 220 | 197 |
Non-cash other income | (24) | (40) |
Share-based compensation expenses | 60 | 69 |
Loss from the extinguishment of long-term debt | 18 | 0 |
Changes in assets and liabilities, net of effects of acquisitions, dispositions, and foreign currency translation adjustments: | ||
Accounts receivable | 221 | 286 |
Inventories | (53) | 3 |
Other current assets and contract assets | 134 | 136 |
Accounts payable, accrued liabilities, and contract liabilities | (298) | (454) |
Other assets and liabilities | (37) | (15) |
Deferred income taxes | (23) | 1 |
Net cash provided by operating activities | 758 | 517 |
Investing | ||
Acquisitions and investments, net | (9) | (102) |
Proceeds from sales of investments and businesses, net | 3 | 7 |
Capital expenditures | (114) | (102) |
Proceeds from sales of property, plant and equipment | 6 | 56 |
Net cash used for investing activities | (114) | (141) |
Financing | ||
Net proceeds from issuance of debt | 844 | 0 |
Proceeds from revolving credit facility draw | 0 | 800 |
Repayments of debt | (348) | (8) |
Repayment of revolving credit facility draw | 0 | (300) |
Revolving credit facility renewal fees | (7) | 0 |
Issuances of common stock | 60 | 49 |
Purchases of common stock | (272) | (336) |
Payments of dividends | (242) | (218) |
Payments of dividends to non-controlling interests | (5) | (4) |
Net cash provided by (used for) financing activities | 30 | (17) |
Effect of exchange rate changes on total cash and cash equivalents | (7) | (19) |
Net increase in total cash and cash equivalents | 667 | 340 |
Cash and cash equivalents, beginning of period | 1,254 | 1,001 |
Cash and cash equivalents, end of period | 1,921 | 1,341 |
Cash paid during the period for: | ||
Interest paid | 102 | 109 |
Income and withholding taxes, net of refunds | 179 | 50 |
Long-term Debt, Excluding Convertible Debt | ||
Adjustments to reconcile Net earnings to Net cash provided by operating activities: | ||
Loss from the extinguishment of long-term debt | $ 18 | $ 0 |
Basis of Presentation
Basis of Presentation | 6 Months Ended |
Jul. 03, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation The condensed consolidated financial statements as of July 3, 2021 and for the three and six months ended July 3, 2021 and June 27, 2020 include, in the opinion of management, all adjustments (consisting of normal recurring adjustments and reclassifications) necessary to state fairly the Condensed Consolidated Balance Sheets, Statements of Operations, Statements of Comprehensive Income, Statements of Stockholders' Equity (Deficit), and Statements of Cash Flows of Motorola Solutions, Inc. (“Motorola Solutions” or the “Company”) for all periods presented. The Company operates on a 52-week fiscal year, with each fiscal year ending on December 31. With respect to each fiscal quarter, the Company operates on a 13-week fiscal quarter, with all fiscal quarters ending on a Saturday. Certain information and footnote disclosures normally included in financial statements prepared in accordance with United States generally accepted accounting principles (“U.S. GAAP”) have been condensed or omitted. These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s Form 10-K for the year ended December 31, 2020 (the "Form 10-K"). The results of operations for the three and six months ended July 3, 2021 are not necessarily indicative of the operating results to be expected for the full year. The preparation of financial statements in conformity with U.S. GAAP requires management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimates. Change in Presentation As further described in the Form 10-K, during the fourth quarter of 2020, the Company updated its revenue disaggregation presentation of major products and services to provide a more comprehensive view of technologies within the Company's reporting segments. Accordingly, the Company now reports net sales in the following three major products and services (which the Company refers to as “technologies” in this Quarterly Report on Form 10-Q (this “Form 10-Q”)): Land Mobile Radio Mission Critical Communications (“LMR” or “LMR Mission Critical Communications”), Video Security and Access Control, and Command Center Software. With the Company's acquisition of Openpath Security Inc. (“Openpath”) subsequent to quarter end on July 15, 2021, the Company renamed one of its three major products and services technologies from Video Security and Analytics to Video Security and Access Control to better align with its strategic growth initiatives. The change is to the name of the technology only and no financial information has been reclassified from previous periods presented or for the quarter ended July 3, 2021. • LMR Mission Critical Communications: Infrastructure, devices (two-way radio and broadband, including both for public safety and Professional Commercial Radio ("PCR")) and software that enable communications, inclusive of installation and integration, backed by services, to assure availability, security and resiliency. • Video Security and Access Control: Cameras (fixed, body-worn, in-vehicle), access control, infrastructure, video management, software and artificial intelligence-enabled analytics that enable visibility “on scene” and bring attention to what’s important. • Command Center Software: Software suite that enables collaboration and seamless information sharing through the public safety workflow from 911 call to case closure. Recent Acquisitions Subsequent to quarter end, on July 15, 2021, the Company acquired Openpath, a cloud-based mobile access control provider for $297 million, net of cash acquired. In addition, the Company issued restricted stock at a fair value of $29 million to certain key employees that will be expensed over an average service period of three years. The transaction also includes the potential for the Company to make earn-out payments based on Openpath's achievement of certain financial targets from January 1, 2022 through December 31, 2022. This acquisition expands the Company's ability to combine video security and access control solutions within Video Security and Access Control to help support enterprise customers. Due to the timing of the acquisition, the initial accounting for the acquisition is incomplete. On August 28, 2020, the Company acquired the Callyo business ("Callyo"), a cloud-based mobile applications provider for law enforcement in North America for $63 million, inclusive of share-based compensation withheld at a fair value of $3 million that will be expensed over an average service period of two years. The acquisition was settled with $61 million in cash, net of cash acquired. This acquisition adds to the Company's existing Command Center Software suite critical mobile technological capabilities that enable information to flow seamlessly from the field to the command center. The business is a part of the Software and Services segment. On July 31, 2020, the Company acquired Pelco, Inc. ("Pelco"), a global provider of video security solutions for a purchase price of $110 million. The acquisition was settled with $107 million of cash, net of cash acquired. The acquisition demonstrates the Company's continued investment in Video Security and Access Control, adding a broad range of products that can be used in a variety of commercial and industrial environments and use cases. The business is a part of both the Products and Systems Integration segment and the Software and Services segment. On June 16, 2020, the Company acquired IndigoVision Group plc ("IndigoVision") for a purchase price of $37 million. The acquisition was settled with $35 million of cash, net of cash acquired and debt assumed. The acquisition complements the Company's Video Security and Access Control technology, providing enhanced geographical reach across a wider customer base. The business is a part of both the Products and Systems Integration segment and the Software and Services segment. On April 30, 2020, the Company acquired a cybersecurity services business for $32 million of cash, net of cash acquired. The acquisition expands the Company's ability to assist customers with cybersecurity needs through vulnerability assessments, cybersecurity consulting, and managed services including security monitoring of network operations. The business is a part of the Software and Services segment. On March 3, 2020, the Company acquired a cybersecurity services business for $40 million, inclusive of share-based compensation withheld at a fair value of $6 million that will be expensed over a service period of two years. The acquisition was settled with $33 million of cash, net of cash acquired. The acquisition expands the Company's ability to assist customers with cybersecurity needs through vulnerability assessments, cybersecurity consulting, managed services and remediation and response capabilities. The business is a part of the Software and Services segment. Recent Accounting Pronouncements In August 2020, the FASB issued ASU No. 2020-06, "Debt - Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging-Contracts in Entity’s Own Equity (Subtopic 815-40) - Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity," which simplifies the accounting for certain financial instruments with characteristics of liabilities and equity, including convertible instruments. The new guidance removes the separation models for convertible debt with a cash conversion feature or a beneficial conversion feature. In addition, the new standard provides guidance on calculating the dilutive impact of convertible debt on earnings per share. The ASU clarifies that the average market price should be used to calculate the diluted earnings per share denominator when the exercise price or the number of shares that may be issued is variable. The ASU is effective for the Company on January 1, 2022, including interim periods, with early adoption permitted. The ASU permits the use of either a full or modified retrospective method of adoption. The Company is still evaluating the impact of the adoption of this ASU on its financial statements and disclosures. Recently Adopted Accounting Pronouncements In December 2019, the FASB issued ASU No. 2019-12, “Income Taxes (Topic 740),” which simplifies the accounting for income taxes by removing certain exceptions and streamlining other areas of accounting for income taxes. Portions of the amendment within the ASU require retrospective, modified retrospective or prospective adoption methods. The Company adopted ASU No. 2019-12 as of January 1, 2021 on a prospective basis and the adoption of this standard did not have a material impact on its financial statements and disclosures. |
Revenue from Contracts with Cus
Revenue from Contracts with Customers | 6 Months Ended |
Jul. 03, 2021 | |
Revenue from Contract with Customer [Abstract] | |
Revenue from Contracts with Customers | Revenue from Contracts with Customers Disaggregation of Revenue The following table summarizes the disaggregation of the Company's revenue by segment, region, major products and services and customer type for the three and six months ended July 3, 2021 and June 27, 2020, consistent with the information reviewed by the Company's chief operating decision maker for evaluating the financial performance of the Company's reportable segments: Three Months Ended July 3, 2021 June 27, 2020 (In millions) Products and Systems Integration Software and Services Total Products and Systems Integration Software and Services Total Regions: North America $ 869 $ 443 $ 1,312 $ 719 $ 374 $ 1,093 International 329 330 659 249 276 525 $ 1,198 $ 773 $ 1,971 $ 968 $ 650 $ 1,618 Major Products and Services: LMR $ 986 $ 545 $ 1,531 $ 836 $ 481 $ 1,317 Video Security and Access Control 212 94 306 132 52 184 Command Center Software — 134 134 — 117 117 $ 1,198 $ 773 $ 1,971 $ 968 $ 650 $ 1,618 Customer Types: Direct $ 706 $ 706 $ 1,412 $ 634 $ 611 $ 1,245 Indirect 492 67 559 334 39 373 $ 1,198 $ 773 $ 1,971 $ 968 $ 650 $ 1,618 Six Months Ended July 3, 2021 June 27, 2020 Products and Systems Integration Software and Services Total Products and Systems Integration Software and Services Total Regions: North America $ 1,611 $ 886 $ 2,497 $ 1,467 $ 742 $ 2,209 International 602 645 1,247 494 570 1,064 $ 2,213 $ 1,531 $ 3,744 $ 1,961 $ 1,312 $ 3,273 Major Products and Services: LMR $ 1,836 $ 1,095 $ 2,931 $ 1,696 $ 970 $ 2,666 Video Security and Access Control 377 182 559 265 119 384 Command Center Software — 254 254 — 223 223 $ 2,213 $ 1,531 $ 3,744 $ 1,961 $ 1,312 $ 3,273 Customer Types: Direct $ 1,310 $ 1,396 $ 2,706 $ 1,275 $ 1,232 $ 2,507 Indirect 903 135 1,038 686 80 766 $ 2,213 $ 1,531 $ 3,744 $ 1,961 $ 1,312 $ 3,273 Remaining Performance Obligations Remaining performance obligations represent the revenue that is expected to be recognized in future periods related to performance obligations that are unsatisfied, or partially unsatisfied, as of the end of a period. The transaction values associated with remaining performance obligations which were not yet satisfied as of July 3, 2021 was $7.1 billion. A total of $3.3 billion was from Products and Systems Integration performance obligations that are not yet satisfied, of which $1.7 billion is expected to be recognized in the next twelve months. The remaining amounts will generally be satisfied over time as systems are implemented. A total of $3.8 billion was from Software and Services performance obligations that were not yet satisfied as of July 3, 2021. The determination of Software and Services performance obligations that are not satisfied takes into account a contract term that may be limited by the customer’s ability to terminate for convenience. Where termination for convenience exists in the Company's service contracts, its disclosure of the remaining performance obligations that are unsatisfied assumes the contract term is limited until renewal. The Company expects to recognize $1.5 billion from unsatisfied Software and Services performance obligations over the next twelve months, with the remaining performance obligations to be recognized over time as services are performed and software is implemented. Contract Balances (In millions) July 3, 2021 December 31, 2020 Accounts receivable, net $ 1,169 $ 1,390 Contract assets 757 933 Contract liabilities 1,416 1,554 Non-current contract liabilities 296 283 Revenue recognized during the three months ended July 3, 2021 which was previously included in Contract liabilities as of April 3, 2021 was $483 million, compared to $370 million of revenue recognized during the three months ended June 27, 2020 which was previously included in Contract liabilities as of March 28, 2020. Revenue recognized during the six months ended July 3, 2021 which was previously included in Contract liabilities as of December 31, 2020 was $705 million, compared to $631 million recognized during the six months ended June 27, 2020 which was previously included in Contract liabilities as of December 31, 2019. Revenue of $10 million and $15 million was reversed during the three and six months ended July 3, 2021, respectively, related to performance obligations satisfied or partially satisfied, in previous periods, primarily driven by changes in the estimates of progress on system contracts, compared to $12 million and $34 million of reversals for the three and six months ended June 27, 2020, respectively. There were no material expected credit losses recorded on contract assets during each of the three and six months ended July 3, 2021 and June 27, 2020. Contract Cost Balances (In millions) July 3, 2021 December 31, 2020 Current contract cost assets $ 30 $ 23 Non-current contract cost assets 110 105 |
Leases
Leases | 6 Months Ended |
Jul. 03, 2021 | |
Leases [Abstract] | |
Operating Leases | Leases Components of Lease Expense Three Months Ended Six Months Ended (in millions) July 3, 2021 June 27, 2020 July 3, 2021 June 27, 2020 Lease expense: Operating lease cost $ 34 $ 33 $ 67 $ 67 Finance lease cost Amortization of right-of-use assets 3 3 6 6 Interest on lease liabilities — — — 1 Total finance lease cost 3 3 6 7 Short-term lease cost 1 1 2 1 Variable cost 9 9 18 17 Sublease income (1) (1) (2) (2) Net lease expense $ 46 $ 45 $ 91 $ 90 Lease Assets and Liabilities (in millions) Statement Line Classification July 3, 2021 December 31, 2020 Assets: Operating lease assets Operating lease assets $ 430 $ 468 Finance lease assets Property, plant, and equipment, net 24 30 $ 454 $ 498 Current liabilities: Operating lease liabilities Accrued liabilities $ 129 $ 126 Finance lease liabilities Current portion of long-term debt 8 11 $ 137 $ 137 Non-current liabilities: Operating lease liabilities Operating lease liabilities $ 340 $ 402 Finance lease liabilities Long-term debt 2 5 $ 342 $ 407 Other Information Related to Leases Six Months Ended (in millions) July 3, 2021 June 27, 2020 Supplemental cash flow information: Net cash used for operating activities related to operating leases $ 95 $ 84 Net cash used for operating activities related to finance leases — 1 Net cash used for financing activities related to finance leases 7 6 Assets obtained in exchange for lease liabilities: Operating leases $ 22 $ 24 July 3, 2021 December 31, 2020 Weighted average remaining lease terms (years): Operating leases 6 6 Finance leases 1 2 Weighted average discount rate: Operating leases 3.16 % 3.30 % Finance leases 4.14 % 4.21 % Future Lease Payments July 3, 2021 (in millions) Operating Leases Finance Leases Total Remainder of 2021 $ 50 $ 5 $ 55 2022 135 5 140 2023 79 1 80 2024 64 — 64 2025 51 — 51 Thereafter 140 — 140 Total lease payments 519 11 530 Less: interest 50 1 51 Present value of lease liabilities $ 469 $ 10 $ 479 |
Finance Leases | Leases Components of Lease Expense Three Months Ended Six Months Ended (in millions) July 3, 2021 June 27, 2020 July 3, 2021 June 27, 2020 Lease expense: Operating lease cost $ 34 $ 33 $ 67 $ 67 Finance lease cost Amortization of right-of-use assets 3 3 6 6 Interest on lease liabilities — — — 1 Total finance lease cost 3 3 6 7 Short-term lease cost 1 1 2 1 Variable cost 9 9 18 17 Sublease income (1) (1) (2) (2) Net lease expense $ 46 $ 45 $ 91 $ 90 Lease Assets and Liabilities (in millions) Statement Line Classification July 3, 2021 December 31, 2020 Assets: Operating lease assets Operating lease assets $ 430 $ 468 Finance lease assets Property, plant, and equipment, net 24 30 $ 454 $ 498 Current liabilities: Operating lease liabilities Accrued liabilities $ 129 $ 126 Finance lease liabilities Current portion of long-term debt 8 11 $ 137 $ 137 Non-current liabilities: Operating lease liabilities Operating lease liabilities $ 340 $ 402 Finance lease liabilities Long-term debt 2 5 $ 342 $ 407 Other Information Related to Leases Six Months Ended (in millions) July 3, 2021 June 27, 2020 Supplemental cash flow information: Net cash used for operating activities related to operating leases $ 95 $ 84 Net cash used for operating activities related to finance leases — 1 Net cash used for financing activities related to finance leases 7 6 Assets obtained in exchange for lease liabilities: Operating leases $ 22 $ 24 July 3, 2021 December 31, 2020 Weighted average remaining lease terms (years): Operating leases 6 6 Finance leases 1 2 Weighted average discount rate: Operating leases 3.16 % 3.30 % Finance leases 4.14 % 4.21 % Future Lease Payments July 3, 2021 (in millions) Operating Leases Finance Leases Total Remainder of 2021 $ 50 $ 5 $ 55 2022 135 5 140 2023 79 1 80 2024 64 — 64 2025 51 — 51 Thereafter 140 — 140 Total lease payments 519 11 530 Less: interest 50 1 51 Present value of lease liabilities $ 469 $ 10 $ 479 |
Other Financial Data
Other Financial Data | 6 Months Ended |
Jul. 03, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Other Financial Data | Other Financial Data Statements of Operations Information Other Charges Other charges (income) included in Operating earnings consist of the following: Three Months Ended Six Months Ended July 3, 2021 June 27, 2020 July 3, 2021 June 27, 2020 Other charges: Intangibles amortization (Note 15) $ 58 $ 51 $ 116 $ 104 Reorganization of business (Note 14) 6 26 20 38 Operating lease asset impairments — — 7 — Acquisition-related transaction fees 3 1 4 3 Losses on legal settlements 3 7 3 9 Fixed asset impairment — 5 — 5 Gain on sale of property, plant and equipment — — — (50) $ 70 $ 90 $ 150 $ 109 During the six months ended July 3, 2021, the Company recognized $7 million of operating lease asset impairments relating to the consolidation of acquired U.S. manufacturing and distribution facilities. This loss has been recognized in Other charges in the Company's Condensed Consolidated Statements of Operations. During the six months ended June 27, 2020, the Company recorded a $50 million gain on the sale of a manufacturing facility in Europe. This gain has been recognized in Other charges in the Company's Condensed Consolidated Statements of Operations. Other Income (Expense) Interest expense, net, and Other, net, both included in Other income (expense), consist of the following: Three Months Ended Six Months Ended July 3, 2021 June 27, 2020 July 3, 2021 June 27, 2020 Interest income (expense), net: Interest expense $ (46) $ (60) $ (102) $ (114) Interest income 2 2 4 5 $ (44) $ (58) $ (98) (109) Other, net: Net periodic pension and postretirement benefit (Note 8) $ 31 $ 19 $ 60 $ 39 Loss from the extinguishment of long-term debt (Note 5) (18) — (18) — Foreign currency gain (loss) (6) (21) 8 (3) Gain (loss) on derivative instruments (1) 12 (9) (4) Gains on equity method investments 2 — 3 — Fair value adjustments to equity investments 8 4 13 5 Other (2) 2 3 (3) $ 14 $ 16 $ 60 $ 34 Earnings Per Common Share The computation of basic and diluted earnings per common share is as follows: Amounts attributable to Motorola Solutions, Inc. common stockholders Three Months Ended Six Months Ended July 3, 2021 June 27, 2020 July 3, 2021 June 27, 2020 Basic earnings per common share: Earnings $ 293 $ 135 $ 537 $ 332 Weighted average common shares outstanding 169.6 170.0 169.4 170.3 Per share amount $ 1.73 $ 0.79 $ 3.17 $ 1.95 Diluted earnings per common share: Earnings $ 293 $ 135 $ 537 $ 332 Weighted average common shares outstanding 169.6 170.0 169.4 170.3 Add effect of dilutive securities: Share-based awards 3.5 3.6 3.7 4.5 1.75% senior convertible notes — — — — Diluted weighted average common shares outstanding 173.1 173.6 173.1 174.8 Per share amount $ 1.69 $ 0.78 $ 3.10 $ 1.90 In the computation of diluted earnings per common share for the three months ended July 3, 2021, the assumed exercise of 0.4 million options, including 0.2 million subject to market based contingent option agreements, were excluded because their inclusion would have been antidilutive. For the six months ended July 3, 2021, the assumed exercise of 0.4 options, including 0.1 million subject to market based contingent option agreements, were excluded because their inclusion would have been antidilutive. In the computation of diluted earnings per common share for the three months ended June 27, 2020, 0.6 million options, including 0.2 million subject to market based contingent option agreements, were excluded because their inclusion would have been antidilutive. For the six months ended June 27, 2020, the assumed exercise of 0.4 million options, including 0.1 million subject to market based contingent option agreements, were excluded because their inclusion would have been antidilutive. As of July 3, 2021, the Company had $1.0 billion of 1.75% Senior Convertible Notes outstanding which mature on September 15, 2024 ("Senior Convertible Notes"). The notes are convertible based on a conversion rate of 4.9140 per $1,000 principal amount (which is equal to an initial conversion price of $203.50 per share). In the event of conversion, the Company intends to settle the principal amount of the Senior Convertible Notes in cash. Because of the Company’s intention to settle the par value of the Senior Convertible Notes in cash, Motorola Solutions does not reflect any shares underlying the Senior Convertible Notes in its diluted weighted average shares outstanding until the average stock price per share for the period exceeds the conversion price. Only the number of shares that would be issuable (under the treasury stock method of accounting for share dilution) will be included, which is based upon the amount by which the average stock price for the period exceeds the conversion price of $203.50. The conversion price is adjusted for dividends declared through the date of settlement. For the period ended July 3, 2021, there was no dilutive effect of the Senior Convertible Notes on diluted earnings per share attributable to Motorola Solutions, Inc. as the average stock price for the period outstanding was below the conversion price. Balance Sheet Information Accounts Receivable, Net Accounts receivable, net, consists of the following: July 3, 2021 December 31, 2020 Accounts receivable $ 1,244 $ 1,465 Less allowance for credit losses (75) (75) $ 1,169 $ 1,390 Inventories, Net Inventories, net, consist of the following: July 3, 2021 December 31, 2020 Finished goods $ 261 $ 271 Work-in-process and production materials 429 360 690 631 Less inventory reserves (131) (123) $ 559 $ 508 Other Current Assets Other current assets consist of the following: July 3, 2021 December 31, 2020 Current contract cost assets (Note 2) $ 30 $ 23 Tax-related deposits 44 52 Other 180 167 $ 254 $ 242 Property, Plant and Equipment, Net Property, plant and equipment, net, consist of the following: July 3, 2021 December 31, 2020 Land $ 4 $ 6 Leasehold improvements 473 439 Machinery and equipment 2,378 2,276 2,855 2,721 Less accumulated depreciation (1,827) (1,699) $ 1,028 $ 1,022 Depreciation expense for the three months ended July 3, 2021 and June 27, 2020 was $52 million and $47 million, respectively. Depreciation expense for the six months ended July 3, 2021 and June 27, 2020 was $104 million and $93 million, respectively. Investments Investments consist of the following: July 3, 2021 December 31, 2020 Common stock $ 30 $ 19 Strategic investments, at cost 54 46 Company-owned life insurance policies 79 77 Equity method investments 18 16 $ 181 $ 158 Subsequent to quarter end, on July 16, 2021, the Company invested $50 million in equity securities of NewHold Investment Corp., which completed a business combination with Evolv Technologies, Inc. The equity securities will be carried at fair value with changes in fair value recorded in Other, net within Other income (expense). Other Assets Other assets consist of the following: July 3, 2021 December 31, 2020 Defined benefit plan assets $ 332 $ 283 Non-current contract cost assets (Note 2) 110 105 Other 67 94 $ 509 $ 482 Accrued Liabilities Accrued liabilities consist of the following: July 3, 2021 December 31, 2020 Compensation $ 235 $ 291 Tax liabilities 81 147 Dividend payable 120 120 Trade liabilities 157 164 Operating lease liabilities (Note 3) 129 126 Other 490 463 $ 1,212 $ 1,311 Other Liabilities Other liabilities consist of the following: July 3, 2021 December 31, 2020 Defined benefit plans $ 1,504 $ 1,578 Non-current contract liabilities (Note 2) 296 283 Deferred income taxes 178 180 Other 287 322 $ 2,265 $ 2,363 Stockholders’ Equity (Deficit) Share Repurchase Program: During the three and six months ended July 3, 2021, the Company paid an aggregate of $102 million and $272 million, including transaction costs, to repurchase approximately 0.5 million and 1.5 million shares at an average price of $206.85 and $186.08 per share, respectively. During the three months ended July 3, 2021, the Board of Directors approved a $2.0 billion increase to the share repurchase program. As of July 3, 2021, the Company had $2.4 billion of authority available for future repurchases. Payment of Dividends: During the three months ended July 3, 2021 and June 27, 2020, the Company paid $121 million and $109 million, respectively, in cash dividends to holders of its common stock. During the six months ended July 3, 2021 and June 27, 2020, the Company paid $242 million and $218 million, respectively, in cash dividends to holders of its common stock. Subsequent to the quarter, the Company paid an additional $120 million in cash dividends to holders of its common stock. Accumulated Other Comprehensive Loss The following table displays the changes in Accumulated other comprehensive loss, including amounts reclassified into income, and the affected line items in the Condensed Consolidated Statements of Operations during the three and six months ended July 3, 2021 and June 27, 2020: Three Months Ended Six Months Ended July 3, 2021 June 27, 2020 July 3, 2021 June 27, 2020 Foreign Currency Translation Adjustments: Balance at beginning of period $ (341) $ (548) $ (360) $ (410) Other comprehensive income (loss) before reclassification adjustment 6 75 23 (61) Tax benefit — 3 2 1 Other comprehensive income (loss), net of tax 6 78 25 (60) Balance at end of period $ (335) $ (470) $ (335) $ (470) Defined Benefit Plans: Balance at beginning of period $ (2,069) $ (2,018) $ (2,086) $ (2,030) Reclassification adjustment - Actuarial net losses into Other income (Note 8) 21 19 43 38 Reclassification adjustment - Prior service benefits into Other expense (Note 8) (2) (4) (4) (8) Tax benefit (3) (2) (6) (5) Other comprehensive income, net of tax 16 13 33 25 Balance at end of period $ (2,053) $ (2,005) $ (2,053) $ (2,005) Total Accumulated other comprehensive loss $ (2,388) $ (2,475) $ (2,388) $ (2,475) |
Debt and Credit Facilities
Debt and Credit Facilities | 6 Months Ended |
Jul. 03, 2021 | |
Debt Disclosure [Abstract] | |
Debt and Credit Facilities | Debt and Credit Facilities July 3, 2021 December 31, 2020 3.5% senior notes due 2023 $ — $ 323 4.0% senior notes due 2024 584 583 1.75% senior convertible notes due 2024 999 995 6.5% debentures due 2025 70 70 7.5% debentures due 2025 252 252 4.6% senior notes due 2028 693 692 6.5% debentures due 2028 24 24 4.6% senior notes due 2029 803 803 2.3% senior notes due 2030 892 892 2.75% senior notes due 2031 844 — 6.625% senior notes due 2037 37 37 5.5% senior notes due 2044 396 396 5.22% debentures due 2097 92 92 Other long-term debt 11 18 5,697 5,177 Adjustments for unamortized gains on interest rate swap terminations (2) (2) Less: current portion (9) (12) Long-term debt $ 5,686 $ 5,163 After accelerating the amortization of debt discounts and debt issuance costs, the Company recognized a loss of $18 million related to the redemption in Other, net within Other income (expense) in the Condensed Consolidated Statements of Operations. As of July 3, 2021, the Company had a $2.25 billion syndicated, unsecured revolving credit facility scheduled to mature in March 2026 (the "2021 Motorola Solutions Credit Agreement"). The 2021 Motorola Solutions Credit Agreement includes a letter of credit sub-limit and fronting commitments of $450 million. Borrowings under the facility bear interest at the prime rate plus the applicable margin, or at a spread above the London Interbank Offered Rate ("LIBOR"), at the Company's option. The 2021 Motorola Solutions Credit Agreement includes provisions allowing the Company to replace LIBOR with a replacement benchmark rate in the future under certain conditions defined in the agreement. An annual facility fee is payable on the undrawn amount of the credit line. The interest rate and facility fee are subject to adjustment if the Company's credit rating changes. The Company must comply with certain customary covenants including a maximum leverage ratio, as defined in the 2021 Motorola Solutions Credit Agreement. The Company was in compliance with its financial covenants as of July 3, 2021. The Company has an unsecured commercial paper program, backed by the 2021 Motorola Solutions Credit Agreement, under which the Company may issue unsecured commercial paper notes up to a maximum aggregate principal amount of $2.2 billion outstanding at any one time. Proceeds from the issuances of the notes are expected to be used for general corporate purposes. The notes are issued at a zero-coupon rate and are issued at a discount which reflects the interest component. At maturity, the notes are paid back in full including the interest component. The notes are not redeemable prior to maturity. As of July 3, 2021 the Company had no outstanding debt under the commercial paper program. |
Risk Management
Risk Management | 6 Months Ended |
Jul. 03, 2021 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Risk Management | Risk Management Foreign Currency Risk The Company had outstanding foreign exchange contracts with notional amounts totaling $1.2 billion for each of the periods ended July 3, 2021 and December 31, 2020. The Company does not believe these financial instruments should subject it to undue risk due to foreign exchange movements because gains and losses on these contracts should generally offset gains and losses on the underlying assets, liabilities and transactions. The following table shows the five largest net notional amounts of the positions to buy or sell foreign currency as of July 3, 2021, and the corresponding positions as of December 31, 2020: Notional Amount Net Buy (Sell) by Currency July 3, 2021 December 31, 2020 Euro $ 173 $ 177 Canadian dollar 54 61 British pound 48 86 Chinese renminbi (99) (90) Australian dollar (89) (88) Counterparty Risk The use of derivative financial instruments exposes the Company to counterparty credit risk in the event of non-performance by counterparties. However, the Company’s risk is limited to the fair value of the instruments when the derivative is in an asset position. The Company actively monitors its exposure to credit risk. As of July 3, 2021, all of the counterparties had investment grade credit ratings. As of July 3, 2021, the Company had $5 million of exposure to aggregate credit risk with all counterparties. The following tables summarize the fair values and locations in the Condensed Consolidated Balance Sheets of all derivative financial instruments held by the Company as of July 3, 2021 and December 31, 2020: Fair Values of Derivative Instruments July 3, 2021 Other Current Assets Accrued Liabilities Derivatives designated as hedging instruments: Foreign exchange contracts $ 4 $ 1 Derivatives not designated as hedging instruments: Foreign exchange contracts 1 10 Total derivatives $ 5 $ 11 Fair Values of Derivative Instruments December 31, 2020 Other Current Assets Accrued Liabilities Derivatives designated as hedging instruments: Foreign exchange contracts $ — $ 5 Derivatives not designated as hedging instruments: Foreign exchange contracts 14 3 Total derivatives $ 14 $ 8 The following table summarizes the effect of derivatives on the Company's condensed consolidated financial statements for the three and six months ended July 3, 2021 and June 27, 2020: Financial Statement Location Three Months Ended Six Months Ended Foreign Exchange Contracts July 3, 2021 June 27, 2020 July 3, 2021 June 27, 2020 Effective portion Accumulated other $ (1) $ (11) $ 3 $ 8 Forward points recognized Other income (expense) — 1 1 2 Undesignated derivatives recognized Other income (expense) (1) 12 (9) (4) Net Investment Hedges The Company uses foreign exchange forward contracts with contract terms of 12 to 15 months to hedge against the effect of the British pound and the Euro exchange rate fluctuations against the U.S. dollar on a portion of its net investments in certain European operations. The Company recognizes changes in the fair value of the net investment hedges as a component of foreign currency translation adjustments within other comprehensive income to offset a portion of the change in translated value of the net investments being hedged, until the investments are sold or liquidated. As of July 3, 2021, the Company had €100 million of net investment hedges in certain Euro functional subsidiaries and £125 million of net investment hedges in certain British pound functional subsidiaries. The Company excludes the difference between the spot rate and the forward rate of the forward contract from its assessment of hedge effectiveness. The effect of the excluded components will be amortized on a straight line basis and recognized through interest expense. During the six months ended July 3, 2021, the Company amortized $1 million of income from the excluded components through interest expense. During the three and six months ended June 27, 2020, the Company amortized $1 million and $2 million, respectively, of income from the excluded components through interest expense. |
Income Taxes
Income Taxes | 6 Months Ended |
Jul. 03, 2021 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes At the end of each interim reporting period, the Company makes an estimate of its annual effective income tax rate. Tax expense in interim periods is calculated at the estimated annual effective tax rate plus or minus the tax effects of items of income and expense that are discrete to the period. The estimate used in providing for income taxes on a year-to-date basis may change in subsequent interim periods. The following table provides details of income taxes: Three Months Ended Six Months Ended July 3, 2021 June 27, 2020 July 3, 2021 June 27, 2020 Net earnings before income taxes $ 340 $ 176 $ 630 $ 401 Income tax expense 46 40 90 67 Effective tax rate 14 % 23 % 14 % 17 % The effective tax rate for the three months ended July 3, 2021 of 14% was different from the U.S. federal statutory tax rate of 21% due to state tax expense, offset by a tax benefit related to a partial release of $33 million of a valuation allowance recorded on the U.S. foreign tax credit carryforward. The effective tax rate for the six months ended July 3, 2021 of 14% was different from the U.S. federal statutory tax rate of 21% due to state tax expense, offset by a tax benefit related to a partial release of $33 million of a valuation allowance recorded on the U.S foreign tax credit carryforward and the recognition of excess tax benefits of share-based compensation. The effective tax rates for the three and six months ended June 27, 2020 of 23% and 17%, respectively, were different from the U.S. federal statutory tax rate of 21% due to state tax expense, offset by excess tax benefits on share-based compensation. The effective tax rate for the three and six months ended July 3, 2021 of 14% was lower than the effective tax rates for the three and six months ended June 27, 2020 of 23% and 17%, respectively, primarily due to a tax benefit of $33 million related to a partial release of a valuation allowance recorded on the U.S. foreign tax credit carryforward. |
Retirement and Other Employee B
Retirement and Other Employee Benefits | 6 Months Ended |
Jul. 03, 2021 | |
Retirement Benefits [Abstract] | |
Retirement and Other Employee Benefits | Retirement and Other Employee Benefits Pension and Postretirement Health Care Benefits Plans The net periodic benefits for Pension and Postretirement Health Care Benefits Plans were as follows: U.S. Pension Benefit Plans Non-U.S. Pension Benefit Plans Postretirement Health Care Benefits Plan Three Months Ended July 3, 2021 June 27, 2020 July 3, 2021 June 27, 2020 July 3, 2021 June 27, 2020 Service cost $ — $ — $ — $ 1 $ — $ — Interest cost 29 36 5 7 1 1 Expected return on plan assets (59) (56) (25) (22) (2) (3) Amortization of: Unrecognized net loss 17 14 4 4 — 1 Unrecognized prior service benefit — — — — (2) (4) Net periodic pension benefits $ (13) $ (6) $ (16) $ (10) $ (3) $ (5) U.S. Pension Benefit Plans Non-U.S. Pension Benefit Plans Postretirement Health Care Benefits Plan Six Months Ended July 3, 2021 June 27, 2020 July 3, 2021 June 27, 2020 July 3, 2021 June 27, 2020 Service cost $ — $ — $ 1 $ 1 $ — $ — Interest cost 58 72 10 14 1 1 Expected return on plan assets (118) (112) (50) (42) (5) (5) Amortization of: Unrecognized net loss 34 29 8 7 1 2 Unrecognized prior service benefit — — (1) (1) (3) (7) Net periodic pension benefits $ (26) $ (11) $ (32) $ (21) $ (6) $ (9) |
Share-Based Compensation Plans
Share-Based Compensation Plans | 6 Months Ended |
Jul. 03, 2021 | |
Share-based Payment Arrangement [Abstract] | |
Share-Based Compensation Plans | Share-Based Compensation Plans Compensation expense for the Company’s share-based plans was as follows: Three Months Ended Six Months Ended July 3, 2021 June 27, 2020 July 3, 2021 June 27, 2020 Share-based compensation expense included in: Costs of sales $ 4 $ 4 $ 8 $ 9 Selling, general and administrative expenses 19 18 36 39 Research and development expenditures 8 9 16 21 Share-based compensation expense included in Operating earnings 31 31 60 69 Tax benefit (2) (5) (8) (11) Share-based compensation expense, net of tax $ 29 $ 26 $ 52 $ 58 Decrease in basic earnings per share $ (0.17) $ (0.15) $ (0.31) $ (0.34) Decrease in diluted earnings per share $ (0.17) $ (0.15) $ (0.30) $ (0.33) During the six months ended July 3, 2021, the Company granted 0.4 million restricted stock units (RSUs), 0.1 million performance stock units (PSUs) and 0.1 million market stock units (MSUs) with an aggregate grant-date fair value of $64 million, $15 million, and $10 million, respectively, and 0.2 million stock options and 0.2 million performance options (POs) with an aggregate grant-date fair value of $8 million and $10 million, respectively. The share-based compensation expense will generally be recognized over the vesting period of three years. |
Fair Value Measurements
Fair Value Measurements | 6 Months Ended |
Jul. 03, 2021 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements The fair values of the Company’s financial assets and liabilities by level in the fair value hierarchy as of July 3, 2021 and December 31, 2020 were as follows: July 3, 2021 Level 1 Level 2 Total Assets: Foreign exchange derivative contracts $ — $ 5 $ 5 Common stock 30 — 30 Liabilities: Foreign exchange derivative contracts $ — $ 11 $ 11 December 31, 2020 Level 1 Level 2 Total Assets: Foreign exchange derivative contracts $ — $ 14 $ 14 Common stock 19 — 19 Liabilities: Foreign exchange derivative contracts $ — $ 8 $ 8 The Company had no Level 3 holdings as of July 3, 2021 or December 31, 2020. At July 3, 2021 and December 31, 2020, the Company had $811 million and $448 million, respectively, of investments in money market government and U.S. treasury funds classified (Level 1) as Cash and cash equivalents in its Condensed Consolidated Balance Sheets. The money market funds had quoted market prices that are equivalent to par. Using quoted market prices and market interest rates, the Company determined that the fair value of long-term debt at July 3, 2021 and December 31, 2020 was $6.3 billion and $5.8 billion (Level 2), respectively. All other financial instruments are carried at cost, which is not materially different from the instruments’ fair values. |
Sales of Receivables
Sales of Receivables | 6 Months Ended |
Jul. 03, 2021 | |
Receivables [Abstract] | |
Sales of Receivables | Sales of Receivables Sales of Receivables The following table summarizes the proceeds received from sales of accounts receivable and long-term receivables for the three and six months ended July 3, 2021 and June 27, 2020: Three Months Ended Six Months Ended July 3, 2021 June 27, 2020 July 3, 2021 June 27, 2020 Contract-specific discounting facility $ 36 $ 54 $ 107 $ 98 Accounts receivable sales proceeds 8 34 8 58 Long-term receivables sales proceeds 30 29 84 70 Total proceeds from receivable sales $ 74 $ 117 $ 199 $ 226 At July 3, 2021, the Company had retained servicing obligations for $931 million of long-term receivables, compared to $983 million at December 31, 2020. Servicing obligations are limited to collection activities related to the sales of accounts receivables and long-term receivables. The Company had outstanding commitments to provide long-term financing to third parties totaling $99 million at July 3, 2021, compared to $78 million at December 31, 2020. During the three and six months ended July 3, 2021, the Company utilized a contract-specific receivable discounting facility which began during the six months ended June 27, 2020, resulting in accounts receivable sales of $36 million and $107 million, respectively. The proceeds of the Company's receivable sales are included in Operating activities within the Company's Condensed Consolidated Statements of Cash Flows. |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Jul. 03, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Legal Matters On March 14, 2017, the Company filed a complaint in the U.S. District Court for the Northern District of Illinois (the “Court”) against Hytera Communications Corporation Limited of Shenzhen, China; Hytera America, Inc.; and Hytera Communications America (West), Inc. (collectively, “Hytera”), alleging trade secret theft and copyright infringement and seeking, among other things, injunctive relief, compensatory damages, and punitive damages. On February 14, 2020, the Company announced that a jury decided in the Company's favor in its trade secret theft and copyright infringement case. In connection with this verdict, the jury awarded the Company $345.8 million in compensatory damages and $418.8 million in punitive damages, for a total of $764.6 million. The Court denied Hytera’s motion for a new trial on October 20, 2020. On December 17, 2020, the Court denied the Company’s motion for a permanent injunction, finding instead that Hytera must pay the Company a forward-looking reasonable royalty on products that use the Company’s stolen trade secrets. As of the second quarter of 2021, the parties were unable to agree on a reasonable royalty rate. Therefore, the Court will set the rate. The issue is fully briefed by the parties and awaits the Court's determination. On January 11, 2021, the Court granted Hytera’s motion for certain equitable relief and reduced the $764.6 million judgment award to $543.7 million. That same day, the Court also granted the Company’s motion for pre-judgment interest, although the precise amount of interest owed to the Company by Hytera is still to be determined by the Court. On March 25, 2021, the Court entered rulings favorable to the Company with respect to several of the Company's post-trial motions, including the Company's motion for attorneys' fees and its motion to require Hytera to turn over certain assets in satisfaction of the Company’s judgment award. |
Segment Information
Segment Information | 6 Months Ended |
Jul. 03, 2021 | |
Segment Reporting [Abstract] | |
Segment Information | Segment Information Net Sales by Segment Three Months Ended Six Months Ended July 3, 2021 June 27, 2020 July 3, 2021 June 27, 2020 Products and Systems Integration $ 1,198 $ 968 $ 2,213 $ 1,961 Software and Services 773 650 1,531 1,312 $ 1,971 $ 1,618 $ 3,744 $ 3,273 Operating Earnings by Segment Three Months Ended Six Months Ended July 3, 2021 June 27, 2020 July 3, 2021 June 27, 2020 Products and Systems Integration $ 139 $ 49 $ 216 $ 141 Software and Services 231 169 452 335 Operating earnings 370 218 668 476 Total other expense (30) (42) (38) (75) Earnings before income taxes $ 340 $ 176 $ 630 $ 401 |
Reorganization of Business
Reorganization of Business | 6 Months Ended |
Jul. 03, 2021 | |
Restructuring and Related Activities [Abstract] | |
Reorganization of Business | Reorganization of Business 2021 Charges During the three months ended July 3, 2021, the Company recorded net reorganization of business charges of $9 million, including $6 million of charges in Other charges and $3 million of charges in Costs of sales in the Company's Condensed Consolidated Statements of Operations. Included in the $9 million were charges of $12 million related to employee separation, partially offset by $3 million of reversals for accruals no longer needed. During the six months ended July 3, 2021, the Company recorded net reorganization of business charges of $25 million, including $20 million of charges in Other charges and $5 million of charges in Costs of sales in the Company's Condensed Consolidated Statements of Operations. Included in the $25 million were charges of $30 million related to employee separation, partially offset by $5 million of reversals for accruals no longer needed. The following table displays the net charges incurred by segment: July 3, 2021 Three Months Ended Six Months Ended Products and Systems Integration $ 7 $ 19 Software and Services 2 6 $ 9 $ 25 Reorganization of Businesses Accruals January 1, 2021 Additional Charges Adjustments Amount Used July 3, 2021 $ 79 $ 30 $ (5) $ (56) $ 48 Employee Separation Costs At January 1, 2021, the Company had an accrual of $79 million for employee separation costs. The 2021 additional charges of $30 million represent severance costs for approximately 400 employees. The adjustment of $5 million reflects reversals for accruals no longer needed. The $56 million used reflects cash payments to severed employees. The remaining accrual of $48 million, which is included in Accrued liabilities in the Company’s Condensed Consolidated Balance Sheets at July 3, 2021, is expected to be paid, primarily within one year, to approximately 1,000 employees, who have either been severed or have been notified of their severance and have begun or will begin receiving payments. 2020 Charges During the three months ended June 27, 2020, the Company recorded net reorganization of business charges of $41 million, including $26 million of charges in Other charges and $15 million of charges in Costs of sales in the Company's Condensed Consolidated Statements of Operations. Included in the $41 million were charges of $46 million related to employee separation, partially offset by $5 million of reversals for accruals no longer needed. During the six months ended June 27, 2020, the Company recorded net reorganization of business charges of $59 million, including $38 million of charges in Other charges and $21 million of charges in Costs of sales in the Company's Condensed Consolidated Statements of Operations. Included in the $59 million were charges of $68 million related to employee separation costs and $9 million of reversals for accruals no longer needed. The following table displays the net charges incurred by segment: June 27, 2020 Three Months Ended Six Months Ended Products and Systems Integration $ 33 $ 47 Software and Services 8 12 $ 41 $ 59 |
Intangible Assets and Goodwill
Intangible Assets and Goodwill | 6 Months Ended |
Jul. 03, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible Assets and Goodwill | Intangible Assets and Goodwill Subsequent to quarter end, on July 15, 2021, the Company acquired Openpath, a cloud-based mobile access control provider for $297 million, net of cash acquired. In addition, the Company issued restricted stock at a fair value of $29 million to certain key employees that will be expensed over an average service period of three years. The transaction also includes the potential for the Company to make earn-out payments based on Openpath's achievement of certain financial targets from January 1, 2022 through December 31, 2022. This acquisition expands the Company's ability to combine video security and access control solutions within Video Security and Access Control to help support enterprise customers. Due to the timing of the acquisition, the initial accounting for the acquisition is incomplete. As such, the Company is not able to disclose certain information relating to the acquisition, including the preliminary fair value of assets acquired and liabilities assumed. On August 28, 2020, the Company acquired Callyo, a cloud-based mobile applications provider for law enforcement in North America for $63 million, inclusive of share-based compensation withheld at a fair value of $3 million that will be expensed over an average service period of two years. The acquisition was settled with $61 million in cash, net of cash acquired. This acquisition adds to Motorola Solutions’ existing Command Center Software suite critical mobile technology capabilities that enable information to flow seamlessly from the field to the command center. The Company recognized $38 million of goodwill, $31 million of identifiable intangible assets, and $8 million of net liabilities. The goodwill is not deductible for tax purposes. The identifiable intangible assets were classified as $27 million of customer relationships and $4 million of developed technology that will be amortized over a period of fourteen On July 31, 2020, the Company acquired Pelco, a global provider of video security solutions for a purchase price of $110 million. The acquisition was settled with $107 million of cash, net of cash acquired. The acquisition demonstrates Motorola Solutions’ continued investment in Video Security and Access Control, adding a broad range of products that can be used in a variety of commercial and industrial environments and use cases. The Company recognized $35 million of goodwill, $30 million of identifiable intangible assets, and $42 million of net assets. The goodwill is not deductible for tax purposes. The identifiable intangible assets were classified as $23 million of customer relationships, $4 million of developed technology, and $3 million of trade names that will be amortized over a period of fifteen two On June 16, 2020, the Company acquired IndigoVision for a purchase price of $37 million. The acquisition was settled with $35 million of cash, net of cash acquired and debt assumed. The acquisition complements the Company's Video Security and Access Control technology, providing enhanced geographical reach across a wider customer base. The Company recognized $18 million of goodwill, $22 million of identifiable intangible assets and $5 million of net liabilities. The goodwill is not deductible for tax purposes. The identifiable intangible asset was classified as $22 million of customer relationships that will be amortized over a period of eleven years. The business is a part of both the Products and Systems Integration and Software and Services segments. The purchase accounting was completed as of the second quarter of 2021. On April 30, 2020, the Company acquired a cybersecurity services business for a purchase price of $32 million of cash, net of cash acquired. The Company recognized $23 million of goodwill, $10 million of identifiable intangible assets and $1 million of net liabilities. The goodwill is deductible for tax purposes. The identifiable intangible assets were classified as $8 million of customer relationships and $2 million of developed technology that will be amortized over a period of twelve years and three years, respectively. The acquisition expands the Company’s ability to assist customers with cybersecurity needs through vulnerability assessments, cybersecurity consulting, and managed services including security monitoring of network operations. The business is a part of the Software and Services segment. The purchase accounting was completed as of the first quarter of 2021. On March 3, 2020, the Company acquired a cybersecurity services business for $40 million, inclusive of share-based compensation withheld at a fair value of $6 million that will be expensed over a service period of two years. The acquisition was settled with $33 million of cash, net of cash acquired. The Company recognized $28 million of goodwill, $7 million of intangible assets and $2 million of net liabilities. The goodwill is not deductible for tax purposes. The identifiable intangible asset was classified as a customer relationship that will be amortized over a period of thirteen years. The acquisition expands the Company’s ability to assist customers with cybersecurity needs through vulnerability assessments, cybersecurity consulting, managed services and remediation and response capabilities. The business is a part of the Software and Services segment. The purchase accounting was completed as of the first quarter of 2021. Intangible Assets Amortized intangible assets were comprised of the following: July 3, 2021 December 31, 2020 Gross Accumulated Gross Accumulated Completed technology $ 766 $ 245 $ 766 $ 210 Customer-related 1,354 777 1,335 685 Other intangibles 81 56 80 52 $ 2,201 $ 1,078 $ 2,181 $ 947 Amortization expense on intangible assets was $58 million and $116 million for the three and six months ended July 3, 2021, respectively. Amortization expense on intangible assets was $51 million and $104 million for the three and six months ended June 27, 2020, respectively. As of July 3, 2021, annual amortization expense is estimated to be $209 million in 2021, $206 million in 2022, $108 million in 2023, $83 million in 2024, $73 million in 2025, and $69 million in 2026. Amortized intangible assets were comprised of the following by segment: July 3, 2021 December 31, 2020 Gross Accumulated Gross Accumulated Products and Systems Integration $ 694 $ 154 $ 692 $ 129 Software and Services 1,507 924 1,489 818 $ 2,201 $ 1,078 $ 2,181 $ 947 Goodwill The following table displays a roll-forward of the carrying amount of goodwill by segment from January 1, 2021 to July 3, 2021: Products and Systems Integration Software and Services Total Balance as of January 1, 2021 $ 1,019 $ 1,200 $ 2,219 Purchase accounting adjustments (3) (1) (4) Foreign currency — 4 4 Balance as of July 3, 2021 $ 1,016 $ 1,203 $ 2,219 |
Basis of Presentation (Policies
Basis of Presentation (Policies) | 6 Months Ended |
Jul. 03, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | The condensed consolidated financial statements as of July 3, 2021 and for the three and six months ended July 3, 2021 and June 27, 2020 include, in the opinion of management, all adjustments (consisting of normal recurring adjustments and reclassifications) necessary to state fairly the Condensed Consolidated Balance Sheets, Statements of Operations, Statements of Comprehensive Income, Statements of Stockholders' Equity (Deficit), and Statements of Cash Flows of Motorola Solutions, Inc. (“Motorola Solutions” or the “Company”) for all periods presented. The Company operates on a 52-week fiscal year, with each fiscal year ending on December 31. With respect to each fiscal quarter, the Company operates on a 13-week fiscal quarter, with all fiscal quarters ending on a Saturday. Certain information and footnote disclosures normally included in financial statements prepared in accordance with United States generally accepted accounting principles (“U.S. GAAP”) have been condensed or omitted. These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s Form 10-K for the year ended December 31, 2020 (the "Form 10-K"). The results of operations for the three and six months ended July 3, 2021 are not necessarily indicative of the operating results to be expected for the full year. The preparation of financial statements in conformity with U.S. GAAP requires management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimates. |
Recent Accounting Pronouncements and Recently Adopted Accounting Pronouncements | Recent Accounting Pronouncements In August 2020, the FASB issued ASU No. 2020-06, "Debt - Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging-Contracts in Entity’s Own Equity (Subtopic 815-40) - Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity," which simplifies the accounting for certain financial instruments with characteristics of liabilities and equity, including convertible instruments. The new guidance removes the separation models for convertible debt with a cash conversion feature or a beneficial conversion feature. In addition, the new standard provides guidance on calculating the dilutive impact of convertible debt on earnings per share. The ASU clarifies that the average market price should be used to calculate the diluted earnings per share denominator when the exercise price or the number of shares that may be issued is variable. The ASU is effective for the Company on January 1, 2022, including interim periods, with early adoption permitted. The ASU permits the use of either a full or modified retrospective method of adoption. The Company is still evaluating the impact of the adoption of this ASU on its financial statements and disclosures. Recently Adopted Accounting Pronouncements In December 2019, the FASB issued ASU No. 2019-12, “Income Taxes (Topic 740),” which simplifies the accounting for income taxes by removing certain exceptions and streamlining other areas of accounting for income taxes. Portions of the amendment within the ASU require retrospective, modified retrospective or prospective adoption methods. The Company adopted ASU No. 2019-12 as of January 1, 2021 on a prospective basis and the adoption of this standard did not have a material impact on its financial statements and disclosures. |
Revenue from Contracts with C_2
Revenue from Contracts with Customers (Tables) | 6 Months Ended |
Jul. 03, 2021 | |
Revenue from Contract with Customer [Abstract] | |
Disaggregation of Revenue | The following table summarizes the disaggregation of the Company's revenue by segment, region, major products and services and customer type for the three and six months ended July 3, 2021 and June 27, 2020, consistent with the information reviewed by the Company's chief operating decision maker for evaluating the financial performance of the Company's reportable segments: Three Months Ended July 3, 2021 June 27, 2020 (In millions) Products and Systems Integration Software and Services Total Products and Systems Integration Software and Services Total Regions: North America $ 869 $ 443 $ 1,312 $ 719 $ 374 $ 1,093 International 329 330 659 249 276 525 $ 1,198 $ 773 $ 1,971 $ 968 $ 650 $ 1,618 Major Products and Services: LMR $ 986 $ 545 $ 1,531 $ 836 $ 481 $ 1,317 Video Security and Access Control 212 94 306 132 52 184 Command Center Software — 134 134 — 117 117 $ 1,198 $ 773 $ 1,971 $ 968 $ 650 $ 1,618 Customer Types: Direct $ 706 $ 706 $ 1,412 $ 634 $ 611 $ 1,245 Indirect 492 67 559 334 39 373 $ 1,198 $ 773 $ 1,971 $ 968 $ 650 $ 1,618 Six Months Ended July 3, 2021 June 27, 2020 Products and Systems Integration Software and Services Total Products and Systems Integration Software and Services Total Regions: North America $ 1,611 $ 886 $ 2,497 $ 1,467 $ 742 $ 2,209 International 602 645 1,247 494 570 1,064 $ 2,213 $ 1,531 $ 3,744 $ 1,961 $ 1,312 $ 3,273 Major Products and Services: LMR $ 1,836 $ 1,095 $ 2,931 $ 1,696 $ 970 $ 2,666 Video Security and Access Control 377 182 559 265 119 384 Command Center Software — 254 254 — 223 223 $ 2,213 $ 1,531 $ 3,744 $ 1,961 $ 1,312 $ 3,273 Customer Types: Direct $ 1,310 $ 1,396 $ 2,706 $ 1,275 $ 1,232 $ 2,507 Indirect 903 135 1,038 686 80 766 $ 2,213 $ 1,531 $ 3,744 $ 1,961 $ 1,312 $ 3,273 |
Contract Balances | (In millions) July 3, 2021 December 31, 2020 Accounts receivable, net $ 1,169 $ 1,390 Contract assets 757 933 Contract liabilities 1,416 1,554 Non-current contract liabilities 296 283 |
Contract Cost Balances | (In millions) July 3, 2021 December 31, 2020 Current contract cost assets $ 30 $ 23 Non-current contract cost assets 110 105 |
Leases (Tables)
Leases (Tables) | 6 Months Ended |
Jul. 03, 2021 | |
Leases [Abstract] | |
Components of Lease Expense and Other Information | Three Months Ended Six Months Ended (in millions) July 3, 2021 June 27, 2020 July 3, 2021 June 27, 2020 Lease expense: Operating lease cost $ 34 $ 33 $ 67 $ 67 Finance lease cost Amortization of right-of-use assets 3 3 6 6 Interest on lease liabilities — — — 1 Total finance lease cost 3 3 6 7 Short-term lease cost 1 1 2 1 Variable cost 9 9 18 17 Sublease income (1) (1) (2) (2) Net lease expense $ 46 $ 45 $ 91 $ 90 Six Months Ended (in millions) July 3, 2021 June 27, 2020 Supplemental cash flow information: Net cash used for operating activities related to operating leases $ 95 $ 84 Net cash used for operating activities related to finance leases — 1 Net cash used for financing activities related to finance leases 7 6 Assets obtained in exchange for lease liabilities: Operating leases $ 22 $ 24 July 3, 2021 December 31, 2020 Weighted average remaining lease terms (years): Operating leases 6 6 Finance leases 1 2 Weighted average discount rate: Operating leases 3.16 % 3.30 % Finance leases 4.14 % 4.21 % |
Lease Assets and Liabilities | (in millions) Statement Line Classification July 3, 2021 December 31, 2020 Assets: Operating lease assets Operating lease assets $ 430 $ 468 Finance lease assets Property, plant, and equipment, net 24 30 $ 454 $ 498 Current liabilities: Operating lease liabilities Accrued liabilities $ 129 $ 126 Finance lease liabilities Current portion of long-term debt 8 11 $ 137 $ 137 Non-current liabilities: Operating lease liabilities Operating lease liabilities $ 340 $ 402 Finance lease liabilities Long-term debt 2 5 $ 342 $ 407 |
Future Lease Payments, Operating | July 3, 2021 (in millions) Operating Leases Finance Leases Total Remainder of 2021 $ 50 $ 5 $ 55 2022 135 5 140 2023 79 1 80 2024 64 — 64 2025 51 — 51 Thereafter 140 — 140 Total lease payments 519 11 530 Less: interest 50 1 51 Present value of lease liabilities $ 469 $ 10 $ 479 |
Future Lease Payments, Finance | July 3, 2021 (in millions) Operating Leases Finance Leases Total Remainder of 2021 $ 50 $ 5 $ 55 2022 135 5 140 2023 79 1 80 2024 64 — 64 2025 51 — 51 Thereafter 140 — 140 Total lease payments 519 11 530 Less: interest 50 1 51 Present value of lease liabilities $ 469 $ 10 $ 479 |
Other Financial Data (Tables)
Other Financial Data (Tables) | 6 Months Ended |
Jul. 03, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Other Charges (Income) | Other charges (income) included in Operating earnings consist of the following: Three Months Ended Six Months Ended July 3, 2021 June 27, 2020 July 3, 2021 June 27, 2020 Other charges: Intangibles amortization (Note 15) $ 58 $ 51 $ 116 $ 104 Reorganization of business (Note 14) 6 26 20 38 Operating lease asset impairments — — 7 — Acquisition-related transaction fees 3 1 4 3 Losses on legal settlements 3 7 3 9 Fixed asset impairment — 5 — 5 Gain on sale of property, plant and equipment — — — (50) $ 70 $ 90 $ 150 $ 109 |
Other Income (Expense) | Interest expense, net, and Other, net, both included in Other income (expense), consist of the following: Three Months Ended Six Months Ended July 3, 2021 June 27, 2020 July 3, 2021 June 27, 2020 Interest income (expense), net: Interest expense $ (46) $ (60) $ (102) $ (114) Interest income 2 2 4 5 $ (44) $ (58) $ (98) (109) Other, net: Net periodic pension and postretirement benefit (Note 8) $ 31 $ 19 $ 60 $ 39 Loss from the extinguishment of long-term debt (Note 5) (18) — (18) — Foreign currency gain (loss) (6) (21) 8 (3) Gain (loss) on derivative instruments (1) 12 (9) (4) Gains on equity method investments 2 — 3 — Fair value adjustments to equity investments 8 4 13 5 Other (2) 2 3 (3) $ 14 $ 16 $ 60 $ 34 |
Earnings Per Common Share | The computation of basic and diluted earnings per common share is as follows: Amounts attributable to Motorola Solutions, Inc. common stockholders Three Months Ended Six Months Ended July 3, 2021 June 27, 2020 July 3, 2021 June 27, 2020 Basic earnings per common share: Earnings $ 293 $ 135 $ 537 $ 332 Weighted average common shares outstanding 169.6 170.0 169.4 170.3 Per share amount $ 1.73 $ 0.79 $ 3.17 $ 1.95 Diluted earnings per common share: Earnings $ 293 $ 135 $ 537 $ 332 Weighted average common shares outstanding 169.6 170.0 169.4 170.3 Add effect of dilutive securities: Share-based awards 3.5 3.6 3.7 4.5 1.75% senior convertible notes — — — — Diluted weighted average common shares outstanding 173.1 173.6 173.1 174.8 Per share amount $ 1.69 $ 0.78 $ 3.10 $ 1.90 |
Accounts Receivable, Net | Accounts receivable, net, consists of the following: July 3, 2021 December 31, 2020 Accounts receivable $ 1,244 $ 1,465 Less allowance for credit losses (75) (75) $ 1,169 $ 1,390 |
Inventories, Net | Inventories, net, consist of the following: July 3, 2021 December 31, 2020 Finished goods $ 261 $ 271 Work-in-process and production materials 429 360 690 631 Less inventory reserves (131) (123) $ 559 $ 508 |
Other Current Assets | Other current assets consist of the following: July 3, 2021 December 31, 2020 Current contract cost assets (Note 2) $ 30 $ 23 Tax-related deposits 44 52 Other 180 167 $ 254 $ 242 |
Property, Plant and Equipment, Net | Property, plant and equipment, net, consist of the following: July 3, 2021 December 31, 2020 Land $ 4 $ 6 Leasehold improvements 473 439 Machinery and equipment 2,378 2,276 2,855 2,721 Less accumulated depreciation (1,827) (1,699) $ 1,028 $ 1,022 |
Investments | Investments consist of the following: July 3, 2021 December 31, 2020 Common stock $ 30 $ 19 Strategic investments, at cost 54 46 Company-owned life insurance policies 79 77 Equity method investments 18 16 $ 181 $ 158 |
Other Assets | Other assets consist of the following: July 3, 2021 December 31, 2020 Defined benefit plan assets $ 332 $ 283 Non-current contract cost assets (Note 2) 110 105 Other 67 94 $ 509 $ 482 |
Accrued Liabilities | Accrued liabilities consist of the following: July 3, 2021 December 31, 2020 Compensation $ 235 $ 291 Tax liabilities 81 147 Dividend payable 120 120 Trade liabilities 157 164 Operating lease liabilities (Note 3) 129 126 Other 490 463 $ 1,212 $ 1,311 |
Other Liabilities | Other liabilities consist of the following: July 3, 2021 December 31, 2020 Defined benefit plans $ 1,504 $ 1,578 Non-current contract liabilities (Note 2) 296 283 Deferred income taxes 178 180 Other 287 322 $ 2,265 $ 2,363 |
Accumulated Other Comprehensive Loss | The following table displays the changes in Accumulated other comprehensive loss, including amounts reclassified into income, and the affected line items in the Condensed Consolidated Statements of Operations during the three and six months ended July 3, 2021 and June 27, 2020: Three Months Ended Six Months Ended July 3, 2021 June 27, 2020 July 3, 2021 June 27, 2020 Foreign Currency Translation Adjustments: Balance at beginning of period $ (341) $ (548) $ (360) $ (410) Other comprehensive income (loss) before reclassification adjustment 6 75 23 (61) Tax benefit — 3 2 1 Other comprehensive income (loss), net of tax 6 78 25 (60) Balance at end of period $ (335) $ (470) $ (335) $ (470) Defined Benefit Plans: Balance at beginning of period $ (2,069) $ (2,018) $ (2,086) $ (2,030) Reclassification adjustment - Actuarial net losses into Other income (Note 8) 21 19 43 38 Reclassification adjustment - Prior service benefits into Other expense (Note 8) (2) (4) (4) (8) Tax benefit (3) (2) (6) (5) Other comprehensive income, net of tax 16 13 33 25 Balance at end of period $ (2,053) $ (2,005) $ (2,053) $ (2,005) Total Accumulated other comprehensive loss $ (2,388) $ (2,475) $ (2,388) $ (2,475) |
Debt and Credit Facilities (Tab
Debt and Credit Facilities (Tables) | 6 Months Ended |
Jul. 03, 2021 | |
Debt Disclosure [Abstract] | |
Schedule of Long-term Debt Instruments | July 3, 2021 December 31, 2020 3.5% senior notes due 2023 $ — $ 323 4.0% senior notes due 2024 584 583 1.75% senior convertible notes due 2024 999 995 6.5% debentures due 2025 70 70 7.5% debentures due 2025 252 252 4.6% senior notes due 2028 693 692 6.5% debentures due 2028 24 24 4.6% senior notes due 2029 803 803 2.3% senior notes due 2030 892 892 2.75% senior notes due 2031 844 — 6.625% senior notes due 2037 37 37 5.5% senior notes due 2044 396 396 5.22% debentures due 2097 92 92 Other long-term debt 11 18 5,697 5,177 Adjustments for unamortized gains on interest rate swap terminations (2) (2) Less: current portion (9) (12) Long-term debt $ 5,686 $ 5,163 |
Risk Management (Tables)
Risk Management (Tables) | 6 Months Ended |
Jul. 03, 2021 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of Largest Net Notional Amounts of the Positions to Buy or Sell Foreign Currency | The following table shows the five largest net notional amounts of the positions to buy or sell foreign currency as of July 3, 2021, and the corresponding positions as of December 31, 2020: Notional Amount Net Buy (Sell) by Currency July 3, 2021 December 31, 2020 Euro $ 173 $ 177 Canadian dollar 54 61 British pound 48 86 Chinese renminbi (99) (90) Australian dollar (89) (88) |
Summary of Fair Values and Location In Condensed Consolidated Balance Sheet | The following tables summarize the fair values and locations in the Condensed Consolidated Balance Sheets of all derivative financial instruments held by the Company as of July 3, 2021 and December 31, 2020: Fair Values of Derivative Instruments July 3, 2021 Other Current Assets Accrued Liabilities Derivatives designated as hedging instruments: Foreign exchange contracts $ 4 $ 1 Derivatives not designated as hedging instruments: Foreign exchange contracts 1 10 Total derivatives $ 5 $ 11 Fair Values of Derivative Instruments December 31, 2020 Other Current Assets Accrued Liabilities Derivatives designated as hedging instruments: Foreign exchange contracts $ — $ 5 Derivatives not designated as hedging instruments: Foreign exchange contracts 14 3 Total derivatives $ 14 $ 8 |
Summary of Derivative Instruments and the Effect on the Condensed Consolidated Statements of Operations | The following table summarizes the effect of derivatives on the Company's condensed consolidated financial statements for the three and six months ended July 3, 2021 and June 27, 2020: Financial Statement Location Three Months Ended Six Months Ended Foreign Exchange Contracts July 3, 2021 June 27, 2020 July 3, 2021 June 27, 2020 Effective portion Accumulated other $ (1) $ (11) $ 3 $ 8 Forward points recognized Other income (expense) — 1 1 2 Undesignated derivatives recognized Other income (expense) (1) 12 (9) (4) |
Income Taxes (Tables)
Income Taxes (Tables) | 6 Months Ended |
Jul. 03, 2021 | |
Income Tax Disclosure [Abstract] | |
Schedule of Effective Income Tax Rate Reconciliation | The following table provides details of income taxes: Three Months Ended Six Months Ended July 3, 2021 June 27, 2020 July 3, 2021 June 27, 2020 Net earnings before income taxes $ 340 $ 176 $ 630 $ 401 Income tax expense 46 40 90 67 Effective tax rate 14 % 23 % 14 % 17 % |
Retirement and Other Employee_2
Retirement and Other Employee Benefits (Tables) | 6 Months Ended |
Jul. 03, 2021 | |
Retirement Benefits [Abstract] | |
Schedule of Net Benefit Plan Costs | The net periodic benefits for Pension and Postretirement Health Care Benefits Plans were as follows: U.S. Pension Benefit Plans Non-U.S. Pension Benefit Plans Postretirement Health Care Benefits Plan Three Months Ended July 3, 2021 June 27, 2020 July 3, 2021 June 27, 2020 July 3, 2021 June 27, 2020 Service cost $ — $ — $ — $ 1 $ — $ — Interest cost 29 36 5 7 1 1 Expected return on plan assets (59) (56) (25) (22) (2) (3) Amortization of: Unrecognized net loss 17 14 4 4 — 1 Unrecognized prior service benefit — — — — (2) (4) Net periodic pension benefits $ (13) $ (6) $ (16) $ (10) $ (3) $ (5) U.S. Pension Benefit Plans Non-U.S. Pension Benefit Plans Postretirement Health Care Benefits Plan Six Months Ended July 3, 2021 June 27, 2020 July 3, 2021 June 27, 2020 July 3, 2021 June 27, 2020 Service cost $ — $ — $ 1 $ 1 $ — $ — Interest cost 58 72 10 14 1 1 Expected return on plan assets (118) (112) (50) (42) (5) (5) Amortization of: Unrecognized net loss 34 29 8 7 1 2 Unrecognized prior service benefit — — (1) (1) (3) (7) Net periodic pension benefits $ (26) $ (11) $ (32) $ (21) $ (6) $ (9) |
Share-Based Compensation Plans
Share-Based Compensation Plans (Tables) | 6 Months Ended |
Jul. 03, 2021 | |
Share-based Payment Arrangement [Abstract] | |
Schedule of Compensation Expense | Compensation expense for the Company’s share-based plans was as follows: Three Months Ended Six Months Ended July 3, 2021 June 27, 2020 July 3, 2021 June 27, 2020 Share-based compensation expense included in: Costs of sales $ 4 $ 4 $ 8 $ 9 Selling, general and administrative expenses 19 18 36 39 Research and development expenditures 8 9 16 21 Share-based compensation expense included in Operating earnings 31 31 60 69 Tax benefit (2) (5) (8) (11) Share-based compensation expense, net of tax $ 29 $ 26 $ 52 $ 58 Decrease in basic earnings per share $ (0.17) $ (0.15) $ (0.31) $ (0.34) Decrease in diluted earnings per share $ (0.17) $ (0.15) $ (0.30) $ (0.33) |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 6 Months Ended |
Jul. 03, 2021 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Company's Financial Assets and Liabilities | The fair values of the Company’s financial assets and liabilities by level in the fair value hierarchy as of July 3, 2021 and December 31, 2020 were as follows: July 3, 2021 Level 1 Level 2 Total Assets: Foreign exchange derivative contracts $ — $ 5 $ 5 Common stock 30 — 30 Liabilities: Foreign exchange derivative contracts $ — $ 11 $ 11 December 31, 2020 Level 1 Level 2 Total Assets: Foreign exchange derivative contracts $ — $ 14 $ 14 Common stock 19 — 19 Liabilities: Foreign exchange derivative contracts $ — $ 8 $ 8 |
Sales of Receivables (Tables)
Sales of Receivables (Tables) | 6 Months Ended |
Jul. 03, 2021 | |
Receivables [Abstract] | |
Proceeds Received from Non-Recourse Sales of Accounts Receivable and Long-Term Receivables | The following table summarizes the proceeds received from sales of accounts receivable and long-term receivables for the three and six months ended July 3, 2021 and June 27, 2020: Three Months Ended Six Months Ended July 3, 2021 June 27, 2020 July 3, 2021 June 27, 2020 Contract-specific discounting facility $ 36 $ 54 $ 107 $ 98 Accounts receivable sales proceeds 8 34 8 58 Long-term receivables sales proceeds 30 29 84 70 Total proceeds from receivable sales $ 74 $ 117 $ 199 $ 226 |
Segment Information (Tables)
Segment Information (Tables) | 6 Months Ended |
Jul. 03, 2021 | |
Segment Reporting [Abstract] | |
Net Sales and Operating Earnings by Segment | Net Sales by Segment Three Months Ended Six Months Ended July 3, 2021 June 27, 2020 July 3, 2021 June 27, 2020 Products and Systems Integration $ 1,198 $ 968 $ 2,213 $ 1,961 Software and Services 773 650 1,531 1,312 $ 1,971 $ 1,618 $ 3,744 $ 3,273 Operating Earnings by Segment Three Months Ended Six Months Ended July 3, 2021 June 27, 2020 July 3, 2021 June 27, 2020 Products and Systems Integration $ 139 $ 49 $ 216 $ 141 Software and Services 231 169 452 335 Operating earnings 370 218 668 476 Total other expense (30) (42) (38) (75) Earnings before income taxes $ 340 $ 176 $ 630 $ 401 |
Reorganization of Business (Tab
Reorganization of Business (Tables) | 6 Months Ended |
Jul. 03, 2021 | |
Restructuring and Related Activities [Abstract] | |
Restructuring and Related Activities Reportable Segment | The following table displays the net charges incurred by segment: July 3, 2021 Three Months Ended Six Months Ended Products and Systems Integration $ 7 $ 19 Software and Services 2 6 $ 9 $ 25 The following table displays the net charges incurred by segment: June 27, 2020 Three Months Ended Six Months Ended Products and Systems Integration $ 33 $ 47 Software and Services 8 12 $ 41 $ 59 |
Reorganization of Businesses Accruals | January 1, 2021 Additional Charges Adjustments Amount Used July 3, 2021 $ 79 $ 30 $ (5) $ (56) $ 48 |
Intangible Assets and Goodwill
Intangible Assets and Goodwill (Tables) | 6 Months Ended |
Jul. 03, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible Assets | Amortized intangible assets were comprised of the following: July 3, 2021 December 31, 2020 Gross Accumulated Gross Accumulated Completed technology $ 766 $ 245 $ 766 $ 210 Customer-related 1,354 777 1,335 685 Other intangibles 81 56 80 52 $ 2,201 $ 1,078 $ 2,181 $ 947 |
Amortized Intangible Assets | Amortized intangible assets were comprised of the following by segment: July 3, 2021 December 31, 2020 Gross Accumulated Gross Accumulated Products and Systems Integration $ 694 $ 154 $ 692 $ 129 Software and Services 1,507 924 1,489 818 $ 2,201 $ 1,078 $ 2,181 $ 947 |
Goodwill | The following table displays a roll-forward of the carrying amount of goodwill by segment from January 1, 2021 to July 3, 2021: Products and Systems Integration Software and Services Total Balance as of January 1, 2021 $ 1,019 $ 1,200 $ 2,219 Purchase accounting adjustments (3) (1) (4) Foreign currency — 4 4 Balance as of July 3, 2021 $ 1,016 $ 1,203 $ 2,219 |
Basis of Presentation - Recent
Basis of Presentation - Recent Acquisitions (Details) $ in Millions | Jul. 15, 2021USD ($) | Aug. 28, 2020USD ($) | Jul. 31, 2020USD ($) | Jun. 16, 2020USD ($) | Apr. 30, 2020USD ($) | Mar. 03, 2020USD ($) | Jul. 03, 2021product_and_service |
Business Acquisition [Line Items] | |||||||
Major products and services | product_and_service | 3 | ||||||
Callyo | |||||||
Business Acquisition [Line Items] | |||||||
Cash paid for acquisition, net of cash acquired | $ 61 | ||||||
Share-based compensation acquired | $ 3 | ||||||
Share-based compensation withheld, average service period | 2 years | ||||||
Consideration transferred | $ 63 | ||||||
Pelco, Inc. | |||||||
Business Acquisition [Line Items] | |||||||
Cash paid for acquisition, net of cash acquired | $ 107 | ||||||
Consideration transferred | $ 110 | ||||||
IndigoVision | |||||||
Business Acquisition [Line Items] | |||||||
Cash paid for acquisition, net of cash acquired | $ 35 | ||||||
Consideration transferred | $ 37 | ||||||
Cybersecurity Services Business | |||||||
Business Acquisition [Line Items] | |||||||
Cash paid for acquisition, net of cash acquired | $ 32 | $ 33 | |||||
Share-based compensation acquired | $ 6 | ||||||
Share-based compensation withheld, average service period | 2 years | ||||||
Consideration transferred | $ 40 | ||||||
Openpath | Subsequent Event | |||||||
Business Acquisition [Line Items] | |||||||
Cash paid for acquisition, net of cash acquired | $ 297 | ||||||
Share-based compensation acquired | $ 29 | ||||||
Share-based compensation withheld, average service period | 3 years |
Revenue from Contracts with C_3
Revenue from Contracts with Customers - Disaggregation of Revenue (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jul. 03, 2021 | Jun. 27, 2020 | Jul. 03, 2021 | Jun. 27, 2020 | |
Disaggregation of Revenue [Line Items] | ||||
Net sales | $ 1,971 | $ 1,618 | $ 3,744 | $ 3,273 |
Direct | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 1,412 | 1,245 | 2,706 | 2,507 |
Indirect | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 559 | 373 | 1,038 | 766 |
LMR | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 1,531 | 1,317 | 2,931 | 2,666 |
Video Security and Access Control | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 306 | 184 | 559 | 384 |
Command Center Software | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 134 | 117 | 254 | 223 |
North America | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 1,312 | 1,093 | 2,497 | 2,209 |
International | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 659 | 525 | 1,247 | 1,064 |
Products and Systems Integration | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 1,198 | 968 | 2,213 | 1,961 |
Products and Systems Integration | Direct | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 706 | 634 | 1,310 | 1,275 |
Products and Systems Integration | Indirect | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 492 | 334 | 903 | 686 |
Products and Systems Integration | LMR | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 986 | 836 | 1,836 | 1,696 |
Products and Systems Integration | Video Security and Access Control | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 212 | 132 | 377 | 265 |
Products and Systems Integration | Command Center Software | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 0 | 0 | 0 | 0 |
Products and Systems Integration | North America | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 869 | 719 | 1,611 | 1,467 |
Products and Systems Integration | International | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 329 | 249 | 602 | 494 |
Software and Services | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 773 | 650 | 1,531 | 1,312 |
Software and Services | Direct | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 706 | 611 | 1,396 | 1,232 |
Software and Services | Indirect | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 67 | 39 | 135 | 80 |
Software and Services | LMR | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 545 | 481 | 1,095 | 970 |
Software and Services | Video Security and Access Control | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 94 | 52 | 182 | 119 |
Software and Services | Command Center Software | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 134 | 117 | 254 | 223 |
Software and Services | North America | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 443 | 374 | 886 | 742 |
Software and Services | International | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | $ 330 | $ 276 | $ 645 | $ 570 |
Revenue from Contracts with C_4
Revenue from Contracts with Customers - Remaining Performance Obligation, Future Expected (Details) $ in Billions | Jul. 03, 2021USD ($) |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, remaining performance obligation | $ 7.1 |
Products and Systems Integration | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, remaining performance obligation | 3.3 |
Software and Services | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, remaining performance obligation | 3.8 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2021-07-04 | Products and Systems Integration | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, remaining performance obligation | $ 1.7 |
Expected timing of satisfaction, period | 12 months |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2021-07-04 | Managed and Support Services | Software and Services | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, remaining performance obligation | $ 1.5 |
Expected timing of satisfaction, period | 12 months |
Revenue from Contracts with C_5
Revenue from Contracts with Customers - Contract Balances (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |||
Jul. 03, 2021 | Jun. 27, 2020 | Jul. 03, 2021 | Jun. 27, 2020 | Dec. 31, 2020 | |
Contract with Customer, Asset and Liability [Abstract] | |||||
Accounts receivable, net | $ 1,169 | $ 1,169 | $ 1,390 | ||
Contract assets | 757 | 757 | 933 | ||
Contract liabilities | 1,416 | 1,416 | 1,554 | ||
Non-current contract liabilities | 296 | 296 | $ 283 | ||
Contract with customer, liability, revenue recognized | 483 | $ 370 | 705 | $ 631 | |
Contract with customer, performance obligation adjustments | 10 | 12 | 15 | 34 | |
Impairment losses | $ 0 | $ 0 | $ 0 | $ 0 |
Revenue from Contracts with C_6
Revenue from Contracts with Customers - Contract Cost Balances (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |||
Jul. 03, 2021 | Jun. 27, 2020 | Jul. 03, 2021 | Jun. 27, 2020 | Dec. 31, 2020 | |
Revenue from Contract with Customer [Abstract] | |||||
Current contract cost assets | $ 30 | $ 30 | $ 23 | ||
Non-current contract cost assets | 110 | 110 | $ 105 | ||
Contract cost, amortization | $ 12 | $ 11 | $ 25 | $ 22 |
Leases - Operating Expense (Det
Leases - Operating Expense (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jul. 03, 2021 | Jun. 27, 2020 | Jul. 03, 2021 | Jun. 27, 2020 | |
Lease expense: | ||||
Operating lease cost | $ 34 | $ 33 | $ 67 | $ 67 |
Finance lease cost | ||||
Amortization of right-of-use assets | 3 | 3 | 6 | 6 |
Interest on lease liabilities | 0 | 0 | 0 | 1 |
Total finance lease cost | 3 | 3 | 6 | 7 |
Short-term lease cost | 1 | 1 | 2 | 1 |
Variable cost | 9 | 9 | 18 | 17 |
Sublease income | (1) | (1) | (2) | (2) |
Net lease expense | $ 46 | $ 45 | $ 91 | $ 90 |
Leases - Assets and Liabilities
Leases - Assets and Liabilities (Details) - USD ($) $ in Millions | Jul. 03, 2021 | Dec. 31, 2020 |
Assets: | ||
Operating lease assets | $ 430 | $ 468 |
Finance Lease, Right-of-Use Asset, Statement of Financial Position [Extensible Enumeration] | Property, plant and equipment, net | Property, plant and equipment, net |
Finance lease assets | $ 24 | $ 30 |
Total lease assets | $ 454 | $ 498 |
Current liabilities: | ||
Operating Lease, Liability, Current, Statement of Financial Position [Extensible Enumeration] | Accrued liabilities | Accrued liabilities |
Operating lease liabilities | $ 129 | $ 126 |
Finance Lease, Liability, Current, Statement of Financial Position [Extensible Enumeration] | Current portion of long-term debt | Current portion of long-term debt |
Finance lease liabilities | $ 8 | $ 11 |
Total lease liabilities, current | 137 | 137 |
Non-current liabilities: | ||
Operating lease liabilities | $ 340 | $ 402 |
Finance Lease, Liability, Noncurrent, Statement of Financial Position [Extensible Enumeration] | Long-term debt | Long-term debt |
Finance lease liabilities | $ 2 | $ 5 |
Total lease liabilities, non-current | $ 342 | $ 407 |
Leases - Cash Flows (Details)
Leases - Cash Flows (Details) - USD ($) $ in Millions | 6 Months Ended | |
Jul. 03, 2021 | Jun. 27, 2020 | |
Supplemental cash flow information: | ||
Net cash used for operating activities related to operating leases | $ 95 | $ 84 |
Net cash used for operating activities related to finance leases | 0 | 1 |
Net cash used for financing activities related to finance leases | 7 | 6 |
Assets obtained in exchange for lease liabilities: | ||
Operating leases | $ 22 | $ 24 |
Leases - Terms (Details)
Leases - Terms (Details) | Jul. 03, 2021 | Dec. 31, 2020 |
Leases [Abstract] | ||
Weighted average remaining lease terms, operating leases | 6 years | 6 years |
Weighted average remaining lease terms, finance leases | 1 year | 2 years |
Weighted average discount rate, operating leases | 3.16% | 3.30% |
Weighted average discount rate, finance leases | 4.14% | 4.21% |
Leases - Future Payments (Detai
Leases - Future Payments (Details) $ in Millions | Jul. 03, 2021USD ($) |
Operating Leases | |
Remainder of 2021 | $ 50 |
2022 | 135 |
2023 | 79 |
2024 | 64 |
2025 | 51 |
Thereafter | 140 |
Total lease payments | 519 |
Less: interest | 50 |
Present value of lease liabilities | 469 |
Finance Leases | |
Remainder of 2021 | 5 |
2022 | 5 |
2023 | 1 |
2024 | 0 |
2025 | 0 |
Thereafter | 0 |
Total lease payments | 11 |
Less: interest | 1 |
Present value of lease liabilities | 10 |
Total | |
Remainder of 2021 | 55 |
2022 | 140 |
2023 | 80 |
2024 | 64 |
2025 | 51 |
Thereafter | 140 |
Total lease payments | 530 |
Less: interest | 51 |
Present value of lease liabilities | $ 479 |
Other Financial Data - Other Ch
Other Financial Data - Other Charges (Income) (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jul. 03, 2021 | Jun. 27, 2020 | Jul. 03, 2021 | Jun. 27, 2020 | |
Other charges: | ||||
Intangibles amortization (Note 15) | $ 58 | $ 51 | $ 116 | $ 104 |
Reorganization of business (Note 14) | 6 | 26 | 20 | 38 |
Operating lease asset impairments | 0 | 0 | 7 | 0 |
Acquisition-related transaction fees | 3 | 1 | 4 | 3 |
Losses on legal settlements | 3 | 7 | 3 | 9 |
Fixed asset impairment | 0 | 5 | 0 | 5 |
Gain on sale of property, plant and equipment | 0 | 0 | 0 | (50) |
Other charges | $ 70 | $ 90 | $ 150 | $ 109 |
Other Financial Data - Other _2
Other Financial Data - Other Charges (Income) - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jul. 03, 2021 | Jun. 27, 2020 | Jul. 03, 2021 | Jun. 27, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||||
Operating lease asset impairments | $ 0 | $ 0 | $ 7 | $ 0 |
Gain on the sale of a manufacturing facility | $ 0 | $ 0 | $ 0 | $ 50 |
Other Financial Data - Other In
Other Financial Data - Other Income (Expense) (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jul. 03, 2021 | Jun. 27, 2020 | Jul. 03, 2021 | Jun. 27, 2020 | |
Interest income (expense), net: | ||||
Interest expense | $ (46) | $ (60) | $ (102) | $ (114) |
Interest income | 2 | 2 | 4 | 5 |
Interest income (expense), net | (44) | (58) | (98) | (109) |
Other, net: | ||||
Net periodic pension and postretirement benefit (Note 8) | 31 | 19 | 60 | 39 |
Loss from the extinguishment of long-term debt (Note 5) | (18) | 0 | (18) | 0 |
Foreign currency gain (loss) | (6) | (21) | 8 | (3) |
Gain (loss) on derivative instruments | (1) | 12 | (9) | (4) |
Gains on equity method investments | 2 | 0 | 3 | 0 |
Fair value adjustments to equity investments | 8 | 4 | 13 | 5 |
Other | (2) | 2 | 3 | (3) |
Total other income (expense) | $ 14 | $ 16 | $ 60 | $ 34 |
Other Financial Data - Earnings
Other Financial Data - Earnings Per Common Share (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jul. 03, 2021 | Jun. 27, 2020 | Jul. 03, 2021 | Jun. 27, 2020 | |
Basic earnings (loss) per common share: | ||||
Earnings | $ 293 | $ 135 | $ 537 | $ 332 |
Weighted average common shares outstanding (in shares) | 169.6 | 170 | 169.4 | 170.3 |
Basic earnings per share amount (in USD per share) | $ 1.73 | $ 0.79 | $ 3.17 | $ 1.95 |
Diluted earnings per common share: | ||||
Earnings | $ 293 | $ 135 | $ 537 | $ 332 |
Weighted average common shares outstanding (in shares) | 169.6 | 170 | 169.4 | 170.3 |
Add effect of dilutive securities: | ||||
Share-based awards (in shares) | 3.5 | 3.6 | 3.7 | 4.5 |
Diluted weighted average common shares outstanding (in shares) | 173.1 | 173.6 | 173.1 | 174.8 |
Per share amount (in USD per share) | $ 1.69 | $ 0.78 | $ 3.10 | $ 1.90 |
1.75% senior convertible notes | ||||
Add effect of dilutive securities: | ||||
Senior convertible notes (in shares) | 0 | 0 | 0 | 0 |
Other Financial Data - Earnin_2
Other Financial Data - Earnings Per Common Share - Additional Information (Details) $ / shares in Units, shares in Millions, $ in Billions | 3 Months Ended | 6 Months Ended | ||
Jul. 03, 2021USD ($)$ / sharesshares | Jun. 27, 2020shares | Jul. 03, 2021USD ($)$ / sharesshares | Jun. 27, 2020shares | |
Convertible Notes | 1.75% senior convertible notes | ||||
Debt Instrument [Line Items] | ||||
Debt instrument face amount | $ | $ 1 | $ 1 | ||
Interest rate | 1.75% | 1.75% | 1.75% | 1.75% |
Conversion rate | 0.0049140 | |||
Conversion price (in USD per share) | $ / shares | $ 203.50 | $ 203.50 | ||
Stock Options | ||||
Debt Instrument [Line Items] | ||||
Securities excluded from computation of dilutive shares due to antidilutive nature (in shares) | 0.4 | 0.6 | 0.4 | 0.4 |
Performance Options | ||||
Debt Instrument [Line Items] | ||||
Securities excluded from computation of dilutive shares due to antidilutive nature (in shares) | 0.2 | 0.2 | 0.1 | 0.1 |
Other Financial Data - Accounts
Other Financial Data - Accounts Receivable, Net (Details) - USD ($) $ in Millions | Jul. 03, 2021 | Dec. 31, 2020 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Accounts receivable | $ 1,244 | $ 1,465 |
Less allowance for credit losses | (75) | (75) |
Accounts receivable, net | $ 1,169 | $ 1,390 |
Other Financial Data - Inventor
Other Financial Data - Inventories, Net (Details) - USD ($) $ in Millions | Jul. 03, 2021 | Dec. 31, 2020 |
Inventory, Net [Abstract] | ||
Finished goods | $ 261 | $ 271 |
Work-in-process and production materials | 429 | 360 |
Inventories, gross | 690 | 631 |
Less inventory reserves | (131) | (123) |
Inventories, net | $ 559 | $ 508 |
Other Financial Data - Other Cu
Other Financial Data - Other Current Assets (Details) - USD ($) $ in Millions | Jul. 03, 2021 | Dec. 31, 2020 |
Other Current Assets [Abstract] | ||
Current contract cost assets (Note 2) | $ 30 | $ 23 |
Tax-related deposits | 44 | 52 |
Other | 180 | 167 |
Other current assets | $ 254 | $ 242 |
Other Financial Data - Property
Other Financial Data - Property, Plant and Equipment, Net (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |||
Jul. 03, 2021 | Jun. 27, 2020 | Jul. 03, 2021 | Jun. 27, 2020 | Dec. 31, 2020 | |
Property, Plant and Equipment, Net [Abstract] | |||||
Land | $ 4 | $ 4 | $ 6 | ||
Leasehold improvements | 473 | 473 | 439 | ||
Machinery and equipment | 2,378 | 2,378 | 2,276 | ||
Property, plant and equipment, gross | 2,855 | 2,855 | 2,721 | ||
Less accumulated depreciation | (1,827) | (1,827) | (1,699) | ||
Property, plant and equipment, net | 1,028 | 1,028 | $ 1,022 | ||
Depreciation expense | $ 52 | $ 47 | $ 104 | $ 93 |
Other Financial Data - Investme
Other Financial Data - Investments (Details) - USD ($) $ in Millions | Jul. 03, 2021 | Dec. 31, 2020 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Equity securities investment | $ 30 | $ 19 |
Strategic investments, at cost | 54 | 46 |
Company-owned life insurance policies | 79 | 77 |
Equity method investments | 18 | 16 |
Long-term investments | $ 181 | $ 158 |
Other Financial Data - Invest_2
Other Financial Data - Investments, Additional Information (Details) - USD ($) $ in Millions | Jul. 16, 2021 | Jul. 03, 2021 | Dec. 31, 2020 |
Debt and Equity Securities, FV-NI [Line Items] | |||
Equity securities investment | $ 30 | $ 19 | |
New Hold Investment Corp | Subsequent Event | |||
Debt and Equity Securities, FV-NI [Line Items] | |||
Equity securities investment | $ 50 |
Other Financial Data - Other As
Other Financial Data - Other Assets (Details) - USD ($) $ in Millions | Jul. 03, 2021 | Dec. 31, 2020 |
Other Assets [Abstract] | ||
Defined benefit plan assets | $ 332 | $ 283 |
Non-current contract cost assets (Note 2) | 110 | 105 |
Other | 67 | 94 |
Other assets, total | $ 509 | $ 482 |
Other Financial Data - Accrued
Other Financial Data - Accrued Liabilities (Details) - USD ($) $ in Millions | Jul. 03, 2021 | Dec. 31, 2020 |
Accrued Liabilities [Abstract] | ||
Compensation | $ 235 | $ 291 |
Tax liabilities | 81 | 147 |
Dividend payable | 120 | 120 |
Trade liabilities | 157 | 164 |
Operating lease liabilities (Note 3) | 129 | 126 |
Other | 490 | 463 |
Accrued liabilities | $ 1,212 | $ 1,311 |
Other Financial Data - Other Li
Other Financial Data - Other Liabilities (Details) - USD ($) $ in Millions | Jul. 03, 2021 | Dec. 31, 2020 |
Other Liabilities [Abstract] | ||
Defined benefit plans | $ 1,504 | $ 1,578 |
Non-current contract liabilities (Note 2) | 296 | 283 |
Deferred income taxes | 178 | 180 |
Other | 287 | 322 |
Other liabilities | $ 2,265 | $ 2,363 |
Other Financial Data - Stockhol
Other Financial Data - Stockholders' Equity (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 1 Months Ended | 3 Months Ended | 6 Months Ended | ||
Aug. 05, 2021 | Jul. 03, 2021 | Jun. 27, 2020 | Jul. 03, 2021 | Jun. 27, 2020 | |
Equity, Class of Treasury Stock [Line Items] | |||||
Payments for repurchased shares | $ 102 | $ 272 | $ 336 | ||
Number of shares repurchased (in shares) | 0.5 | 1.5 | |||
Repurchase of common shares, average cost (in USD per share) | $ 206.85 | $ 186.08 | |||
Increase to authorized share repurchase amount | $ 2,000 | ||||
Amount available for future share repurchase | 2,400 | $ 2,400 | |||
Cash dividends paid | $ 121 | $ 109 | $ 242 | $ 218 | |
Subsequent Event | |||||
Equity, Class of Treasury Stock [Line Items] | |||||
Cash dividends paid | $ 120 |
Other Financial Data - Accumula
Other Financial Data - Accumulated Other Comprehensive Loss (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||||
Jul. 03, 2021 | Apr. 03, 2021 | Jun. 27, 2020 | Mar. 28, 2020 | Jul. 03, 2021 | Jun. 27, 2020 | |
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ||||||
Balance at beginning of period | $ (541) | $ (541) | ||||
Other comprehensive income, net of tax | $ 22 | $ 91 | 58 | $ (35) | ||
Balance at end of period | (344) | (344) | ||||
Accumulated Other Comprehensive Income (Loss) | ||||||
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ||||||
Balance at beginning of period | (2,410) | (2,446) | (2,566) | $ (2,440) | (2,446) | (2,440) |
Other comprehensive income, net of tax | 22 | 36 | 91 | (126) | ||
Balance at end of period | (2,388) | (2,410) | (2,475) | (2,566) | (2,388) | (2,475) |
Foreign Currency Translation Adjustments | ||||||
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ||||||
Balance at beginning of period | (341) | (360) | (548) | (410) | (360) | (410) |
Other comprehensive income (loss) before reclassification adjustment | 6 | 75 | 23 | (61) | ||
Tax benefit | 0 | 3 | 2 | 1 | ||
Other comprehensive income, net of tax | 6 | 78 | 25 | (60) | ||
Balance at end of period | (335) | (341) | (470) | (548) | (335) | (470) |
Defined Benefit Plans | ||||||
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ||||||
Balance at beginning of period | (2,069) | (2,086) | (2,018) | (2,030) | (2,086) | (2,030) |
Other comprehensive income, net of tax | 16 | 13 | 33 | 25 | ||
Tax benefit | (3) | (2) | (6) | (5) | ||
Balance at end of period | (2,053) | $ (2,069) | (2,005) | $ (2,018) | (2,053) | (2,005) |
Reclassification adjustment - Actuarial net losses into Other income (Note 8) | ||||||
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ||||||
Reclassification adjustment before tax | 21 | 19 | 43 | 38 | ||
Reclassification adjustment - Prior service benefits into Other expense (Note 8) | ||||||
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ||||||
Reclassification adjustment before tax | $ (2) | $ (4) | $ (4) | $ (8) |
Debt and Credit Facilities Sche
Debt and Credit Facilities Schedule of Debt (Details) - USD ($) $ in Millions | Jul. 03, 2021 | May 24, 2021 | Dec. 31, 2020 | Jun. 27, 2020 |
Debt Instrument [Line Items] | ||||
Long-term debt, gross | $ 5,697 | $ 5,177 | ||
Adjustments for unamortized gains on interest rate swap terminations | (2) | (2) | ||
Less: current portion | (9) | (12) | ||
Long-term debt | $ 5,686 | 5,163 | ||
Senior Notes | 3.5% senior notes due 2023 | ||||
Debt Instrument [Line Items] | ||||
Interest rate | 3.50% | |||
Long-term debt, gross | $ 0 | 323 | ||
Senior Notes | 4.0% senior notes due 2024 | ||||
Debt Instrument [Line Items] | ||||
Interest rate | 4.00% | |||
Long-term debt, gross | $ 584 | 583 | ||
Senior Notes | 6.5% debentures due 2025 | ||||
Debt Instrument [Line Items] | ||||
Interest rate | 6.50% | |||
Senior Notes | 7.5% debentures due 2025 | ||||
Debt Instrument [Line Items] | ||||
Interest rate | 7.50% | |||
Senior Notes | 4.6% senior notes due 2028 | ||||
Debt Instrument [Line Items] | ||||
Interest rate | 4.60% | |||
Long-term debt, gross | $ 693 | 692 | ||
Senior Notes | 6.5% debentures due 2028 | ||||
Debt Instrument [Line Items] | ||||
Interest rate | 6.50% | |||
Senior Notes | 4.6% senior notes due 2029 | ||||
Debt Instrument [Line Items] | ||||
Interest rate | 4.60% | |||
Long-term debt, gross | $ 803 | 803 | ||
Senior Notes | 2.3% senior notes due 2030 | ||||
Debt Instrument [Line Items] | ||||
Interest rate | 2.30% | |||
Long-term debt, gross | $ 892 | 892 | ||
Senior Notes | 2.75% senior notes due 2031 | ||||
Debt Instrument [Line Items] | ||||
Interest rate | 2.75% | 2.75% | ||
Long-term debt, gross | $ 844 | 0 | ||
Senior Notes | 6.625% senior notes due 2037 | ||||
Debt Instrument [Line Items] | ||||
Interest rate | 6.625% | |||
Long-term debt, gross | $ 37 | 37 | ||
Senior Notes | 5.5% senior notes due 2044 | ||||
Debt Instrument [Line Items] | ||||
Interest rate | 5.50% | |||
Long-term debt, gross | $ 396 | 396 | ||
Senior Notes | 5.22% debentures due 2097 | ||||
Debt Instrument [Line Items] | ||||
Interest rate | 5.22% | |||
Convertible Notes | 1.75% senior convertible notes due 2024 | ||||
Debt Instrument [Line Items] | ||||
Interest rate | 1.75% | 1.75% | ||
Long-term debt, gross | $ 999 | 995 | ||
Unsecured Debt | 6.5% debentures due 2025 | ||||
Debt Instrument [Line Items] | ||||
Long-term debt, gross | 70 | 70 | ||
Unsecured Debt | 7.5% debentures due 2025 | ||||
Debt Instrument [Line Items] | ||||
Long-term debt, gross | 252 | 252 | ||
Unsecured Debt | 6.5% debentures due 2028 | ||||
Debt Instrument [Line Items] | ||||
Long-term debt, gross | 24 | 24 | ||
Unsecured Debt | 5.22% debentures due 2097 | ||||
Debt Instrument [Line Items] | ||||
Long-term debt, gross | 92 | 92 | ||
Other long-term debt | ||||
Debt Instrument [Line Items] | ||||
Long-term debt, gross | $ 11 | $ 18 |
Debt and Credit Facilities (Det
Debt and Credit Facilities (Details) - USD ($) $ in Millions | May 24, 2021 | Jul. 03, 2021 | Mar. 24, 2021 | Dec. 31, 2020 |
Debt Instrument [Line Items] | ||||
Debt instrument, repurchased principal amount | $ 324 | |||
Debt instrument, repurchase amount | 341 | |||
Gain (loss) on repurchase of debt instrument | (18) | |||
Long term debt | $ 5,697 | $ 5,177 | ||
Debt Instrument, Accrued Interest | 3 | |||
Debt instrument net of issuance costs | 844 | |||
Commercial Paper | ||||
Debt Instrument [Line Items] | ||||
Line of credit facility borrowing capacity | 2,200 | |||
Long term debt | $ 0 | |||
Senior Notes | 2.75% senior notes due 2031 | ||||
Debt Instrument [Line Items] | ||||
Debt instrument face amount | $ 850 | |||
Interest rate | 2.75% | 2.75% | ||
Long term debt | $ 844 | $ 0 | ||
Line of Credit | Revolving Credit Facility | 2021 Motorola Solutions Credit Agreement | ||||
Debt Instrument [Line Items] | ||||
Line of credit facility borrowing capacity | $ 2,250 | |||
Line of Credit | Letter of Credit | 2021 Motorola Solutions Credit Agreement | ||||
Debt Instrument [Line Items] | ||||
Line of credit facility borrowing capacity | $ 450 |
Risk Management - Foreign Curre
Risk Management - Foreign Currency Risk (Details) $ in Millions | Jul. 03, 2021USD ($)position | Dec. 31, 2020USD ($)position |
Derivative [Line Items] | ||
Number of net notional positions to buy or sell foreign currency disclosed (in number of positions) | position | 5 | 5 |
Foreign Exchange Contract | ||
Derivative [Line Items] | ||
Notional amounts of outstanding foreign exchange contracts | $ 1,200 | $ 1,200 |
Foreign Exchange Contract | Euro | Long | ||
Derivative [Line Items] | ||
Notional amounts of outstanding foreign exchange contracts | 173 | 177 |
Foreign Exchange Contract | Canadian dollar | Long | ||
Derivative [Line Items] | ||
Notional amounts of outstanding foreign exchange contracts | 54 | 61 |
Foreign Exchange Contract | British pound | Long | ||
Derivative [Line Items] | ||
Notional amounts of outstanding foreign exchange contracts | 48 | 86 |
Foreign Exchange Contract | Chinese renminbi | Short | ||
Derivative [Line Items] | ||
Notional amounts of outstanding foreign exchange contracts | 99 | 90 |
Foreign Exchange Contract | Australian dollar | Short | ||
Derivative [Line Items] | ||
Notional amounts of outstanding foreign exchange contracts | $ 89 | $ 88 |
Risk Management - Counterparty
Risk Management - Counterparty Risk (Details) $ in Millions | Jul. 03, 2021USD ($) |
Credit Concentration Risk | |
Derivative [Line Items] | |
Aggregate net credit risk | $ 5 |
Risk Management - Summary of Fa
Risk Management - Summary of Fair Values and Location in Condensed Consolidated Balance Sheet (Details) - USD ($) $ in Millions | Jul. 03, 2021 | Dec. 31, 2020 |
Other Current Assets | ||
Fair Value | ||
Other Current Assets | $ 5 | $ 14 |
Accrued Liabilities | ||
Fair Value | ||
Accrued Liabilities | 11 | 8 |
Designated as Hedging Instrument | Foreign exchange contracts | Other Current Assets | ||
Fair Value | ||
Other Current Assets | 4 | 0 |
Designated as Hedging Instrument | Foreign exchange contracts | Accrued Liabilities | ||
Fair Value | ||
Accrued Liabilities | 1 | 5 |
Not Designated As Hedging Instruments | Foreign exchange contracts | Other Current Assets | ||
Fair Value | ||
Other Current Assets | 1 | 14 |
Not Designated As Hedging Instruments | Foreign exchange contracts | Accrued Liabilities | ||
Fair Value | ||
Accrued Liabilities | $ 10 | $ 3 |
Risk Management - Summary of De
Risk Management - Summary of Derivative Instruments and the Effect on the Condensed Consolidated Statements of Operations (Details) - Foreign exchange contracts - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jul. 03, 2021 | Jun. 27, 2020 | Jul. 03, 2021 | Jun. 27, 2020 | |
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Effective portion | $ (1) | $ (11) | $ 3 | $ 8 |
Forward points recognized | 0 | 1 | 1 | 2 |
Not Designated As Hedging Instruments | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Undesignated derivatives recognized | $ (1) | $ 12 | $ (9) | $ (4) |
Risk Management - Net Investmen
Risk Management - Net Investment Hedges (Details) € in Millions, £ in Millions, $ in Millions | 3 Months Ended | 6 Months Ended | ||||
Jun. 27, 2020USD ($) | Jul. 03, 2021USD ($) | Jun. 27, 2020USD ($) | Jul. 03, 2021EUR (€) | Jul. 03, 2021GBP (£) | Dec. 31, 2020USD ($) | |
Minimum | Net Investment Hedging | ||||||
Derivative [Line Items] | ||||||
Term of contract | 12 months | |||||
Maximum | Net Investment Hedging | ||||||
Derivative [Line Items] | ||||||
Term of contract | 15 months | |||||
Foreign Exchange Contract | ||||||
Derivative [Line Items] | ||||||
Notional amounts of outstanding foreign exchange contracts | $ 1,200 | $ 1,200 | ||||
Foreign Exchange Contract | Net Investment Hedging | Interest Expense | ||||||
Derivative [Line Items] | ||||||
Amortization of income from the excluded components through interest expense | $ 1 | $ 1 | $ 2 | |||
Foreign Exchange Contract | Designated as Hedging Instrument | Net Investment Hedging | ||||||
Derivative [Line Items] | ||||||
Notional amounts of outstanding foreign exchange contracts | € 100 | £ 125 |
Income Taxes - Schedule of Inco
Income Taxes - Schedule of Income Taxes (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jul. 03, 2021 | Jun. 27, 2020 | Jul. 03, 2021 | Jun. 27, 2020 | |
Income Tax Disclosure [Abstract] | ||||
Net earnings before income taxes | $ 340 | $ 176 | $ 630 | $ 401 |
Income tax expense | $ 46 | $ 40 | $ 90 | $ 67 |
Effective tax rate | 14.00% | 23.00% | 14.00% | 17.00% |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jul. 03, 2021 | Jun. 27, 2020 | Jul. 03, 2021 | Jun. 27, 2020 | |
Income Tax Disclosure [Abstract] | ||||
Income tax expense | $ 46 | $ 40 | $ 90 | $ 67 |
Effective tax rate | 14.00% | 23.00% | 14.00% | 17.00% |
Valuation allowance tax benefit | $ 33 | $ 33 | $ 33 | $ 33 |
Retirement and Other Employee_3
Retirement and Other Employee Benefits - Pension and Postretirement Health Care Benefits (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jul. 03, 2021 | Jun. 27, 2020 | Jul. 03, 2021 | Jun. 27, 2020 | |
Postretirement Health Care Benefits Plan | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Service cost | $ 0 | $ 0 | $ 0 | $ 0 |
Interest cost | 1 | 1 | 1 | 1 |
Expected return on plan assets | (2) | (3) | (5) | (5) |
Amortization of: | ||||
Unrecognized net loss | 0 | 1 | 1 | 2 |
Unrecognized prior service benefit | (2) | (4) | (3) | (7) |
Net periodic pension benefits | (3) | (5) | (6) | (9) |
U.S. | Pension Benefit Plan | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Service cost | 0 | 0 | 0 | 0 |
Interest cost | 29 | 36 | 58 | 72 |
Expected return on plan assets | (59) | (56) | (118) | (112) |
Amortization of: | ||||
Unrecognized net loss | 17 | 14 | 34 | 29 |
Unrecognized prior service benefit | 0 | 0 | 0 | 0 |
Net periodic pension benefits | (13) | (6) | (26) | (11) |
Non-U.S. | Pension Benefit Plan | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Service cost | 0 | 1 | 1 | 1 |
Interest cost | 5 | 7 | 10 | 14 |
Expected return on plan assets | (25) | (22) | (50) | (42) |
Amortization of: | ||||
Unrecognized net loss | 4 | 4 | 8 | 7 |
Unrecognized prior service benefit | 0 | 0 | (1) | (1) |
Net periodic pension benefits | $ (16) | $ (10) | $ (32) | $ (21) |
Share-Based Compensation Plan_2
Share-Based Compensation Plans - Schedule of Compensation Expense (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jul. 03, 2021 | Jun. 27, 2020 | Jul. 03, 2021 | Jun. 27, 2020 | |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Share-based compensation expense included in Operating earnings | $ 31 | $ 31 | $ 60 | $ 69 |
Tax benefit | (2) | (5) | (8) | (11) |
Share-based compensation expense, net of tax | $ 29 | $ 26 | $ 52 | $ 58 |
Decrease in basic earnings per share (in USD per share) | $ (0.17) | $ (0.15) | $ (0.31) | $ (0.34) |
Decrease in diluted earnings per share (in USD per share) | $ (0.17) | $ (0.15) | $ (0.30) | $ (0.33) |
Costs of sales | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Share-based compensation expense included in Operating earnings | $ 4 | $ 4 | $ 8 | $ 9 |
Selling, general and administrative expenses | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Share-based compensation expense included in Operating earnings | 19 | 18 | 36 | 39 |
Research and development expenditures | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Share-based compensation expense included in Operating earnings | $ 8 | $ 9 | $ 16 | $ 21 |
Share-Based Compensation Plan_3
Share-Based Compensation Plans - Narrative (Details) shares in Millions, $ in Millions | 6 Months Ended |
Jul. 03, 2021USD ($)shares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Vesting period | 3 years |
Restricted Stock Units (RSUs) | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Units granted in period (in shares) | shares | 0.4 |
Aggregate grant date fair value | $ | $ 64 |
Performance Stock Units (PSUs) | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Units granted in period (in shares) | shares | 0.1 |
Aggregate grant date fair value | $ | $ 15 |
Market Stock Units (MSUs) | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Units granted in period (in shares) | shares | 0.1 |
Aggregate grant date fair value | $ | $ 10 |
Stock Options | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Options granted in period (in shares) | shares | 0.2 |
Aggregate grant date fair value | $ | $ 8 |
Performance Options | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Options granted in period (in shares) | shares | 0.2 |
Aggregate grant date fair value | $ | $ 10 |
Fair Value Measurements - Asset
Fair Value Measurements - Assets and Liabilities (Details) - Recurring basis - USD ($) $ in Millions | Jul. 03, 2021 | Dec. 31, 2020 |
Estimate of Fair Value, Fair Value Disclosure | Common stock | ||
Assets: | ||
Common stock | $ 30 | $ 19 |
Estimate of Fair Value, Fair Value Disclosure | Foreign exchange contracts | ||
Assets: | ||
Foreign exchange derivative contracts | 5 | 14 |
Liabilities: | ||
Foreign exchange derivative contracts | 11 | 8 |
Level 1 | Common stock | ||
Assets: | ||
Common stock | 30 | 19 |
Level 1 | Foreign exchange contracts | ||
Assets: | ||
Foreign exchange derivative contracts | 0 | 0 |
Liabilities: | ||
Foreign exchange derivative contracts | 0 | 0 |
Level 2 | Common stock | ||
Assets: | ||
Common stock | 0 | 0 |
Level 2 | Foreign exchange contracts | ||
Assets: | ||
Foreign exchange derivative contracts | 5 | 14 |
Liabilities: | ||
Foreign exchange derivative contracts | $ 11 | $ 8 |
Fair Value Measurements - Narra
Fair Value Measurements - Narrative (Details) - USD ($) $ in Millions | Jul. 03, 2021 | Dec. 31, 2020 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investments in money market mutual funds classified as cash and cash equivalents | $ 811 | $ 448 |
Level 2 | Estimate of Fair Value, Fair Value Disclosure | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value of long term debt | $ 6,300 | $ 5,800 |
Sales of Receivables - Sales Re
Sales of Receivables - Sales Receivables (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jul. 03, 2021 | Jun. 27, 2020 | Jul. 03, 2021 | Jun. 27, 2020 | |
Receivables [Abstract] | ||||
Contract-specific discounting facility | $ 36 | $ 54 | $ 107 | $ 98 |
Accounts receivable sales proceeds | 8 | 34 | 8 | 58 |
Long-term receivables sales proceeds | 30 | 29 | 84 | 70 |
Total proceeds from receivable sales | $ 74 | $ 117 | $ 199 | $ 226 |
Sales of Receivables - Addition
Sales of Receivables - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |||
Jul. 03, 2021 | Jun. 27, 2020 | Jul. 03, 2021 | Jun. 27, 2020 | Dec. 31, 2020 | |
Receivables [Abstract] | |||||
Servicing obligations for long-term receivables | $ 931 | $ 931 | $ 983 | ||
Long-term financing | 99 | 99 | $ 78 | ||
Contract-specific discounting facility | $ 36 | $ 54 | $ 107 | $ 98 |
Commitment and Contingencies (D
Commitment and Contingencies (Details) - USD ($) $ in Millions | Jan. 11, 2021 | Feb. 14, 2020 |
Commitments and Contingencies Disclosure [Abstract] | ||
Compensatory damages | $ 345.8 | |
Punitive damages | 418.8 | |
Total damages awarded | $ 543.7 | $ 764.6 |
Segment Information - Operating
Segment Information - Operating Business Segment (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jul. 03, 2021 | Jun. 27, 2020 | Jul. 03, 2021 | Jun. 27, 2020 | |
Segment Reporting Information [Line Items] | ||||
Net sales | $ 1,971 | $ 1,618 | $ 3,744 | $ 3,273 |
Operating Earnings by Segment | ||||
Operating earnings | 370 | 218 | 668 | 476 |
Total other expense | (30) | (42) | (38) | (75) |
Net earnings before income taxes | 340 | 176 | 630 | 401 |
Products and Systems Integration | ||||
Segment Reporting Information [Line Items] | ||||
Net sales | 1,198 | 968 | 2,213 | 1,961 |
Operating Earnings by Segment | ||||
Operating earnings | 139 | 49 | 216 | 141 |
Software and Services | ||||
Segment Reporting Information [Line Items] | ||||
Net sales | 773 | 650 | 1,531 | 1,312 |
Operating Earnings by Segment | ||||
Operating earnings | $ 231 | $ 169 | $ 452 | $ 335 |
Reorganization of Business - Na
Reorganization of Business - Narrative (Details) $ in Millions | 3 Months Ended | 6 Months Ended | |||
Jul. 03, 2021USD ($)employee | Jun. 27, 2020USD ($) | Jul. 03, 2021USD ($)employee | Jun. 27, 2020USD ($) | Dec. 31, 2020USD ($) | |
Restructuring Cost and Reserve [Line Items] | |||||
Reorganization of business charges | $ 9 | $ 41 | $ 25 | $ 59 | |
Reversal of accruals | 3 | 5 | $ 5 | 9 | |
Restructuring charges in the period for total employee severance (in number of employees) | employee | 400 | ||||
Employee Separation Costs | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring charges | 12 | 46 | $ 30 | 68 | |
Reversal of accruals | 5 | ||||
Restructuring reserve | $ 48 | 48 | $ 79 | ||
Payments for Restructuring | $ (56) | ||||
Number of employees expected to be paid (in number of employees) | employee | 1,000 | 1,000 | |||
Other charges | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Reorganization of business charges | $ 6 | 26 | $ 20 | 38 | |
Costs of sales | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Reorganization of business charges | $ 3 | $ 15 | $ 5 | $ 21 |
Reorganization of Business - Ne
Reorganization of Business - Net Charges Incurred by Business Segment (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jul. 03, 2021 | Jun. 27, 2020 | Jul. 03, 2021 | Jun. 27, 2020 | |
Restructuring Cost and Reserve [Line Items] | ||||
Reorganization of business charges | $ 9 | $ 41 | $ 25 | $ 59 |
Products and Systems Integration | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Reorganization of business charges | 7 | 33 | 19 | 47 |
Software and Services | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Reorganization of business charges | $ 2 | $ 8 | $ 6 | $ 12 |
Reorganization of Business - Re
Reorganization of Business - Reorganization of Businesses Accruals (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jul. 03, 2021 | Jun. 27, 2020 | Jul. 03, 2021 | Jun. 27, 2020 | |
Restructuring Reserve [Roll Forward] | ||||
Adjustments | $ (3) | $ (5) | $ (5) | $ (9) |
Employee Separation Costs | ||||
Restructuring Reserve [Roll Forward] | ||||
January 1, 2021 | 79 | |||
Additional Charges | 12 | $ 46 | 30 | $ 68 |
Adjustments | (5) | |||
Amount Used | (56) | |||
July 3, 2021 | $ 48 | $ 48 |
Intangible Assets and Goodwil_2
Intangible Assets and Goodwill - Recent Acquisition (Details) - USD ($) $ in Millions | Jul. 15, 2021 | Aug. 28, 2020 | Jul. 31, 2020 | Jun. 16, 2020 | Apr. 30, 2020 | Mar. 03, 2020 | Jul. 03, 2021 | Dec. 31, 2020 |
Business Acquisition [Line Items] | ||||||||
Goodwill | $ 2,219 | $ 2,219 | ||||||
Openpath | Subsequent Event | ||||||||
Business Acquisition [Line Items] | ||||||||
Cash paid for acquisition | $ 297 | |||||||
Share-based compensation acquired | $ 29 | |||||||
Share-based compensation withheld, average service period | 3 years | |||||||
Callyo | ||||||||
Business Acquisition [Line Items] | ||||||||
Cash paid for acquisition | $ 61 | |||||||
Share-based compensation acquired | $ 3 | |||||||
Share-based compensation withheld, average service period | 2 years | |||||||
Consideration transferred | $ 63 | |||||||
Goodwill | 38 | |||||||
Intangible assets acquired | 31 | |||||||
Net liabilities | 8 | |||||||
Pelco, Inc. | ||||||||
Business Acquisition [Line Items] | ||||||||
Cash paid for acquisition | $ 107 | |||||||
Consideration transferred | 110 | |||||||
Goodwill | 35 | |||||||
Intangible assets acquired | 30 | |||||||
Net assets acquired | 42 | |||||||
IndigoVision | ||||||||
Business Acquisition [Line Items] | ||||||||
Cash paid for acquisition | $ 35 | |||||||
Consideration transferred | 37 | |||||||
Goodwill | 18 | |||||||
Intangible assets acquired | 22 | |||||||
Net liabilities | 5 | |||||||
Cybersecurity Services Business | ||||||||
Business Acquisition [Line Items] | ||||||||
Cash paid for acquisition | $ 32 | $ 33 | ||||||
Share-based compensation acquired | $ 6 | |||||||
Share-based compensation withheld, average service period | 2 years | |||||||
Consideration transferred | $ 40 | |||||||
Goodwill | 23 | 28 | ||||||
Intangible assets acquired | 10 | 7 | ||||||
Net liabilities | 1 | $ 2 | ||||||
Customer Relationships | Callyo | ||||||||
Business Acquisition [Line Items] | ||||||||
Intangible assets acquired | $ 27 | |||||||
Useful life | 14 years | |||||||
Customer Relationships | Pelco, Inc. | ||||||||
Business Acquisition [Line Items] | ||||||||
Intangible assets acquired | $ 23 | |||||||
Useful life | 15 years | |||||||
Customer Relationships | IndigoVision | ||||||||
Business Acquisition [Line Items] | ||||||||
Intangible assets acquired | $ 22 | |||||||
Useful life | 11 years | |||||||
Customer Relationships | Cybersecurity Services Business | ||||||||
Business Acquisition [Line Items] | ||||||||
Intangible assets acquired | $ 8 | |||||||
Useful life | 12 years | 13 years | ||||||
Technology | Callyo | ||||||||
Business Acquisition [Line Items] | ||||||||
Intangible assets acquired | $ 4 | |||||||
Useful life | 7 years | |||||||
Technology | Pelco, Inc. | ||||||||
Business Acquisition [Line Items] | ||||||||
Intangible assets acquired | $ 4 | |||||||
Useful life | 2 years | |||||||
Technology | Cybersecurity Services Business | ||||||||
Business Acquisition [Line Items] | ||||||||
Intangible assets acquired | $ 2 | |||||||
Useful life | 3 years | |||||||
Trade Names | Pelco, Inc. | ||||||||
Business Acquisition [Line Items] | ||||||||
Intangible assets acquired | $ 3 | |||||||
Useful life | 5 years |
Intangible Assets and Goodwil_3
Intangible Assets and Goodwill - Intangible Assets (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |||
Jul. 03, 2021 | Jun. 27, 2020 | Jul. 03, 2021 | Jun. 27, 2020 | Dec. 31, 2020 | |
Finite-Lived Intangible Assets [Line Items] | |||||
Gross Carrying Amount | $ 2,201 | $ 2,201 | $ 2,181 | ||
Accumulated Amortization | 1,078 | 1,078 | 947 | ||
Intangible Assets And Goodwill | |||||
Amortization expense on intangibles | 58 | $ 51 | 116 | $ 104 | |
Finite-Lived Intangible Assets, Future Amortization Expense | |||||
2021 | 209 | 209 | |||
2022 | 206 | 206 | |||
2023 | 108 | 108 | |||
2024 | 83 | 83 | |||
2025 | 73 | 73 | |||
2026 | 69 | 69 | |||
Completed technology | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Gross Carrying Amount | 766 | 766 | 766 | ||
Accumulated Amortization | 245 | 245 | 210 | ||
Customer-related | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Gross Carrying Amount | 1,354 | 1,354 | 1,335 | ||
Accumulated Amortization | 777 | 777 | 685 | ||
Other intangibles | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Gross Carrying Amount | 81 | 81 | 80 | ||
Accumulated Amortization | $ 56 | $ 56 | $ 52 |
Intangible Assets and Goodwil_4
Intangible Assets and Goodwill - Amortized Intangible Assets, Excluding Goodwill, By Business Segment (Details) - USD ($) $ in Millions | Jul. 03, 2021 | Dec. 31, 2020 |
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 2,201 | $ 2,181 |
Accumulated Amortization | 1,078 | 947 |
Products and Systems Integration | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 694 | 692 |
Accumulated Amortization | 154 | 129 |
Software and Services | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 1,507 | 1,489 |
Accumulated Amortization | $ 924 | $ 818 |
Intangible Assets and Goodwil_5
Intangible Assets and Goodwill - Carrying Amount of Goodwill (Details) $ in Millions | 6 Months Ended |
Jul. 03, 2021USD ($) | |
Goodwill Activity | |
Goodwill, Beginning Balance | $ 2,219 |
Purchase accounting adjustments | (4) |
Foreign currency | 4 |
Balance as of July 3, 2021 | 2,219 |
Products and Systems Integration | |
Goodwill Activity | |
Goodwill, Beginning Balance | 1,019 |
Purchase accounting adjustments | (3) |
Foreign currency | 0 |
Balance as of July 3, 2021 | 1,016 |
Software and Services | |
Goodwill Activity | |
Goodwill, Beginning Balance | 1,200 |
Purchase accounting adjustments | (1) |
Foreign currency | 4 |
Balance as of July 3, 2021 | $ 1,203 |