Motorola Solutions, Inc. (NYSE:MSI) Q3 2020 Earnings Conference Call - Final Transcript

Oct 29, 2020 • 05:00 pm ET

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Motorola Solutions, Inc. (NYSE:MSI) Q3 2020 Earnings Conference Call - Final Transcript

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Q & A
Operator
Operator

[Operator Instructions] Thank you. The first question today is from Sami Badri of Credit Suisse. Please go ahead.

Analyst
Sami Badri

Hi there, thank you and congrats on the solid results in 3Q. I first wanted to ask about the $120 million 911 contract that you guys signed that was the highest in the company's history, and maybe two pieces to this. How will that be recognized over time, is kind of like the first question? And then I know there's probably going to be similar deals like this in the future, probably not at the same magnitude, but maybe could you give us a little bit of an idea on how popular this type of specific large deal could potentially be in demand in the medium- to long-term?

Executive
Kelly S. Mark

Sure, hey, Sami, it's Kelly. So on the NGCS I think I would say three things about it. First off, look, we're really excited about that part of the business. It is the entry point for all 911 calls, and as I think I may have referenced on a prior call, what that effectively does is creates the EazzyNet multi-lane highway entry point to 911 centers, where they can now handle video, audio, pictures, text, versus the single-lane highway of voice that they could handle before. The second thing I'd say about this deal is when you think about it, this and other similar deals like that will get on NGCS. There's always an installation component that's upfront, and then there's a longer tale of as a service, where we'll run the system for our customers, and that's similar to what we have here in the multi-year contract.

The third thing I'd just remind you about -- around NGCS, is while we have some of our own software and componentry in it, we are also acting a systems integrator. So we are, in effect, reselling backhaul and other components as an offering for the entire solution, which is a bit different than what we do in our 911 call-taking software or our CAD software, where we are the entirety of the software solution. But we're excited about this. We think that NGCS and EazzyNet is -- I would call it, if you're looking at a nine inning baseball game, I think we're somewhere around maybe the second or the third inning, so we're early in the conversion of EazzyNet across the United States. So there's certainly other deals out there, and we'll just continue to fight for those and update you on those as they come.

Executive
Greg Brown

And Sami, this contract, $120 million plus, will be rev-recognized over a multi-year, long-term contract.

Analyst
Sami Badri

Got it. Thank you. And then Greg, just one question for you. We still have the $9 billion of revenue and $10 EVP, EPS guideposts laid out for 2021, and obviously COVID may have shifted this around a little bit, but I was hoping you'd give us a little bit of an update around this guidepost or this framework on how we should be