Name: Motorola Solutions Inc. (NYSE:MSI) | Income Statement
Creator: Stock Analysis on Net

Income Statement

The income statement presents information on the financial results of a company business activities over a period of time. The income statement communicates how much revenue the company generated during a period and what cost it incurred in connection with generating that revenue.

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Motorola Solutions Inc., consolidated income statement

US$ in millions

12 months ended:	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Net sales from products	5,814)	5,368)	4,606)	4,087)	4,746)
Net sales from services	4,164)	3,744)	3,565)	3,327)	3,141)
Net sales	9,978)	9,112)	8,171)	7,414)	7,887)
Costs of products sales	(2,591)	(2,595)	(2,104)	(1,872)	(2,049)
Costs of services sales	(2,417)	(2,288)	(2,027)	(1,934)	(1,907)
Costs of sales	(5,008)	(4,883)	(4,131)	(3,806)	(3,956)
Gross margin	4,970)	4,229)	4,040)	3,608)	3,931)
Selling, general and administrative expenses	(1,561)	(1,450)	(1,353)	(1,293)	(1,403)
Research and development expenditures	(858)	(779)	(734)	(686)	(687)
Intangibles amortization	(177)	(257)	(236)	(215)	(208)
Reorganization of businesses	(22)	(18)	(24)	(57)	(40)
Legal Settlements	(4)	(23)	(3)	(9)	(3)
Fixed asset impairments	(3)	(12)	—)	(5)	—)
Gain on sale of property, plant, and equipment	—)	—)	—)	50)	—)
Environmental reserve expense	(15)	—)	—)	—)	—)
Exit of video manufacturing operations	(24)	—)	—)	—)	—)
Operating lease asset impairments	(6)	(24)	(10)	—)	(5)
Acquisition-related transaction fees	(7)	(23)	(15)	(9)	(3)
Gain on Hytera legal settlement	—)	15)	—)	—)	—)
Other	1)	3)	2)	(1)	(1)
Other charges	(257)	(339)	(286)	(246)	(260)
Operating earnings	2,294)	1,661)	1,667)	1,383)	1,581)
Interest expense	(249)	(240)	(215)	(233)	(237)
Interest income	33)	14)	7)	13)	17)
Interest expense, net	(216)	(226)	(208)	(220)	(220)
Gains (losses) on sales of investments and businesses, net	—)	3)	1)	(2)	5)
Net periodic pension and postretirement benefit	99)	123)	123)	81)	78)
Loss from the extinguishment of long-term debt	—)	(6)	(18)	(56)	(50)
Gains from the extinguishment of 2.00% senior convertible notes	—)	—)	—)	—)	4)
Investment impairments	(16)	(1)	—)	(4)	(18)
Foreign currency gain (loss)	(53)	37)	17)	(44)	(22)
Gain (loss) on derivative instruments	20)	(61)	(30)	25)	(8)
Gains (loss) on equity method investments	—)	(3)	5)	3)	3)
Fair value adjustments to equity investments	13)	(30)	(8)	6)	(3)
Gain on TETRA Ireland equity method investment	—)	21)	—)	—)	—)
U.S. pension settlement	—)	—)	—)	—)	(359)
Other	5)	(3)	3)	2)	10)
Other, net	68)	77)	92)	13)	(365)
Other expense	(148)	(146)	(115)	(209)	(580)
Net earnings before income taxes	2,146)	1,515)	1,552)	1,174)	1,001)
Income tax expense	(432)	(148)	(302)	(221)	(130)
Net earnings	1,714)	1,367)	1,250)	953)	871)
Earnings attributable to noncontrolling interests	(5)	(4)	(5)	(4)	(3)
Net earnings attributable to Motorola Solutions, Inc.	1,709)	1,363)	1,245)	949)	868)

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

Financial performance from 2019 to 2023 is characterized by consistent revenue growth and a significant expansion in net profitability. Total net sales increased from 7,887 million US dollars in 2019 to 9,978 million US dollars in 2023, representing a steady upward trajectory in market demand and scaling operations.

Revenue Stream Dynamics: Net sales from products exhibited volatility, experiencing a decline in 2020 to 4,087 million US dollars before recovering and reaching a peak of 5,814 million US dollars by 2023. In contrast, net sales from services demonstrated uninterrupted annual growth, rising from 3,141 million US dollars in 2019 to 4,164 million US dollars in 2023, indicating a successful strategic shift toward recurring service-based revenue.
Gross Profitability and Cost Management: Gross margin remained resilient, increasing from 3,931 million US dollars in 2019 to 4,970 million US dollars in 2023. The stability of the gross margin percentage relative to revenue suggests effective pricing strategies and the ability to manage the rising costs of sales for both products and services.
Operating Expenditure Trends: Research and development expenditures showed a consistent increase, growing from 687 million US dollars in 2019 to 858 million US dollars in 2023, reflecting a sustained commitment to innovation. Selling, general, and administrative expenses remained relatively controlled, increasing moderately from 1,403 million US dollars to 1,561 million US dollars over the same period, which highlights operational efficiency as the company scaled.
Operating and Net Earnings Growth: Operating earnings grew from 1,581 million US dollars in 2019 to 2,294 million US dollars in 2023, with a particularly sharp increase observed between 2022 and 2023. This operational growth translated effectively to the bottom line, with net earnings attributable to Motorola Solutions, Inc. nearly doubling from 868 million US dollars in 2019 to 1,709 million US dollars in 2023.
Financial and Non-Operating Impacts: Net interest expense remained stable, fluctuating narrowly between 208 million and 226 million US dollars annually. Significant non-recurring items were noted, including a 359 million US dollar U.S. pension settlement in 2019 and various acquisition-related transaction fees and impairments throughout the period. Income tax expense increased significantly in 2023 to 432 million US dollars, correlating with the higher taxable income generated by increased net earnings.

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