Motorola Solutions (MSI) stock plummeted 5.27% in after-hours trading on Thursday following the release of its first-quarter 2025 financial results and second-quarter guidance. While the company beat expectations for Q1, its outlook for Q2 fell short of analyst estimates, triggering a sell-off among investors.

The communications equipment maker reported Q1 adjusted earnings per share of $3.18, surpassing the IBES estimate of $3.01. Revenue for the quarter came in at $2,528 million, slightly above the expected $2,516 million. However, the company's Q2 guidance disappointed Wall Street, projecting adjusted EPS of $3.32 to $3.37 on revenue growth of 4%. This outlook fell below the FactSet analyst consensus of $3.47 per share on revenue of $2.76 billion.

Adding to investor concerns, Motorola Solutions anticipates increased costs on materials and components in 2025 due to tariffs, although it expects to substantially mitigate these impacts. The company maintained its prior full-year guidance of about 5.5% revenue growth, which some investors may view as conservative given the current economic environment. Despite these challenges, Motorola Solutions remains focused on navigating the uncertain landscape, with a Q1 EBIT margin of 23% and operating cash flow of $510 million demonstrating its operational efficiency.