AXON Q3 2024 Earnings

📈 Stock Spotlight: Axon Enterprise, Inc. (AXON)

Hey guys, welcome to this week’s stock analysis newsletter. Today, we’re diving into Axon Enterprise, Inc. (AXON)—the company behind TASERs, body-worn cameras, and groundbreaking public safety tech. 🚓

🔥 Q3 2024 Highlights

Axon had an impressive Q3, surpassing expectations with strong growth across its TASER and software segments. Let’s break it down:

• 📊 Revenue Growth: Up 32% YoY, driven by robust demand across products and customer verticals.

• 💵 Adjusted EBITDA Margin: 26.7%, reflecting disciplined growth.

• TASER Boom: Revenue soared 36% YoY, fueled by demand for the TASER 10.

• 🌐 Software Success: Software revenue jumped 47% YoY, with 75% gross margins—a growing stream of recurring income.

• International Expansion: Bookings climbed 40% YoY as Axon broadened its global footprint.

🚀 AI Era Plan: A Game-Changer

Axon is leaning heavily into AI to reshape public safety:

• Draft One AI Product: Subscription-based pricing starts at $65/month. Bundles offer significant savings for agencies.

• SaaS Focus: AI integration is driving ARR growth, enhancing Axon’s recurring revenue strategy.

• Ethical AI: With an Ethics Advisory Council, Axon ensures its AI tools are tested for safety and fairness.

🔧 Product Innovations

Axon is redefining public safety tech:

• TASER 10: Agencies are upgrading rapidly, with future innovations like clothing-penetration capabilities on the horizon.

• Body-Worn Cameras: Integrated wireless chips unlock real-time data use cases.

• Drones & Real-Time Crime Centers: Axon’s Fusus acquisition and partnerships like Skydio are enabling advanced, collaborative crime-fighting solutions.

🌍 Market Growth & Strategic Moves

• Federal & Corrections: Strong bookings from government and corrections sectors.

• Enterprise Opportunities: Retail security trials with Fortune 500 companies open a new growth avenue.

• Strategic Acquisitions: Dedrone and Sky Hero acquisitions boost Axon’s total addressable market (TAM) to $77B.

⚖️ Risks to Watch

While Axon’s outlook is promising, keep these in mind:

• Achieving ambitious booking goals for Q4 2024.

• Sustainability of TASER segment growth.

• Political and economic uncertainties.

💡 The Big Picture

Axon is on track to hit its $2 billion revenue target for 2025—one year early. Its innovative AI-driven strategy, customer-centric focus, and bold acquisitions position it as a leader in public safety modernization.

🎯 Key Quote:
"Our success is measured in years and lives saved." – Rick Smith, CEO

🤔 Investment Perspective

With a high valuation and long-term growth potential, I believe Axon remains a compelling long-term opportunity. In my opinion, they are firing on all cylinders and expanding into more verticals (acquisition of Fusus, Dedrone as well as implementation of Draft One). Despite the high valuations, this is still an opportunity to invest.

What are your thoughts on AXON’s future? Reply to this email and share your take!

Until next time,

Henry Dalsania, Founder, Profit Pulse
Your go-to guide for stock analysis and building generational wealth!