$AXON (-2,81%) Still a top performer. However, the market isn’t happy about the downward revision to the forecast. But it’s always amusing when the growth target is now “only” 30%.
✅ Pros
- Revenue up 28% YoY to $909 million
- Software & Services: 43% growth
- ARR +40% to $1.75 billion
- AI ARR exceeds $100 million for the first time
- Net Revenue Retention: 126%
- Future Contracted Bookings up 39% to $15.8 billion
- Operating Income Turned from a Loss to +$42 million
- EBITDA up 33% year-over-year
- Net income positive (USD 57 million)
- Software gross margin >80%
- AI bookings up 50% year-to-date
- New products (Records, AI, 911, Guardian, Gravity) are scaling rapidly
- New business segments now have a revenue run rate of nearly $500 million
- Q4 revenue guidance remains near $1 billion in quarterly revenue
- Full-year EBITDA margin guidance has even been raised slightly
❌ Cons
- Full-year guidance lowered from 32–34% growth to approximately 30%
- Three Dedrone federal contracts totaling approximately $130 million have been postponed
- Q3 revenue below analyst estimates
- Gross margin declining
- Hardware mix (Dedrone) weighs on profitability
- Higher storage costs are squeezing margins
- Q3 free cash flow negative (–$19 million)
- Annual free cash flow target lowered
- Inventory build-up ties up significant capital (~$225 million in 2026)
- Stock-based compensation is very high (USD 570–600 million for FY26)
- Net debt now stands at approximately $1.2 billion
- Valuation was extremely ambitious prior to the earnings release
