Axon Enterprises (NASDAQ: AXON) saw its stock climb by 25% last week, boosted by a successful quarter marked by surging sales, excitement around AI integrations, and an upward revision of its full-year guidance. Axon, a leader in public safety equipment, primarily sells its renowned “Taser” products, body cameras, and software solutions designed for data analysis to law enforcement agencies across the country.
Last Tuesday, Axon significantly outperformed expectations, reporting earnings per share of $1.20, well above the consensus estimate of $1.06. Revenue also exceeded projections, with the company reporting $504.1 million, surpassing the anticipated $477 million. Additionally, Axon’s cloud service business experienced a remarkable 46.8% growth, driven by increased adoption from both new and existing customers.
Axon is also focusing on expanding and enhancing its software offerings through AI applications. These include advanced features such as license plate recognition, audio-to-text transcription for body camera footage, and a service called Draft One, which uses these transcriptions to generate a rough draft of police reports. Sales of Axon’s AI-enhanced products surged by over 70% in the second quarter.
Looking ahead, Axon has raised its revenue guidance for 2024, increasing the estimate range from $1.94-$1.99 billion to $2.00-$2.05 billion. The company’s stock has been on an impressive run, gaining nearly 43% year-to-date and over 530% over the past five years.
Currently, Axon trades at around 77 times forward earnings. Most analysts have given Axon a buy rating, with an average price target of $368.51.
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