Highlights

  • Third quarter net sales were USD 908.6 million, up 28% year over year.
  • Annual Recurring Revenue rose 40% to USD 1.8 billion.
  • Fourth quarter revenue outlook is USD 990 million to USD 1.01 billion.
  • Diluted earnings per share were USD 0.68 against a loss of USD 0.03.

Axon Enterprise, Inc. (NASDAQ:AXON) shares were trading near their 52-week low at USD 320.54 on November 6, 2026, down 16.21% on the day. The public safety technology company reported third quarter net sales of USD 908.6 million, up 28%, and Diluted Earnings per Share of USD 0.68.

The company has a market Capitalization of about USD 26.04 billion at the current price. Management said the fourth quarter outlook no longer includes two large federal Dedrone deployments totaling approximately USD 100 million.

Third Quarter Results

Net sales were USD 908,554 thousand against USD 710,641 thousand. Connected Devices net sales were USD 471.5 million, up 16%, and Software and Services net sales were USD 437.0 million, up 43.2%. Within Connected Devices, TASER revenue of USD 233 million declined modestly, and management said Body 4 grew 25% sequentially.

Gross Margin was USD 514,978 thousand against USD 427,348 thousand. Management put adjusted gross margin at 59.2% and said it continues to show product mix and higher component costs, particularly memory. Total operating expenses were USD 472,898 thousand against USD 429,477 thousand, and income from operations was USD 42,080 thousand against a loss of USD 2,129 thousand.

Net income was USD 57,006 thousand against a net loss of USD 2,186 thousand. Diluted earnings per share were USD 0.68 against a loss of USD 0.03.

Nine-Month Results

Net sales were USD 2,620,288 thousand against USD 1,982,812 thousand. Income from operations was USD 118,101 thousand against a loss of USD 11,958 thousand. Net Income was USD 255,745 thousand against USD 121,911 thousand, and diluted earnings per share were USD 3.08 against USD 1.48. Net cash provided by Operating Activities was USD 8,247 thousand against cash used of USD 5,896 thousand.

Recurring Revenue and Bookings

Management said annual recurring revenue increased 40% year over year to USD 1.8 billion, with net revenue retention of 126%. It said AI products have passed USD 100 million in annual recurring revenue, and that real time operations, records, AI, Dedrone software and 911 together reached an annual revenue run rate of nearly USD 500 million. Platform Solutions revenue grew 106% to USD 125 million. Future contracted bookings stood at USD 15.8 billion.

Outlook

Management guided fourth quarter revenue of USD 990 million to USD 1.01 billion, and fourth quarter adjusted EBITDA of approximately USD 245 million to USD 250 million, implying full year adjusted EBITDA of USD 924 million to USD 929 million, or about 25.6% of revenue. It said that, with those deployments removed, growth at the midpoint would still be above 30% for the fifth straight year.

Full year free Cash Flow is expected at USD 350 million to USD 400 million, against a prior target of USD 450 million, as the company builds inventory toward target levels in the first half of 2027.

Skydio Investment

The company announced an expanded commercial Partnership with Skydio and an additional USD 1.2 billion investment, taking its fully diluted ownership to 37%. Management described it as the largest Investment in Axon's history.

Balance Sheet

Cash and cash equivalents were USD 1,458,817 thousand against USD 1,201,147 thousand at December 31, 2025. Total Assets were USD 8,832,777 thousand against USD 7,000,313 thousand. Total liabilities were USD 5,069,849 thousand against USD 3,757,655 thousand, and total stockholders' Equity was USD 3,762,928 thousand against USD 3,242,658 thousand. There were 81,432,712 shares outstanding as of October 30, 2026.