Taser maker Axon dives after whiffing on earnings; announces acquisition
Need to reload the Taser after this miss.
Taser and body camera maker Axon reported much softer-than-expected Q3 earnings after the close of trading in New York on Tuesday, and simultaneously announced plans to acquire emergency communications platform Carbyne at a valuation of $625 million.
The market is responding quite negatively to the big whiff on earnings, with the stock tanking by more than 20% in the after-hours session shortly after the results came out.
The company reported:
Adjusted earnings per share of $1.17 vs. the $1.52 consensus estimate.
Q3 sales of $711 million vs. the $704.8 million forecast.
A non-GAAP gross margin of 62.7% vs. the 62.3% anticipated.
Full-year revenue guidance of ~$2.74 billion vs. the $2.72 billion currently expected by Wall Street and up from previous guidance of between $2.65 billion and $2.73 billion.
Axon rallied sharply in the days after President Donald Trump won the 2024 election, as investors seemed to price in a surge in funding for police under the Trump administration. The stock was one of a number of so-called “Trump trades” that appeared well positioned to do well under a Trump administration, either because of personal connections with the White House or because its business was well aligned with expected policy priorities.
Axon was up as much as 90% between the election and early August, but since then the stock’s gains have fizzled down to 62% since Trump defeated former Vice President Kamala Harris. Another Trump trade, federal deportation contractor GEO Group, has done worse, losing virtually all of its post-election gains, which at one time pushed the shares up 133%.
