Axon Enterprise (AXON) Q1 Earnings & Revenues Top Estimates
Axon Enterprise, Inc. AXON reported first-quarter 2024 adjusted earnings of $1.15 per share, which surpassed the Zacks Consensus Estimate of 97 cents. The bottom line increased 30.7% year over year despite a significant rise in the cost of sales.
Total revenues of $460.7 million outperformed the Zacks Consensus Estimate of $438 million and increased 34.3% year over year. The top line benefited from continued strength in Axon Cloud & Services, increasing adoption of TASER 10 driving growth in TASER devices and cartridges, and the adoption of Axon Body 4.
Total operating expenses climbed 30% year over year to $243.8 million. The gross margin declined to 56.4% from 59.5% in the year-ago period.
Segmental Details in Q1
Software & Sensors: Within this segment, Axon’s Cloud and Services revenues rose 51.5% to $176.5 million. The uptick was driven by user growth and increasing adoption of premium add-on features related to Axon Evidence, real-time operations and productivity software. Axon Cloud’s gross margin deteriorated to 72.8% from 73.2% in the year-ago period due to increased stock-based compensation expense related to vesting events from a one-time enhanced equity compensation program and amortization expense of acquired intangible assets.
Sensors & Other revenues climbed 14.3% to $105.5 million driven by increased demand for Axon Body cameras and accessories. The gross margin improved to 38.7% from 38.2% in the year-ago period supported by improvement from manufacturing overhead reallocations made in the second quarter of 2023.
TASER: The segment’s revenues jumped 33.1% year over year to $178.7 million, driven by growth in professional devices and cartridges, associated with rising volumes of TASER 10 and Evidence & Cloud services, supported by increased connected devices in the field and growing adoption of VR products.
Axon Enterprise, Inc Price, Consensus and EPS Surprise
Axon Enterprise, Inc price-consensus-eps-surprise-chart | Axon Enterprise, Inc Quote
Balance Sheet & Cash Flow
At the end of the first quarter, Axon had cash and cash equivalents of $403.9 million compared with $598.5 million in December 2023 end. Long-term lease liabilities totaled $32.5 million compared with $33.6 million in 2023 end.
In the first three months of 2024, AXON, currently carrying a Zacks Rank #2 (Buy), spent net cash of $15.9 million on operating activities compared with $56.3 million cash spent a year ago. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Adjusted free cash outflow was $26.1 million in the first three months of 2024 compared with $60.1 million cash outflow in the prior year.
Outlook
For 2024, Axon Enterprise expects revenues in the range of $1.94-$1.99 billion, indicating approximately 26% year-over-year growth at the midpoint. Adjusted EBITDA is expected to be approximately $430-$445 million with a continued margin expansion from 2023.
The company expects capital expenditures to be between $80 million and $95 million. This includes investments in TASER 10 automation and capacity expansion. It anticipates stock-based compensation expenses in the range of $215-$230 million for the year.
Performance of Other Industrial Companies
IDEX Corporation’s IEX second-quarter 2024 adjusted earnings of $1.88 per share surpassed the Zacks Consensus Estimate of $1.75. On a year-over-year basis, the bottom line declined approximately 10.1%.
IDEX’s net sales of $800.5 million underperformed the consensus estimate of $805 million. The top line also decreased 5.3% year over year.
A. O. Smith Corporation’s AOS second-quarter 2024 adjusted earnings of $1.00 per share surpassed the Zacks Consensus Estimate of 99 cents. The bottom line increased 6% on a year-over-year basis.
Net sales of $978.8 million missed the consensus estimate of $995 million. However, the top line inched up 1% year over year, driven by strong demand for commercial water heaters in North America.
W.W. Grainger, Inc. GWW has reported earnings per share of $9.62 in second-quarter 2024, beating the Zacks Consensus Estimate of $9.58. The bottom line improved 0.1% year over year.
Grainger’s quarterly revenues rose 3.5% year over year to $4.24 billion. The top line missed the consensus estimate of $4.27 billion.
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