Axon Enterprise is among the biggest S&P 500 gainers early Thursday after comfortably beating first-quarter earnings estimates and raising its full-year outlook. International sales and demand for its Draft One AI tool are helping power growth, even as new federal government contract activity is in limbo amid DOGE-led budget cutting.
Axon just added to its AI product suite, introducing Axon Assistant, which provides body cameras with voice-enabled translation supporting 50 languages at launch. CEO Rick Smith also highlighted the next-generation Apollo Dart for its Taser 10 weapon "that really gives us a shot at displacing lethal force."
Axon Earnings
Results: Axon posted Q1 adjusted earnings per share of $1.41, up 23% from a year ago and 14 cents above estimates. Revenue grew 31% to $603.6 million vs. estimates of $586.4 million.
Outlook: Axon raised its full-year revenue outlook to a range of $2.6 billion-$2.7 billion, up from $2.55 billion-$2.65 billion. That's about 27% growth at the midpoint. Axon also raised its outlook for adjusted earnings before interest, taxes, depreciation and amortization to a range of $650 million-$675 million. That's up from the prior range of $640 million-$670 million.
Axon stood by its outlook for an EBITDA margin of about 25%, even factoring in current-level tariffs. While the Taser in manufactured in Arizona, some supplies are imported.
Axon Stock
Axon jumped 6.8% to 642.49 in early Thursday stock market action. On April 23, Axon gapped above its 50-day line and has continued climbing. Shares finished about 16% below a 715.99 cup buy point on Wednesday.
Investors could use the May 2 high of 638.35 as an early entry.
Given current market conditions, IBD generally suggests investors keep most of their portfolio focused on stocks whose average true range, a measure of volatility, is at or below 6%. Axon has a 21-day ATR of 4.07, according to MarketSurge.
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