📊 AXON Key Takeaways
Is Axon Enterprise, Inc.. (AXON) a Good Investment?
Despite strong 33.5% revenue growth and healthy 59.1% gross margins, Axon Enterprise exhibits critical fundamental weaknesses: negative operating cash flow of -$31.5M alongside only 3.6% operating margins signals the company is not efficiently converting sales to cash. Heavy reliance on non-operating gains to drive net income (net income $169.3M vs operating income $29.2M of only 3.6% margin) suggests unsustainable business quality and acquisition-driven growth rather than organic operational improvement.
Axon shows strong top-line momentum with 33.5% revenue growth and a high 59.7% gross margin, indicating durable demand and attractive unit economics. However, the latest period shows a sharp deterioration in bottom-line profitability, with negative operating margin, a 66.9% drop in net income, and weak free cash flow conversion. The balance sheet is healthy and liquidity is strong, but fundamentals currently support a wait-and-see stance until earnings quality improves.
Axon Enterprise, Inc.. Key Strengths (AXON)
- Strong top-line revenue growth of 33.5% YoY demonstrating robust market demand
- Healthy gross margin of 59.1% indicating strong product pricing power and production efficiency
- Solid balance sheet with reasonable 0.49x debt-to-equity ratio and adequate $458.9M cash position
- Strong liquidity with 2.27x current ratio providing financial flexibility
- Strong revenue growth of 33.5% YoY indicates continued business expansion and demand strength
- High gross margin of 59.7% suggests strong pricing power and favorable product/software mix
- Solid financial health with $1.20B cash, current ratio of 2.53x, and moderate debt/equity of 0.56x
AXON Stock Risks: Axon Enterprise, Inc.. Investment Risks
- Critical negative operating cash flow of -$31.5M despite positive net income signals poor cash conversion and fundamental business sustainability issues
- Extremely low 3.6% operating margin despite 59.1% gross margin indicates bloated operating expenses and severe operational inefficiency
- Heavy reliance on non-operating gains (net income $169.3M vs operating income $29.2M) suggests acquisition-driven accounting profits rather than genuine operational improvement
- Significant 68.5% YoY EPS decline despite revenue growth indicates substantial shareholder dilution from acquisitions
- Very low ROE of 4.8% and ROA of 2.4% demonstrate poor capital deployment returns relative to growth metrics
- Operating margin turned negative at -2.2%, indicating cost growth is outpacing revenue growth
- Net income and diluted EPS fell sharply YoY, raising concern about earnings durability and margin compression
- Free cash flow margin of 2.7% is thin relative to revenue scale, limiting cash generation quality
Key Metrics to Watch
- Operating cash flow - must return to positive to validate business sustainability
- Operating margin expansion - SG&A expense control relative to revenue growth is critical
- Free cash flow generation - negative -$54.6M FCF trend direction
- Organic vs acquisition revenue mix - determine quality of growth
- Working capital efficiency - root cause analysis of negative OCF despite profitability
- Operating margin trend
- Free cash flow conversion
Axon Enterprise, Inc.. (AXON) Financial Metrics & Key Ratios
💡 AI Analyst Insight
Strong liquidity with a 2.27x current ratio provides a solid financial cushion.
AXON Profit Margin, ROE & Profitability Analysis
AXON vs Market Sector: How Axon Enterprise, Inc.. Compares
How Axon Enterprise, Inc.. compares to Market sector averages
Sector benchmarks are approximate industry averages. Actual sector performance may vary.
Is Axon Enterprise, Inc.. Stock Overvalued? AXON Valuation Analysis 2026
Based on fundamental analysis, Axon Enterprise, Inc.. has mixed fundamental signals relative to the Market sector in 2026.
Note: This is a fundamental analysis based on SEC filings. For P/E ratio, price targets, and market-based valuation, consult financial data providers. This is not investment advice.
Axon Enterprise, Inc.. Balance Sheet: AXON Debt, Cash & Liquidity
AXON Revenue & Earnings Growth: 5-Year Financial Trend
5-Year Trend Summary: Axon Enterprise, Inc..'s revenue has grown significantly by 222% over the 5-year period, indicating strong business expansion. The most recent EPS of $2.33 reflects profitable operations.
AXON Revenue Growth, EPS Growth & YoY Performance
AXON Quarterly Earnings & Performance
| Quarter | Revenue | Net Income | EPS |
|---|---|---|---|
| Q1 2026 | $603.6M | $88.0M | $1.08 |
| Q3 2025 | $544.3M | -$2.2M | $-0.03 |
| Q2 2025 | $503.2M | $36.1M | $0.44 |
| Q1 2025 | $459.9M | $88.0M | $1.08 |
| Q3 2024 | $413.3M | $11.5M | $0.81 |
| Q2 2024 | $374.6M | $12.4M | $0.16 |
| Q1 2024 | $343.0M | $45.1M | $0.61 |
| Q3 2023 | $311.8M | $12.1M | $0.17 |
Data sourced from SEC EDGAR 10-Q quarterly filings. Figures may represent quarterly or cumulative values.
Axon Enterprise, Inc.. Dividends, Buybacks & Capital Allocation
AXON SEC Filings: Latest 10-K & 10-Q Analysis
Access official SEC EDGAR filings for Axon Enterprise, Inc.. (CIK: 0001069183)
📋 Recent SEC Filings
| Date | Form | Document | Action |
|---|---|---|---|
| Jun 8, 2026 | 4 | xslF345X06/wk-form4_1780953065.xml | View → |
| Jun 8, 2026 | 4 | xslF345X06/wk-form4_1780952370.xml | View → |
| Jun 8, 2026 | 4 | xslF345X06/wk-form4_1780952214.xml | View → |
| Jun 8, 2026 | 4 | xslF345X06/wk-form4_1780952044.xml | View → |
| Jun 3, 2026 | 4 | xslF345X06/wk-form4_1780518355.xml | View → |
❓ Frequently Asked Questions about AXON
What is the AI rating for AXON?
Axon Enterprise, Inc.. (AXON) has a Combined AI Grade of C from Claude (C) and ChatGPT (B) with 75% combined confidence, based on fundamental analysis of SEC EDGAR filings.
What are AXON's key strengths?
Claude: Strong top-line revenue growth of 33.5% YoY demonstrating robust market demand. Healthy gross margin of 59.1% indicating strong product pricing power and production efficiency. ChatGPT: Strong revenue growth of 33.5% YoY indicates continued business expansion and demand strength. High gross margin of 59.7% suggests strong pricing power and favorable product/software mix.
What are the risks of investing in AXON?
Claude: Critical negative operating cash flow of -$31.5M despite positive net income signals poor cash conversion and fundamental business sustainability issues. Extremely low 3.6% operating margin despite 59.1% gross margin indicates bloated operating expenses and severe operational inefficiency. ChatGPT: Operating margin turned negative at -2.2%, indicating cost growth is outpacing revenue growth. Net income and diluted EPS fell sharply YoY, raising concern about earnings durability and margin compression.
What is AXON's revenue and growth?
Axon Enterprise, Inc.. reported revenue of $807.3M.
Does AXON pay dividends?
Axon Enterprise, Inc.. does not currently pay dividends.
Where can I find AXON SEC filings?
Official SEC filings for Axon Enterprise, Inc.. (CIK: 0001069183) including 10-K, 10-Q, and 8-K reports are available on SEC EDGAR.
What is AXON's EPS?
Axon Enterprise, Inc.. has a diluted EPS of $2.05.
How is the AI analysis conducted?
Two independent AI systems — Claude (Anthropic) and ChatGPT (OpenAI) — analyze SEC EDGAR filings including 10-K annual reports and 10-Q quarterly reports. Each AI evaluates financial health, profitability ratios, balance sheet strength, and growth metrics. The combined grade reflects both perspectives for balanced insights.
What is AXON's fundamental grade?
Based on our AI fundamental analysis in June 2026, Axon Enterprise, Inc.. has a C grade with 75% confidence. Review the strengths and risks sections above for full context. This is not investment advice.
Is AXON stock overvalued or undervalued?
Valuation metrics for AXON: ROE of 4.8% (sector avg: 15%), net margin of 21.0% (sector avg: 12%). Compare these metrics with sector averages to assess valuation.
What is AXON's AI grade for 2026?
Our dual AI analysis gives Axon Enterprise, Inc.. a combined C grade for 2026. Revenue is data pending, with profitability above sector average. Always conduct your own research.
What is AXON's free cash flow?
Axon Enterprise, Inc..'s operating cash flow is $-31.5M, with capital expenditures of $23.1M. FCF margin is -6.8%.
How does AXON compare to other Market stocks?
Vs Default sector averages: Net margin 21.0% (avg: 12%), ROE 4.8% (avg: 15%), current ratio 2.27 (avg: 1.8).