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Axon Enterprise's (AAXN) Q3 Earnings Miss, Revenues Up Y/Y

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Axon Enterprise, Inc.’s third-quarter 2017 earnings came in at 1 cent per share, missing the Zacks Consensus Estimate of 5 cents by 80%. The bottom line also declined 85.7% year over year, mainly due to lower operating income.

Total Revenue

In the quarter, the company generated revenues of $90.3 million that increased 25.6% year over year. The upside can be attributed to higher sales from both the TASER Weapon as well as the Software and sensors segments.

Revenues from the TASER Weapons segment rose 12.2% year over year to $59.4 million. Software and sensors segment revenues surged 41.9% to $14.6 million.

Segment bookings declined 4.8% to $78 million as of Sep 30, from $81.9 million in the preceding quarter. However, bookings increased 35.6% year over year.

Highlights From the Quarter

Axon’s gross margin contracted 1000 basis points year over year to 55% from 65% a year ago.

Total operating expenses increased 42.5% year over year to $50.6 million. The uptick was primarily owing to higher sales, general and administrative expenses (up 29.4%) and research and development expenses (up 92.5%).

Axon Enterprise, Inc. Price, Consensus and EPS Surprise

Axon Enterprise, Inc. Price, Consensus and EPS Surprise | Axon Enterprise, Inc. Quote

Financials

Axon had cash and cash equivalents of $43.5 million as of Sep 30, 2017, compared with $40.7 million as of Dec 31, 2016.

Net cash flow from operating activities was $6.6 million in the reported quarter compared with cash inflow of $11.6 million in the year-ago period. Free cash outflow was $1.1 million versus cash inflow of $10.1 million a year ago.

Zacks Rank

Axon Enterprise carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Peer Releases

Allegion plc’s (ALLE - Free Report) third-quarter 2017 adjusted earnings came in at $1.02 per share in line with the Zacks Consensus Estimate. Adjusted earnings were up 9.7% from the prior-year quarter.

Fortune Brands Home & Security, Inc. reported better-than-expected bottom-line results for third-quarter 2017, beating estimates by 1.2%.

Johnson Controls International plc (JCI - Free Report) posted adjusted earnings of 71 cents per share in third-quarter fiscal 2017 (ended Jun 30, 2017), which came in line with the Zacks Consensus Estimate. Moreover, earnings increased 16% from 61 cents in third-quarter fiscal 2016.

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