We use cookies to understand how you use our site and to improve your experience.
This includes personalizing content and advertising.
By pressing "Accept All" or closing out of this banner, you consent to the use of all cookies and similar technologies and the sharing of information they collect with third parties.
You can reject marketing cookies by pressing "Deny Optional," but we still use essential, performance, and functional cookies.
In addition, whether you "Accept All," Deny Optional," click the X or otherwise continue to use the site, you accept our Privacy Policy and Terms of Service, revised from time to time.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
AXON's Software & Services Growth Picks Up: Can the Momentum Sustain?
Read MoreHide Full Article
Key Takeaways
Axon's Software and Services revenues jumped 39.6% in the first nine months of 2025.
Growth is fueled by rising Axon network users, premium add-ons and recurring service purchases.
AXON raised its 2025 revenue outlook to about $2.74B, signaling roughly 31% year-over-year growth.
Axon Enterprise, Inc. (AXON - Free Report) has been benefiting from persistent strength in its Software & Services segment, supported by growth in the aggregate number of users to the Axon network. Revenues from the segment increased 39.6% year over year in the first nine months of 2025. Solid momentum in digital evidence management and increased demand for premium add-on features are driving the segment’s growth.
Adoption of premium subscription plans continues to be strong as more customers recognize the value of enhanced capabilities. Existing customers are consistently returning to purchase additional services, reflecting strong customer retention and satisfaction. This ongoing expansion supports a growing base of annual recurring revenues (ARR). In addition, solid demand for TASER devices, virtual reality training services and counter-drone equipment augurs well for the company’s growth.
Growing instances of terrorism and criminal activities, with concerns related to the ever-increasing fraudulent activities, will augur well for Axon’s products in the quarters ahead. Driven by its business strength, Axon raised its financial guidance for 2025. AXON currently expects revenues to be approximately $2.74 billion compared with $2.65-$2.73 billion expected earlier. The guidance indicates growth of approximately 31% on a year-over-year basis.
Segment Performance of AXON's Peers
Among its major peers, Teledyne Technologies Incorporated’s (TDY - Free Report) Digital Imaging segment’s third-quarter 2025 revenues increased 2.2% year over year to $785.4 million. The jump was due to higher sales of commercial infrared imaging components and subsystems, unmanned air systems and industrial automation imaging systems. Teledyne generated 51% of its total revenues from this segment in the quarter.
Its another peer, Woodward, Inc.’s (WWD - Free Report) Industrial business segment reported net sales of $334 million in the fourth quarter of fiscal 2025, up 10.6% year over year. Woodward generated 33.6% of its total sales from this segment in the quarter. The increase in revenues for Woodward’s segment is primarily attributable to strength across power generation and oil & gas markets.
AXON’s Price Performance, Valuation and Estimates
Shares of Axon have lost 16% in the past year against the industry’s growth of 13.9%.
Image Source: Zacks Investment Research
From a valuation standpoint, AXON is trading at a forward price-to-earnings ratio of 70.1X, above the industry’s average of 43.4X. Axon carries a Value Score of F.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for AXON’s 2025 earnings has decreased 8.1% over the past 30 days.
Image: Bigstock
AXON's Software & Services Growth Picks Up: Can the Momentum Sustain?
Key Takeaways
Axon Enterprise, Inc. (AXON - Free Report) has been benefiting from persistent strength in its Software & Services segment, supported by growth in the aggregate number of users to the Axon network. Revenues from the segment increased 39.6% year over year in the first nine months of 2025. Solid momentum in digital evidence management and increased demand for premium add-on features are driving the segment’s growth.
Adoption of premium subscription plans continues to be strong as more customers recognize the value of enhanced capabilities. Existing customers are consistently returning to purchase additional services, reflecting strong customer retention and satisfaction. This ongoing expansion supports a growing base of annual recurring revenues (ARR). In addition, solid demand for TASER devices, virtual reality training services and counter-drone equipment augurs well for the company’s growth.
Growing instances of terrorism and criminal activities, with concerns related to the ever-increasing fraudulent activities, will augur well for Axon’s products in the quarters ahead. Driven by its business strength, Axon raised its financial guidance for 2025. AXON currently expects revenues to be approximately $2.74 billion compared with $2.65-$2.73 billion expected earlier. The guidance indicates growth of approximately 31% on a year-over-year basis.
Segment Performance of AXON's Peers
Among its major peers, Teledyne Technologies Incorporated’s (TDY - Free Report) Digital Imaging segment’s third-quarter 2025 revenues increased 2.2% year over year to $785.4 million. The jump was due to higher sales of commercial infrared imaging components and subsystems, unmanned air systems and industrial automation imaging systems. Teledyne generated 51% of its total revenues from this segment in the quarter.
Its another peer, Woodward, Inc.’s (WWD - Free Report) Industrial business segment reported net sales of $334 million in the fourth quarter of fiscal 2025, up 10.6% year over year. Woodward generated 33.6% of its total sales from this segment in the quarter. The increase in revenues for Woodward’s segment is primarily attributable to strength across power generation and oil & gas markets.
AXON’s Price Performance, Valuation and Estimates
Shares of Axon have lost 16% in the past year against the industry’s growth of 13.9%.
Image Source: Zacks Investment Research
From a valuation standpoint, AXON is trading at a forward price-to-earnings ratio of 70.1X, above the industry’s average of 43.4X. Axon carries a Value Score of F.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for AXON’s 2025 earnings has decreased 8.1% over the past 30 days.
Image Source: Zacks Investment Research
The company currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.