In This Article:
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Revenue: $604 million, increased 31% year-over-year.
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Adjusted EBITDA Margin: 25.7%.
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Annual Recurring Revenue (ARR): $1.1 billion, increased 34% year-over-year.
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Software and Services Revenue: $263 million, increased 39% year-over-year.
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Connected Devices Revenue: $341 million, grew 26% year-over-year.
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Adjusted Gross Margin: 63.6%, up 40 basis points year-over-year.
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Adjusted Operating Expenses: $236 million, down 140 basis points year-over-year.
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Net Revenue Retention (NRR): 123%.
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2025 Revenue Guidance: $2.6 billion to $2.7 billion, 27% annual growth at midpoint.
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2025 Adjusted EBITDA Guidance: $650 million to $675 million, maintaining 25% margin target.
Release Date: May 07, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
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Axon Enterprise Inc (NASDAQ:AXON) reported a 31% year-over-year increase in first-quarter revenue, reaching $604 million, marking the 13th consecutive quarter with over 25% growth.
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The company achieved a 25.7% adjusted EBITDA margin and $1.1 billion in annual recurring revenue (ARR), reflecting strong financial performance.
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Axon Enterprise Inc (NASDAQ:AXON) has seen rapid adoption of its TASER 10, with orders pacing at twice the rate of TASER 7, indicating strong market demand.
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International bookings are off to a strong start, with significant demand in regions such as Australia, Latin America, Canada, Asia, the UK, and Europe.
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The company has successfully diversified its supply chain to mitigate risks associated with tariffs and geopolitical uncertainties, ensuring better service to customers.
Negative Points
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The company faces potential impacts from tariffs, which are expected to affect the adjusted EBITDA margin by approximately 50 basis points for the full year.
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There are ongoing challenges with federal budget uncertainties, which could impact the volume of opportunities in the federal market.
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Axon Enterprise Inc (NASDAQ:AXON) is still navigating hurdles related to its new headquarters project in Arizona, with some political opposition and obstacles remaining.
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The company is experiencing some supply constraints for its new fixed mobile hardware products, which may limit revenue impact this year.
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There is a risk of slower adoption of AI-related products in jurisdictions that are more skeptical of police technology, potentially affecting sales.
Q & A Highlights
Q: Can you provide an update on the pipeline for Draft One and how it factors into your guidance? A: Joshua Isner, President: The pipeline for Draft One is strong, and the results reflect the work done last year. We have a more predictable Q1 and have built a significant pipeline for Q2 and beyond. The first half of the year is about identifying key opportunities, and we expect stronger results in Q3 and Q4, which will show up in our future contracted bookings.