What Happened?
Shares of self defense company AXON (NASDAQ: AXON) jumped 23.8% in the morning session after it reported strong fourth-quarter financial results that beat Wall Street's expectations and provided an upbeat outlook for the future.
For the quarter, Axon's revenue reached $796.7 million, marking a 38.5% increase compared to the same period in the previous year and surpassing analysts' forecasts. The company's adjusted earnings per share came in at $2.15, which was significantly higher than the consensus estimate of $1.60. This strong performance and confident guidance appeared to drive positive investor sentiment.
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What Is The Market Telling Us
Axon’s shares are very volatile and have had 23 moves greater than 5% over the last year. But moves this big are rare even for Axon and indicate this news significantly impacted the market’s perception of the business.
The biggest move we wrote about over the last year was 4 months ago when the stock dropped 18.5% on the news that the company reported third-quarter results that missed profit expectations and provided weak EBITDA guidance for the upcoming quarter.
While revenue for the quarter grew 30.6% year-on-year to $710.6 million, beating Wall Street's estimates, investors focused on the negatives. The company's adjusted earnings per share of $1.17 came in 24.1% below the consensus estimate of $1.54. Furthermore, Axon's EBITDA guidance for the fourth quarter was below analyst expectations. The company also saw its operating margin contract, falling to -0.3% from 4.4% in the same quarter last year, indicating rising expenses were outpacing revenue growth. Despite the earnings miss, the company's revenue guidance for the next quarter was slightly ahead of forecasts.
Axon is down 5.3% since the beginning of the year, and at $533.49 per share, it is trading 38.7% below its 52-week high of $870.97 from August 2025. Investors who bought $1,000 worth of Axon’s shares 5 years ago would now be looking at an investment worth $3,336.
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