revenue growth
32–34 pct
FY 2026
official guidance
| Revenue | $3.2B |
|---|---|
| Operating income | $76.0M |
| Net income | $199.3M |
| Free cash flow | $133.2M |
| Operating margin | 2.4% |
| Net margin | 6.2% |
| Return on equity | 5.4% |
| Period | TTM 2026-06-30 |
OpenFilings analyst
Agentic read of the latest earnings call — recommendation updates when we process a new transcript. Research synthesis, not investment advice.
Exceptional demand breadth and ecosystem expansion outweigh near-term margin and execution risks.
Latest call · Q2 2026Buy: Axon delivered $904 million of Q2 revenue, up 35% year over year, with 126% net revenue retention, $1.6 billion ARR up 39%, and adjusted EBITDA of $242 million at a 26.8% margin.
Broad-based bookings momentum, rapidly scaling Dedrone and software, and a raised FY2026 revenue-growth outlook of 32%-34% support the bull case, but memory costs, weak near-term free cash flow, long government sales cycles, and uncertainty around the DHS counter-drone award temper upside.
Q3 body-camera shipments are expected to rise 20%-30% sequentially, with management suggesting growth could be near the top end of the range.
Q3 adjusted EBITDA margin is expected to absorb higher memory costs and the absence of Q2 tariff-refund benefits before improving in Q4.
Q4 seasonality is expected to remain strong and more heavily weighted, making second-half bookings conversion the key near-term execution test.
Dedrone revenue has surpassed a $100 million quarterly run rate, but hardware shipments may create quarter-to-quarter volatility and the World Cup could have accelerated Q2 demand.
Software beyond the core evidence platform now represents more than one-third of software revenue and is growing roughly 70%, while the AI Era Plan grew nearly 700%; continued attachment is central to the 2028 thesis.
The ecosystem is showing stronger expansion economics: NRR reached 126%, and platform products can create a software revenue tail after initial hardware deployments.
International, enterprise, federal, corrections, and 911 broaden the addressable market beyond U.S. state and local public safety, reducing dependence on the legacy body-camera and Taser categories.
Axon's customer-controlled data repository, integrated workflows, privacy controls, and cross-agency network effects are credible moat candidates, particularly as customers win back from competing body-camera vendors.
Counter-drone could become a major platform category, but the strategy depends on Axon's ability to integrate rapidly evolving third-party sensors and effectors rather than owning every hardware layer.
Management did not quantify Axon's expected share of the $1.5 billion DHS Counter-UAS program; selection validates the offering but does not establish material revenue.
The new five-year normalized bookings metric improves comparability as deal durations change, but its limited historical disclosure makes trend interpretation less transparent than total contracted bookings.
Adjusted gross margin benefited from a Q2 tariff refund, while higher memory costs are expected to pressure Q3; newer businesses are also carrying mix dilution as they scale.
Free cash flow was negative $1 million in Q2 despite $242 million of adjusted EBITDA because of inventory investment, leaving the $450 million full-year target dependent on strong Q4 conversion.
AI adoption remains subject to public-sector privacy, security, surveillance, and governance concerns; management acknowledged high-profile misuse cases and that critics are not entirely wrong.
Large AI, OSP, international, and enterprise deals still generally take up to a year to close, so strong pipeline commentary is not equivalent to near-term revenue certainty.
revenue growth
32–34 pct
FY 2026
official guidance
ebitda
25.5–25.5 pct
FY 2026
official guidance
OpenFilings analyst view from primary-source filings and earnings calls — not investment advice.
AXON ENTERPRISE, INC.
AXON ENTERPRISE, INC.
AXON ENTERPRISE, INC.
AXON ENTERPRISE, INC.
AXON ENTERPRISE, INC.
AXON ENTERPRISE, INC.