Axon (AXON) inventory Q3 earnings 2025

Axon Enterprise‘s inventory plummeted 11% after the Taser maker missed Wall Avenue’s third-quarter revenue expectations because it grapples with tariff constraints.

Adjusted earnings totaled $1.17 per share, falling wanting a $1.52 per share forecast from LSEG. Adjusted gross margins dropped 50 foundation factors from a 12 months in the past to 62.7%, which Axon attributed to tariff impacts.

Axon’s related units enterprise, which incorporates its Taser and counter drone gear, felt the most important pinch through the first full quarter with tariffs. The enterprise phase accounted for greater than $405 million in income, rising 24% 12 months over 12 months.

“As lengthy as tariffs keep in place, I view that as type of a one-time adjustment,” finance chief Brittany Bagley mentioned through the earnings name. “Now that is baked into the gross margins.”

Bagley expects development within the firm’s software program enterprise to ultimately offset margin losses long run. Software program and companies income jumped 41% from a 12 months in the past to $305 million.

Whole income grew 31% from a 12 months in the past to $711 million, topping the $704 million anticipated by analysts polled by LSEG. The U.S. accounted for 84% of gross sales.

The Arizona-based firm reported a web lack of $2.2 million, or a lack of 3 cents per share, versus web earnings of $67 million, or 86 cents per share within the year-ago interval.

Axon lifted its full-year income outlook to $2.74 billion, from between $2.65 billion and $2.73 billion. FactSet analysts anticipated $2.72 billion on the midpoint.

The corporate expects income between $750 million and $755 million through the fourth quarter, which was above LSEG analyst expectations of $746 million.

Together with the outcomes, Axon mentioned it’s buying Carbyne in a deal that values the emergency communications platform at $625 million. The deal is predicted to shut subsequent 12 months within the first quarter.

Axon shares have jumped greater than 40% over the past 12 months as demand for its safety instruments accelerates. The shares greater than doubled in 2024.

“We are constructing an elite enterprise that remains to be nowhere close to its final potential, and we’re doing it with a crew that’s quickly purchased into the mission,” mentioned Axon’s president Josh Isner on the earnings name.