Axon (AXON) stock Q3 earnings 2025

Axon CorporationShares fall 11% after Taser maker misses Wall Street third quarter Profit expectations as they grapple with tariff restrictions.

Adjusted earnings came in at $1.17 per share, below LSEG’s estimate of $1.52 per share. Adjusted gross margins fell 50 basis points from a year ago to 62.7%, which Axon attributed to tariff impacts.

Axon’s connected devices business, which includes Taser and counter-drone equipment, felt the biggest pinch in the first quarter due to tariffs. The business segment generated more than $405 million in revenue, up 24% year over year.

“I view this as a one-time adjustment as long as the tariffs remain in effect,” Finance Chief Brittany Bagley said during the earnings release. “Now that’s added to the gross margin.”

Bagley expects growth in the company’s software business to offset margin losses in the long run. Software and services revenues increased by 41% compared to the previous year, reaching $305 million.

Total revenue rose 31% year-over-year to $711 million, above the $704 million expected by analysts surveyed by LSEG. The USA accounted for 84% of sales.

The Arizona-based company reported a net loss of $2.2 million, or 3 cents per share, on net income of $67 million, or 86 cents per share, in the same period last year.

Axon raised its full-year revenue outlook to $2.74 billion, from $2.65 billion to $2.73 billion. FactSet analysts expected $2.72 billion at the midpoint.

The company expects revenue of $750 million to $755 million in the fourth quarter; this was above LSEG analysts’ expectations of $746 million.

With the results, Axon said: Buying Carbyne A deal worth $625 million was signed for the emergency communications platform. The deal is expected to be completed in the first quarter of next year.

Axon shares have soared more than 40% in the past year as demand for security tools has increased. Shares more than double in 2024.

“We’re building an elite business that’s still nowhere near its ultimate potential, and we’re doing it with a team that’s being quickly inducted,” Josh Isner, Axon’s president, said on the earnings call.