Axon(US:AXON)2025-02-25 21:08Revenue Growth - Axon reported a 33% increase in annual revenue to $2.1 billion, marking the third consecutive year of over 30% growth[1]. - Q4 2024 revenue reached a record $575 million, up 34% year over year, with TASER revenue growing 37% to $221 million[2]. - Axon Cloud & Services revenue grew 41% year over year to $230 million, accounting for 40% of total revenue[2]. - The company expects 2025 annual revenue between $2.55 billion and $2.65 billion, reflecting approximately 25% growth[3]. - Axon surpassed $1 billion in annual recurring revenue and achieved total future contracted bookings of $10.1 billion[6]. - Future contracted bookings rose to $10.1 billion, reflecting a 42% year-over-year increase, with expectations to recognize 20% to 25% of this balance over the next 12 months[36]. - Axon anticipates full year 2025 revenue between $2.55 billion and $2.65 billion, representing approximately 25% annual growth at the midpoint[37]. Profitability and Margins - Adjusted EBITDA for 2025 is projected to be between $640 million and $670 million, with an expected margin of approximately 25%[37]. - Axon Cloud & Services gross margin decreased to 73.7% from 74.7% year-over-year, while adjusted gross margin improved to 77.2% from 75.7%[32]. - Sensors & Other gross margin decreased to 32.8% from 46.9% year-over-year, impacted by product mix and inventory reserve charges[32]. - Gross margin for the twelve months ended December 31, 2024, was $1.241 billion, up from $955.453 million for the same period in 2023, indicating a year-over-year growth of 30%[55]. - Adjusted gross margin for the twelve months ended December 31, 2024, was 63.2%, compared to 61.8% for the previous year[56]. - Gross margin for Q4 2024 was 60.1%, slightly down from 60.8% in Q3 2024 but consistent with 61.3% in Q4 2023[62]. - Adjusted gross margin for Q4 2024 was 63.2%, unchanged from Q3 2024 and an increase from 62.0% in Q4 2023[62]. Operating Performance - Operating cash flow increased 79% year over year to $250 million, supporting free cash flow of $225 million[24]. - Net income for Q4 2024 was $135.184 million, compared to $67.025 million in Q3 2024 and $57.061 million in Q4 2023, representing a significant increase of 101.5% year-over-year[55]. - Basic net income per share for Q4 2024 was $1.77, compared to $0.89 in Q3 2024 and $0.76 in Q4 2023, reflecting a year-over-year increase of 132.9%[55]. - Total operating expenses for the twelve months ended December 31, 2024, were $1.183 billion, up from $798.603 million in 2023, marking a 48.3% increase[55]. - Non-GAAP net income for Q4 2024 was $168.284 million, an increase from $113.452 million in Q3 2024 and $85.864 million in Q4 2023[61]. Investments and Expenditures - Capital expenditures for 2025 are projected to be between $140 million and $180 million, focusing on R&D investments and capacity expansion[37]. - Research and development expenses for Q4 2024 were $134.585 million, an increase of 17.6% from $114.477 million in Q3 2024 and a 60.3% increase from $83.972 million in Q4 2023[55]. - The company reported a net cash used in investing activities of $490,573 thousand for the twelve months ended December 31, 2024, compared to a net cash provided of $12,476 thousand in the previous year[67]. - Purchases of property and equipment for the three months ended December 31, 2024, were $24,801 thousand, slightly lower than $24,011 thousand in the same period of 2023[68]. Market Position and Strategy - The total addressable market (TAM) is estimated at $129 billion, with less than 2% penetration in annual revenue[12][14]. - Axon introduced AI-powered solutions, saving officers 2.2 million minutes through AI-driven incident reporting[4]. - The acquisition of Fusus enhances real-time crime center technology, supporting millions of livestreams across over 2,000 agencies[7]. - The company plans to realign its business segments to better reflect growth, transitioning to Connected Devices and Software & Services[26]. - Axon plans to continue focusing on product innovation and market expansion despite the identified risks and uncertainties[51]. Financial Position - Total current assets decreased to $2.3 billion as of December 31, 2024, from $2.4 billion a year earlier[66]. - Total liabilities increased to $2.1 billion as of December 31, 2024, compared to $1.8 billion in the previous year[66]. - Cash and cash equivalents decreased to $454.8 million as of December 31, 2024, from $598.5 million a year earlier[66]. - The company’s total assets increased to $4.5 billion as of December 31, 2024, from $3.4 billion a year earlier[66]. - Deferred revenue increased to $155,641 thousand for the twelve months ended December 31, 2024, compared to $146,819 thousand for the same period in 2023, showing a growth of 6%[67].