Axon (AXON) to Report Q3 Earnings: What's in the Cards?
Axon Enterprise AXON is scheduled to release third-quarter 2023 results on Nov 7, after market close.
The company has a stellar earnings surprise history, having outperformed the Zacks Consensus Estimate in each of the preceding four quarters, the average beat being 60.2%.
Let’s see how things have shaped up for Axon this earnings season.
Axon Enterprise, Inc Price and EPS Surprise
Axon Enterprise, Inc price-eps-surprise | Axon Enterprise, Inc Quote
Factors to Note
Axon has been thriving on the back of strength in its TASER segment due to strong demand for its latest generation energy device — TASER 7. Segmental performance is expected to reflect solid demand for the newly launched next-generation energy device, TASER 10. The Zacks Consensus Estimate for TASER revenues in the third quarter indicates a 12.4% increase from the year-ago reported number.
The Software & Sensors segment is expected to generate higher revenues in the to-be-reported quarter due to strong demand for Axon Cloud SaaS solutions and Axon Fleet 3 systems. Higher shipments of Axon Fleet 3 in-car cameras are also expected to drive segmental revenues. Customer response for Axon’s newly launched next-generation body-worn camera, Axon Body 4, has been strong so far. This is another growth driver for the segment. The consensus mark for Software & Sensors revenues hints at a 38.3% jump from the year-ago reported number.
However, the escalating cost of sales due to raw material cost inflation may weigh on AXON’s bottom line in the to-be-reported quarter. Hefty investments in research and development may also impede performance.
What Does the Zacks Model Say?
Our proven model does not conclusively predict an earnings beat for Axon this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of beating estimates, which is not the case here, as elaborated below.
Earnings ESP: Axon has an Earnings ESP of 0.00% as both the Most Accurate Estimate and the Zacks Consensus Estimate are pegged at 76 cents. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: Axon currently carries a Zacks Rank #2.
Highlights of Q2 Earnings
Axon reported second-quarter 2023 adjusted earnings of $1.11 per share, which comfortably beat the Zacks Consensus Estimate of 62 cents. The bottom line increased significantly year over year despite a 27.6% jump in the cost of sales. Total revenues of $374.6 million outperformed the Zacks Consensus Estimate of $347.5 million and augmented 31.2% year over year. The top line benefited from strength in Axon Cloud software, Axon Fleet and gradual ramp-up in the TASER 10 platform.
Stocks to Consider
Here are some companies within the broader Industrial Products sector, which, according to our model, have the right combination of elements to beat on earnings in this reporting cycle.
Emerson Electric Co. EMR has an Earnings ESP of +1.18% and sports a Zacks Rank #1. The company is scheduled to release fourth-quarter fiscal 2023 (ended Sep 30, 2023) financial numbers on Nov 7. You can see the complete list of today’s Zacks #1 Rank stocks here.
Emerson pulled off a trailing four-quarter earnings surprise of 7.4%, on average. The stock has gained 8.2% in the past six months.
LegalZoom.com LZ has an Earnings ESP of +17.65% and a Zacks Rank #2. The company is slated to release third-quarter 2023 results on Nov 7.
LegalZoom.com delivered a trailing four-quarter earnings surprise of 10.4%, on average. The stock has rallied 16.7% in the past six months.
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