We could not find any results for:
Make sure your spelling is correct or try broadening your search.
Share Name | Share Symbol | Market | Type |
---|---|---|---|
Axon Enterprise Inc | NASDAQ:AAXN | NASDAQ | Common Stock |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
0.00 | 0.00% | 174.54 | 172.03 | 175.00 | 0 | 01:00:00 |
SCOTTSDALE, Ariz., May 7, 2020 /PRNewswire/ -- Axon (Nasdaq: AAXN), the global leader in connected public safety technologies, today released the following quarterly update letter to shareholders.
Dear Shareholders,
The first several months of 2020 are proving that Axon is resilient. You can see this in our adaptability to change, in the solutions-oriented culture embodied by our dedicated employees, and in our financial position.
For more than 25 years, Axon has been dedicated to serving those who protect and serve. Now, as always, our public safety customers are on the front lines of protecting the public, and sadly, too many of them have lost their lives to COVID-19. Axon mourns for fallen officers and their families, and we have pivoted to dedicate a portion of our supply chain to source critical safety equipment such as masks, gloves and hand sanitizer for first responders.
We continue to ship our hardware products at volume. Axon is viewed as "mission critical" under Department of Homeland Security guidelines and we hear this in feedback from our customers. We are focused on keeping our manufacturing lines open and our employees and customers safe.
Our cloud-based software has proven more useful than ever in supporting public safety and promoting social distancing. In March, we began providing global access to the full feature set of Axon Citizen, free of cost this year, to every agency that is not already using it. Axon Citizen enables virtual evidence collection, eliminating the need for officers to have to collect digital files in person and reducing the need for community members to visit a station.
Axon's core business remains robust and healthy, as seen in our Q1 2020 results, with revenue up 27% year over year. Particularly noteworthy was international revenue growth of 38%, driven by strong sales in the UK, Australia and Canada and sales to new, untapped international markets in Asia and Latin America — the direct result of our targeted investments in sales channel expansion. We discuss current market trends in our Outlook section.
We have a big mission to fulfill, which supports our robust long-term revenue growth and profitability goals. Axon is on track to complete record hiring through the first six months of this year, and we continue to attract bar-raising technology talent from the world's other top innovators.
Our strategic priorities in 2020 are to continue to execute in our core market, while accelerating our path-to-market in new product categories such as productivity (Records) and communications (Dispatch), and expanding to new customer categories, such as corrections, U.S. federal agencies and new international markets.
Axon's response to COVID-19:
We have been clear-eyed about the challenges surrounding COVID-19 and we aspire to lead from the front. We certainly do not celebrate difficult times, but we do see them as challenges that can bring out the greatness in people and companies. We believe Axon will emerge from this crisis even stronger.
Customer support: We are supporting our customers through a period of upheaval, doing our best to be a stable and reliable partner in this storm. Initiatives include:
Employee safety & manufacturing: Axon takes health and safety seriously, and our entire mission is to protect life. Just days after our last quarterly update, we curbed all non-essential employee travel and then quickly moved to support our information workers to do their jobs from home.
Our customers are counting on us to deliver TASER 7 and Axon body cameras. We are proud to be able to ensure that first responders have the tools they need to keep society safe and orderly. Early on in the US outbreak, Axon management was in discussions with local authorities and our Board, particularly Dr. Richard Carmona, the former US Surgeon General, and determined that the best course of action was to keep our critical manufacturing lines open to satisfy customer demand.
We've also taken steps to mitigate contamination risk in our facilities. This includes staggering work schedules, proactively sending high-risk groups home with pay, providing access to a registered nurse on site and increasing our cleaning standards to a level that exceeds CDC guidance.
Supply chain: We have adapted well to ongoing challenges. In 2019, we took action to diversify our supply chain and global manufacturing footprint. Those initiatives positioned us well to handle COVID-19, enabling us to produce and ship our critical core products with little to no interruption. While we feel confident in our preparations, there are still many unforeseen challenges that lay ahead. We continue to manage through supply chain disruptions, finding alternate sources when available or working with foreign regulators to ensure that our suppliers can provide parts. We elevated our inventory build in Q1 2020 and are continuing to do so over the course of 2020, which is a proactive approach to building safety stock in an effort to minimize shipping disruptions. We are committed to working through challenges as they arise to support our customers and deliver mission critical equipment.
Shareholder engagement: We have pivoted our shareholder engagement to a virtual format. Our annual meeting, scheduled for May 29, will be held online at www.virtualshareholdermeeting.com/AAXN2020, and we will be participating in several upcoming investor conferences utilizing video conferencing. All investor materials and events are available at investor.axon.com.
Progress on our core initiatives:
Summary of Q1 2020 results:
Financial commentary by segment:
TASER:
THREE MONTHS ENDED | CHANGE | |||||||||||||||||
31 MAR 2020 | 31 DEC 2019 | 31 MAR 2019 | QoQ | YoY | ||||||||||||||
(in thousands) | ||||||||||||||||||
Net sales | $ | 75,895 | $ | 83,955 | $ | 65,391 | (9.6) | % | 16.1 | % | ||||||||
Gross margin | 60.1 | % | 60.5 | % | 64.4 | % | (40) | bp | (430) | bp |
Software & Sensors:
THREE MONTHS ENDED | CHANGE | |||||||||||||||||
31 MAR 2020 | 31 DEC 2019 | 31 MAR 2019 | QoQ | YoY | ||||||||||||||
(in thousands) | ||||||||||||||||||
Axon Cloud net sales | $ | 39,154 | $ | 36,805 | $ | 27,631 | 6.4 | % | 41.7 | % | ||||||||
Axon Cloud gross margin | 75.3 | % | 76.1 | % | 73.6 | % | (80) | bp | 170 | bp | ||||||||
Sensors and Other net sales | $ | 32,113 | $ | 51,091 | $ | 22,788 | (37.1) | % | 40.9 | % | ||||||||
Sensors and Other gross margin | 42.0 | % | 27.0 | % | 28.4 | % | 1,500 | bp | 1,360 | bp |
Forward-Looking Performance Indicators:
31 MAR 2020 | 31 DEC 2019 | 30 SEP 2019 | 30 JUN 2019 | 31 MAR 2019 | ||||||||||||||||
($in thousands) | ||||||||||||||||||||
Annual recurring revenue (1) | $ | 173,919 | $ | 161,277 | $ | 141,540 | $ | 129,452 | $ | 122,276 | ||||||||||
Total company future contracted revenue | $ | 1,274,000 | $ | 1,230,000 | $ | 1,130,000 | $ | 1,050,000 | $ | 930,000 | ||||||||||
Percentage of TASER devices sold on a recurring payment plan | 43 | % | 58 | % | 55 | % | 60 | % | 42 | % |
____________________________ | |
(1) | Monthly recurring license, integration, warranty, and storage revenue annualized. |
Current market trends and outlook:
The following forward-looking statements reflect Axon's expectations as of May 7, 2020, and are subject to substantial uncertainty due to the COVID-19 pandemic.
What we're seeing in the market: To date, we are seeing mixed changes to buying habits among major US city police departments — some departments are continuing to place large orders for Axon products, and communicating gratitude that we are shipping mission critical equipment. We are seeing some agencies move to standard issue on Axon devices, to reduce sharing among officers, which has boosted orders.
A small number of agency customers have delayed their body camera programs, or postponed their subscription upgrades until unspecified later dates. Thus far, the impact of these COVID-19-related order delays to our full-year projections have been more than offset by a stronger-than-expected Q1 2020, better-than-expected international TASER orders realized through May 2020, and a strengthening Federal pipeline.
Through May, Axon has been executing upon orders from countries with which Axon has not historically done business, and this widening customer base is providing new revenue opportunities. So far in 2020, Axon has received body camera and TASER orders from Latin America, Asia, Southeast Asia, and South Asia — all representing new country markets — and we are also seeing stronger-than-average order activity in the UK.
We have also been encouraged by the speed with which the federal government has provided financial support to public safety. It is still early in the federal response, and the 2020 CARES Act contains $850 million in grants to state and local law enforcement, through the Edward Byrne Memorial Justice Assistance Grant (JAG), which is already more proactive than what we saw in the global economic recession of 2008-2009, as the first JAG grant then didn't occur until 2009. In addition, the early phase COVID-19 stimulus packages included $150 million for federal law enforcement.
Withdrawing formal guidance: Given the number of factors outside of Axon's control, we are withdrawing our previously provided formal full year guidance of $100 million to $105 million in Adjusted EBITDA on revenue of $615 million to $625 million, as we closely monitor municipal budgets and their potential impact on customer procurement cycles, which could materially alter our pipeline. While municipal government budget appropriations have not been a historical challenge for Axon, the severity of the economic slowdown related to COVID-19 increases appropriations risk.
Internal estimates & visibility: At this time, our best estimate for our 2020 performance remains in line with our previously issued guidance, but there is enough uncertainty in how the current crisis will affect our customers that we don't feel that our internal estimates should be considered formal guidance.
Axon remains confident in its long-term, multi-year outlook, and we firmly believe we will emerge from the COVID-19 crisis even stronger. Our confidence is supported by our strong Q1 2020 performance and the state of our current pipeline, which remains robust and is more geographically diverse than ever. While our contracts are subject to appropriations risk, at this point in time, the revenue realized in Q1 2020 plus the recurring revenue under contract for the remaining three quarters gives Axon visibility into approximately 50% of the midpoint of the previously issued full-year revenue guidance range.
Axon is proud to be taking care of our customers, our employees, and our societal stakeholders. We feel confident we will one day look back at 2020 as a pivotal year where we not only rose to the challenge, but we accelerated progress and created new opportunities. More importantly, we extended a hand to help our customers and their communities when it mattered.
Signed,
Rick Smith, CEO
Luke Larson, President
Jawad Ahsan, CFO
Quarterly conference call and Webcast
We will host our Q1 2020 earnings conference call on May 7 at 2 p.m. PT / 5 p.m. ET.
The webcast will be available via a link on Axon's investor relations website at https://investor.axon.com (https://investor.axon.com/), or can be accessed directly via https://axon.zoom.us/j/92548816017.
Statistical Definitions
Dollar-based net revenue retention is an important metric to measure our ability to retain and expand our relationships with existing customers. We calculate it as the software and camera warranty subscription and support revenue from a base set of agency customers from which we generated Axon Cloud subscription revenue in the last month of a quarter divided by the software and camera warranty subscription and support revenue from the year-ago month of that same customer base. This calculation includes high-margin warranty but purposely excludes the lower-margin hardware subscription contingent of the customer contracts, as it is meant to be a SaaS metric that we use to monitor the health of the recurring revenue business we are building. This calculation also excludes the implied monthly revenue contribution of customers that were added since the year-ago quarter, and therefore excludes the benefit of new customer acquisition. The metric includes customers, if any, that terminated during the annual period, and therefore, this metric is inclusive of customer churn. This metric is downwardly adjusted to account for the effect of phased deployments -- meaning that for the year-ago period, we consider the total contractually obligated implied monthly revenue amount, rather than monthly revenue amounts that might have been in actuality smaller on a GAAP basis due to the customer not having yet fully deployed their Axon solution.
For more information relative to our revenue recognition policies, please reference our SEC filings.
Non-GAAP Measures
To supplement the Company's financial results presented in accordance with GAAP, we present the non-GAAP financial measures of EBITDA, Adjusted EBITDA, Non-GAAP Net Income, Non-GAAP Diluted Earnings Per Share and Free Cash Flow. The Company's management uses these non-GAAP financial measures in evaluating the Company's performance in comparison to prior periods. We believe that both management and investors benefit from referring to these non-GAAP financial measures in assessing its performance, and when planning and forecasting our future periods. A reconciliation of GAAP to the non-GAAP financial measures is presented herein.
Caution on Use of Non-GAAP Measures
Although these non-GAAP financial measures are not consistent with GAAP, management believes investors will benefit by referring to these non-GAAP financial measures when assessing the Company's operating results, as well as when forecasting and analyzing future periods. However, management recognizes that:
Further, these non-GAAP financial measures may be unique to the Company, as they may be different from similarly titled non-GAAP financial measures used by other companies. As such, this presentation of non-GAAP financial measures may not enhance the comparability of the Company's results to the results of other companies.
About Axon
Axon is a mission-driven company whose overarching goal is to protect life. Our vision is a world where bullets are obsolete, where social conflict is dramatically reduced, and where everyone has access to a fair and effective justice system. Axon is also a leading provider of body cameras for US law enforcement, providing more transparency and accountability to communities than ever before.
You may learn about our Environmental, Social, and Governance (ESG) and Corporate Social Responsibility (CSR) efforts by reading our ESG disclosure at investor.axon.com.
We work hard for those who put themselves in harm's way for all of us. More than 232,000 lives and countless dollars have been saved with the Axon network of devices, apps and people. Learn more at www.axon.com or by calling (800) 978-2737.
Facebook is a trademark of Facebook, Inc.; LTE is a trademark of the European Telecommunications Standards Institute; Twitter is a trademark of Twitter, Inc. and Zoom is a trademark of Zoom Video Communications, Inc. Axon, Axon Aware, Axon Accelerate, Axon Evidence, Axon Records, Axon Fleet, TASER, TASER 7 and the Delta Logo are trademarks of Axon Enterprise, Inc., some of which are registered in the US and other countries. For more information, visit www.axon.com/legal. All rights reserved.
Follow Axon here:
Forward-looking statements
These forward-looking statements include, without limitation, statements regarding: the impact of the COVID-19 pandemic; proposed products and services and related development efforts and activities; expectations about the market for our current and future products and services; the impact of pending litigation; our outlook for 2020 with respect to revenue, legal expenses relating to the FTC litigation, stock compensation expense, and income tax rate; trends relating to subscription plan programs and revenues; our anticipation that contracts with governmental customers will be fulfilled; expected trends, including the benefits of, research and development investments; the sufficiency of our liquidity and financial resources; that we may repurchase our common stock; expectations about customer behavior; the impact on our investment portfolio of changes in interest rates; trends in the percentage of our revenues denominated in foreign currencies; our potential use of foreign currency forward and option contracts; statements concerning projections, predictions, expectations, estimates or forecasts as to our business, financial and operational results and future economic performance; statements of management's strategies, goals and objectives and other similar expressions; as well as the ultimate resolution of financial statement items requiring critical accounting estimates, including those set forth in our Form 10‑K for the year ended December 31, 2019. Such statements give our current expectations or forecasts of future events; they do not relate strictly to historical or current facts. Words such as "may," "will," "should," "could," "would," "predict," "potential," "continue," "expect," "anticipate," "future," "intend," "plan," "believe," "estimate," and similar expressions, as well as statements in future tense, identify forward-looking statements. However, not all forward-looking statements contain these identifying words.
We cannot guarantee that any forward-looking statement will be realized, although we believe we have been prudent in our plans and assumptions. Achievement of future results is subject to risks, uncertainties and potentially inaccurate assumptions. The following important factors could cause actual results to differ materially from those in the forward-looking statements: the potential global impacts of the COVID-19 pandemic; our exposure to cancellations of government contracts due to appropriation clauses, exercise of a cancellation clause, or non-exercise of contractually optional periods; our ability to design, introduce and sell new products or features; our ability to defend against litigation and protect our intellectual property, and the resulting costs of this activity; our ability to manage our supply chain and avoid production delays, shortages, and impacts to expected gross margins; the impact of stock compensation expense, impairment expense, and income tax expense on our financial results; customer purchase behavior, including adoption of our software as a service delivery model; negative media publicity regarding our products; the impact of product mix on projected gross margins; defects in our products; changes in the costs of product components and labor; loss of customer data, a breach of security, or an extended outage, including our reliance on third party cloud-based storage providers; exposure to international operational risks; delayed cash collections and possible credit losses due to our subscription model; changes in government regulations in the U.S. and in foreign markets, especially related to the classification of our product by the United States Bureau of Alcohol, Tobacco, Firearms and Explosives and to evolving regulations surrounding privacy and data protection; our ability to integrate acquired businesses; our ability to attract and retain key personnel; and counter-party risks relating to cash balances held in excess of FDIC insurance limits. Many events beyond our control may determine whether results we anticipate will be achieved. Many events beyond our control may determine whether results we anticipate will be achieved. Should known or unknown risks or uncertainties materialize, or should underlying assumptions prove inaccurate, actual results could differ materially from past results and those anticipated, estimated or projected. You should bear this in mind as you consider forward-looking statements. Our Annual Report on Form 10-K lists various important factors that could cause actual results to differ materially from expected and historical results. These factors are intended as cautionary statements for investors within the meaning of Section 21E of the Exchange Act and Section 27A of the Securities Act. Readers can find them under the heading "Risk Factors" in the Annual Report on Form 10-K and in the Quarterly Report on Form 10-Q, and investors should refer to them. You should understand that it is not possible to predict or identify all such factors. Consequently, you should not consider any such list to be a complete set of all potential risks or uncertainties.
Except as required by law, we undertake no obligation to publicly update forward-looking statements, whether as a result of new information, future events or otherwise. You are advised, however, to consult any further disclosures we make on related subjects in our Form 10-Q, 8-K and 10-K reports to the SEC.
Update on Legal Matters:
Digital Ally v. Axon
On April 22, 2020, the Federal Circuit Court of Appeals (No. 19-2065) affirmed the Kansas district court's non-infringement ruling and entered judgment on Digital's appeal in favor of Axon. This ruling effectively ends this litigation filed in January 2016. Digital had claimed that Axon's Signal Technology infringed its '452 Patent. The court of appeals ruling may be found at https://www.axon.com/legal.
Axon v. FTC
Axon continues to both vigorously prosecute its Federal court case against the FTC and defend the FTC's separate administrative action against the company. Presently, the FTC's administrative action has been stayed until June 3, 2020, due to the COVID-19 pandemic, and the hearing has been rescheduled to September 9, 2020. Separately, Axon's case against the FTC was dismissed on April 8, 2020, without prejudice, for lack of jurisdiction, holding that Axon must first bring its constitutional claims through the FTC's administrative process. Axon has appealed that ruling to the Ninth Circuit Court of Appeals (No. 20-15662), which has granted expedited consideration and set oral argument for July 17, 2020. A copy of Axon's appellate brief can be found on Axon's FTC Investor Briefing page at https://www.axon.com/ftc. Please visit https://investor.axon.com, https://www.axon.com/press, www.twitter.com/axon_us and https://www.facebook.com/Axon.ProtectLife/ where Axon discloses information about the company, its financial information, and its business.
For investor relations information please contact Andrea James via email at IR@axon.com.
AXON ENTERPRISE, INC. CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) (in thousands, except per share data) | |||||||||
THREE MONTHS ENDED | |||||||||
31 MAR 2020 | 31 DEC 2019 | 31 MAR 2019 | |||||||
Net sales from products | $ | 107,288 | $ | 134,497 | $ | 88,089 | |||
Net sales from services | 39,874 | 37,354 | 27,721 | ||||||
Net sales | 147,162 | 171,851 | 115,810 | ||||||
Cost of product sales | 48,884 | 70,418 | 39,600 | ||||||
Cost of service sales | 9,670 | 8,793 | 7,293 | ||||||
Cost of sales | 58,554 | 79,211 | 46,893 | ||||||
Gross margin | 88,608 | 92,640 | 68,917 | ||||||
Operating expenses: | |||||||||
Sales, general and administrative | 63,027 | 78,281 | 42,892 | ||||||
Research and development | 26,381 | 28,745 | 23,354 | ||||||
Total operating expenses | 89,408 | 107,026 | 66,246 | ||||||
Income (loss) from operations | (800) | (14,386) | 2,671 | ||||||
Interest and other income, net | 941 | 2,486 | 2,313 | ||||||
Income (loss) before provision for income taxes | 141 | (11,900) | 4,984 | ||||||
Provision for (benefit from) income taxes | (3,933) | 479 | (1,435) | ||||||
Net income (loss) | $ | 4,074 | $ | (12,379) | $ | 6,419 | |||
Net income (loss) per common and common equivalent shares: | |||||||||
Basic | $ | 0.07 | $ | (0.21) | $ | 0.11 | |||
Diluted | $ | 0.07 | $ | (0.21) | $ | 0.11 | |||
Weighted average number of common and common equivalent shares outstanding: | |||||||||
Basic | 59,609 | 59,374 | 58,914 | ||||||
Diluted | 60,394 | 60,257 | 59,751 |
AXON ENTERPRISE, INC. SEGMENT REPORTING (Unaudited) (dollars in thousands) | ||||||||||||||||||||||||||||||||||||
THREE MONTHS ENDED | THREE MONTHS ENDED | THREE MONTHS ENDED | ||||||||||||||||||||||||||||||||||
31 MAR 2020 | 31 DEC 2019 | 31 MAR 2019 | ||||||||||||||||||||||||||||||||||
Software | Software | Software | ||||||||||||||||||||||||||||||||||
and | and | and | ||||||||||||||||||||||||||||||||||
TASER | Sensors | Total | TASER | Sensors | Total | TASER | Sensors | Total | ||||||||||||||||||||||||||||
Net sales from products (1) | $ | 75,175 | $ | 32,113 | $ | 107,288 | $ | 83,406 | $ | 51,091 | $ | 134,497 | $ | 65,301 | $ | 22,788 | $ | 88,089 | ||||||||||||||||||
Net sales from services (2) | 720 | 39,154 | 39,874 | 549 | 36,805 | 37,354 | 90 | 27,631 | 27,721 | |||||||||||||||||||||||||||
Net sales | 75,895 | 71,267 | 147,162 | 83,955 | 87,896 | 171,851 | 65,391 | 50,419 | 115,810 | |||||||||||||||||||||||||||
Cost of product sales | 30,248 | 18,636 | 48,884 | 33,144 | 37,274 | 70,418 | 23,278 | 16,322 | 39,600 | |||||||||||||||||||||||||||
Cost of service sales | — | 9,670 | 9,670 | — | 8,793 | 8,793 | — | 7,293 | 7,293 | |||||||||||||||||||||||||||
Cost of sales | 30,248 | 28,306 | 58,554 | 33,144 | 46,067 | 79,211 | 23,278 | 23,615 | 46,893 | |||||||||||||||||||||||||||
Gross margin | 45,647 | 42,961 | 88,608 | 50,811 | 41,829 | 92,640 | 42,113 | 26,804 | 68,917 | |||||||||||||||||||||||||||
Gross margin % | 60.1 | % | 60.3 | % | 60.2 | % | 60.5 | % | 47.6 | % | 53.9 | % | 64.4 | % | 53.2 | % | 59.5 | % | ||||||||||||||||||
Research and development | 3,032 | 23,349 | 26,381 | 4,185 | 24,560 | 28,745 | 3,712 | 19,642 | 23,354 |
_______________________ | |
(1) | Software and Sensors "products" revenue consists of sensors, including on-officer body cameras, Axon Fleet cameras, other hardware sensors, warranties on sensors, and other products, and is sometimes referred to as Sensors and Other revenue. |
(2) | Software and Sensors "services" revenue comprises sales related to the Axon Cloud, which includes Axon Evidence, cloud-based evidence management software revenue, other recurring cloud-hosted software revenue and related professional services, and is sometimes referred to as Axon Cloud revenue. |
AXON ENTERPRISE, INC. UNIT SALES STATISTICS (Unaudited) Units in whole numbers | |||||||||
THREE MONTHS ENDED | |||||||||
31 MAR | 31 MAR | Unit | Percent | ||||||
2020 | 2019 | Change | Change | ||||||
TASER 7 | 11,430 | 8,835 | 2,595 | 29.4 | % | ||||
TASER X26P | 11,003 | 14,985 | (3,982) | (26.6) | |||||
TASER X2 | 10,478 | 9,861 | 617 | 6.3 | |||||
TASER Pulse and Bolt | 3,261 | 1,253 | 2,008 | 160.3 | |||||
Cartridges | 873,364 | 616,517 | 256,847 | 41.7 | |||||
Axon Body | 39,864 | 25,848 | 14,016 | 54.2 | |||||
Axon Flex | 3,074 | 3,591 | (517) | (14.4) | |||||
Axon Fleet | 2,676 | 1,735 | 941 | 54.2 | |||||
Axon Dock | 5,297 | 4,994 | 303 | 6.1 | |||||
TASER Cam | 1,514 | 1,741 | (227) | (13.0) |
AXON ENTERPRISE, INC. RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES (Unaudited) Dollars in thousands | ||||||||||
THREE MONTHS ENDED | ||||||||||
31 MAR 2020 | 31 DEC 2019 | 31 MAR 2019 | ||||||||
EBITDA and Adjusted EBITDA: | ||||||||||
Net income (loss) | $ | 4,074 | $ | (12,379) | $ | 6,419 | ||||
Depreciation and amortization | 2,881 | 3,165 | 2,800 | |||||||
Interest expense | 7 | 19 | 6 | |||||||
Investment interest income | (693) | (1,760) | (2,003) | |||||||
Provision for (benefit from) income taxes | (3,933) | 479 | (1,435) | |||||||
EBITDA | $ | 2,336 | $ | (10,476) | $ | 5,787 | ||||
Adjustments: | ||||||||||
Stock-based compensation expense | $ | 20,195 | $ | 48,300 | $ | 7,905 | ||||
Transaction costs related to investment in unconsolidated affiliate | 833 | — | — | |||||||
Loss on disposal and abandonment of intangible assets | 13 | 16 | 18 | |||||||
Loss on disposal and impairment of property and equipment, net | 517 | 134 | 242 | |||||||
Costs related to FTC litigation | 6,135 | 240 | — | |||||||
Adjusted EBITDA | $ | 30,029 | $ | 38,214 | $ | 13,952 | ||||
Net income (loss) as a percentage of net sales | 2.8 | % | (7.2) | % | 5.5 | % | ||||
Adjusted EBITDA as a percentage of net sales | 20.4 | % | 22.2 | % | 12.0 | % | ||||
Stock-based compensation expense: | ||||||||||
Cost of product and service sales | $ | 590 | $ | 790 | $ | 226 | ||||
Sales, general and administrative | 14,970 | 40,212 | 4,681 | |||||||
Research and development | 4,635 | 7,298 | 2,998 | |||||||
Total | $ | 20,195 | $ | 48,300 | $ | 7,905 |
AXON ENTERPRISE, INC. RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES - continued (Unaudited) Dollars in thousands | |||||||||
THREE MONTHS ENDED | |||||||||
31 MAR 2020 | 31 DEC 2019 | 31 MAR 2019 | |||||||
Non-GAAP net income: | |||||||||
GAAP net income (loss) | $ | 4,074 | $ | (12,379) | $ | 6,419 | |||
Non-GAAP adjustments: | |||||||||
Stock-based compensation expense | 20,195 | 48,300 | 7,905 | ||||||
Loss on disposal and abandonment of intangible assets | 13 | 16 | 18 | ||||||
Loss on disposal and impairment of property and equipment, net | 517 | 134 | 242 | ||||||
Transaction costs related to investment in unconsolidated affiliate | 833 | — | — | ||||||
Costs related to FTC litigation | 6,135 | 240 | — | ||||||
Income tax effects | (7,837) | (11,863) | (2,016) | ||||||
Non-GAAP net income | $ | 23,930 | $ | 24,448 | $ | 12,568 | |||
THREE MONTHS ENDED | |||||||||
31 MAR 2020 | 31 DEC 2019 | 31 MAR 2019 | |||||||
Non-GAAP diluted earnings per share: | |||||||||
GAAP diluted earnings per share | $ | 0.07 | $ | (0.21) | $ | 0.11 | |||
Non-GAAP adjustments: | |||||||||
Stock-based compensation expense | 0.33 | 0.80 | 0.13 | ||||||
Loss on disposal and abandonment of intangible assets | 0.00 | 0.00 | 0.00 | ||||||
Loss on disposal and impairment of property and equipment, net | 0.01 | 0.00 | 0.00 | ||||||
Transaction costs related to investment in unconsolidated affiliate | 0.01 | - | - | ||||||
Costs related to FTC litigation | 0.10 | 0.00 | - | ||||||
Income tax effects | (0.13) | (0.20) | (0.03) | ||||||
Non-GAAP diluted earnings per share (1) | $ | 0.40 | $ | 0.40 | $ | 0.21 | |||
Weighted average number of diluted common and common equivalent shares outstanding (in thousands) | 60,394 | 60,257 | 59,751 |
_____________________________________ | |
(1) | The per share calculations for GAAP net income, Non-GAAP adjustments and Non-GAAP diluted earnings per share are each computed independently. Per share amounts may not sum due to rounding. |
AXON ENTERPRISE, INC. CONSOLIDATED BALANCE SHEETS (in thousands) | ||||||
31 MAR 2020 | 31 DEC 2019 | |||||
(Unaudited) | ||||||
ASSETS | ||||||
Current Assets: | ||||||
Cash and cash equivalents | $ | 156,540 | $ | 172,250 | ||
Short-term investments | 188,673 | 178,534 | ||||
Accounts and notes receivable, net | 147,945 | 146,878 | ||||
Contract assets, net | 43,959 | 38,102 | ||||
Inventory, net | 46,922 | 38,845 | ||||
Prepaid expenses and other current assets | 34,702 | 34,866 | ||||
Total current assets | 618,741 | 609,475 | ||||
Property and equipment, net | 43,065 | 43,770 | ||||
Deferred tax assets, net | 29,433 | 27,688 | ||||
Intangible assets, net | 11,929 | 12,771 | ||||
Goodwill | 24,752 | 25,013 | ||||
Long-term investments | 50,225 | 45,499 | ||||
Long-term notes receivable, net of current portion | 27,556 | 31,598 | ||||
Long-term contract assets, net | 12,293 | 9,644 | ||||
Other assets | 59,457 | 40,181 | ||||
Total assets | $ | 877,451 | $ | 845,639 | ||
LIABILITIES AND STOCKHOLDERS' EQUITY | ||||||
Current Liabilities: | ||||||
Accounts payable | 31,568 | 25,874 | ||||
Accrued liabilities | 36,404 | 45,001 | ||||
Current portion of deferred revenue | 119,827 | 117,864 | ||||
Customer deposits | 3,325 | 2,974 | ||||
Other current liabilities | 3,891 | 3,853 | ||||
Total current liabilities | 195,015 | 195,566 | ||||
Deferred revenue, net of current portion | 91,886 | 87,936 | ||||
Liability for unrecognized tax benefits | 4,173 | 3,832 | ||||
Long-term deferred compensation | 3,430 | 3,936 | ||||
Deferred tax liability | 342 | 354 | ||||
Other long-term liabilities | 23,015 | 10,520 | ||||
Total liabilities | 317,861 | 302,144 | ||||
Stockholders' Equity: | ||||||
Preferred stock | — | — | ||||
Common stock | 1 | 1 | ||||
Additional paid-in capital | 543,305 | 528,272 | ||||
Treasury stock | (155,947) | (155,947) | ||||
Retained earnings | 175,699 | 172,265 | ||||
Accumulated other comprehensive loss | (3,468) | (1,096) | ||||
Total stockholders' equity | 559,590 | 543,495 | ||||
Total liabilities and stockholders' equity | $ | 877,451 | $ | 845,639 |
AXON ENTERPRISE, INC. UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (in thousands) | |||||||||
THREE MONTHS ENDED | |||||||||
31 MAR 2020 | 31 DEC 2019 | 31 MAR 2019 | |||||||
Cash flows from operating activities: | |||||||||
Net income (loss) | $ | 4,074 | $ | (12,379) | $ | 6,419 | |||
Adjustments to reconcile net income to net cash provided by operating activities: | |||||||||
Depreciation and amortization | 2,881 | 3,165 | 2,800 | ||||||
Loss on disposal and abandonment of intangible assets | 13 | 16 | 18 | ||||||
Loss (gain) on disposal and impairment of property and equipment, net | 517 | 134 | 242 | ||||||
Stock-based compensation | 20,195 | 48,300 | 7,905 | ||||||
Deferred income taxes | (1,548) | (4,041) | 577 | ||||||
Unrecognized tax benefits | 341 | 389 | 307 | ||||||
Other noncash, net | 1,156 | 1,005 | 896 | ||||||
Provision for expected credit losses | 902 | — | — | ||||||
Change in assets and liabilities: | |||||||||
Accounts and notes receivable and contract assets | (9,700) | (8,333) | (21,994) | ||||||
Inventory | (8,630) | 1,399 | (3,936) | ||||||
Prepaid expenses and other assets | 2,277 | 2,122 | (3,152) | ||||||
Accounts payable, accrued liabilities and other liabilities | (3,562) | 18,495 | (7,284) | ||||||
Deferred revenue | 4,499 | (4,463) | 3,232 | ||||||
Net cash provided by (used in) operating activities | 13,415 | 45,809 | (13,970) | ||||||
Cash flows from investing activities: | |||||||||
Purchases of investments | (99,512) | (111,784) | (105,322) | ||||||
Proceeds from call / maturity of investments | 84,315 | 37,876 | — | ||||||
Purchases of property and equipment | (2,209) | (3,828) | (5,271) | ||||||
Purchases of intangible assets | (45) | (76) | (162) | ||||||
Proceeds of disposal from property and equipment | 78 | — | — | ||||||
Investment in unconsolidated affiliate | (4,700) | — | — | ||||||
Net cash used in investing activities | (22,073) | (77,812) | (110,755) | ||||||
Cash flows from financing activities: | |||||||||
Proceeds from options exercised | 28 | 8 | 100 | ||||||
Income and payroll tax payments for net-settled stock awards | (5,190) | (783) | (1,259) | ||||||
Net cash used in financing activities | (5,162) | (775) | (1,159) | ||||||
Effect of exchange rate changes on cash and cash equivalents | (1,890) | 1,007 | 67 | ||||||
Net decrease in cash and cash equivalents and restricted cash | (15,710) | (31,771) | (125,817) | ||||||
Cash and cash equivalents, beginning of period | 172,355 | 204,126 | 351,027 | ||||||
Cash and cash equivalents, end of period | $ | 156,645 | $ | 172,355 | $ | 225,210 |
AXON ENTERPRISE, INC. SELECTED CASH FLOW INFORMATION (Unaudited) (in thousands) | |||||||||
THREE MONTHS ENDED | |||||||||
31 MAR 2020 | 31 DEC 2019 | 31 MAR 2019 | |||||||
Net cash provided by (used in) operating activities | $ | 13,415 | $ | 45,809 | $ | (13,970) | |||
Purchases of property and equipment | (2,209) | (3,828) | (5,271) | ||||||
Purchases of intangible assets | (45) | (76) | (162) | ||||||
Investment in unconsolidated affiliate | (4,700) | — | — | ||||||
Free cash flow, a non-GAAP measure | $ | 6,461 | $ | 41,905 | $ | (19,403) |
AXON ENTERPRISE, INC. SUPPLEMENTAL TABLES (in thousands) | ||||||
31 MAR 2020 | 31 DEC 2019 | |||||
(Unaudited) | ||||||
Cash and cash equivalents | $ | 156,540 | $ | 172,250 | ||
Short-term investments | 188,673 | 178,534 | ||||
Long-term investments | 50,225 | 45,499 | ||||
Investment payable | (13,451) | — | ||||
Total cash and cash equivalents and investments, net | $ | 381,987 | $ | 396,283 |
CONTACT:
Investor Relations
Axon Enterprise, Inc.
IR@axon.com
View original content to download multimedia:http://www.prnewswire.com/news-releases/axon-reports-strong-first-quarter-results-axon-dispatch-is-live-record-international-sales-pipeline-is-robust-301055245.html
SOURCE Axon
Copyright 2020 PR Newswire
1 Year Axon Enterprise Chart |
1 Month Axon Enterprise Chart |
It looks like you are not logged in. Click the button below to log in and keep track of your recent history.
Support: +44 (0) 203 8794 460 | support@advfn.com
By accessing the services available at ADVFN you are agreeing to be bound by ADVFN's Terms & Conditions