Guess which of these two TASER brands is growing faster? Image source: TASER International.
TASER International (TASR +2.48%) is more than just Taser stun guns, and has been for a while.
In fact, lately, TASER has been placing a lot of faith in the ability of its new family of Axon cameras to offset slower sales in its eponymous stun-gun market, both here in the U.S. and abroad. A few months ago we told you about TASER's venture north of the border to sell body cameras in Canada. Today, we're going to tell you a bit about its latest move to the south.
To Australia, to be precise.
TASER goes Down Under
Last week, TASER announced the sale of 720 Axon Body 2 cameras and 100 Axon Flex cameras to the Northern Territory Police in Australia.
Now, without context, that sounds like a pretty big deal. But here's the thing: At a list price of $399 for the Body 2, and $599 for the Flex, this is actually not that large of a contract for TASER -- less than $350,000 for the hardware, even before accounting for any volume discounts on the sale. Those hardly seem the kind of numbers you'd expect to drive TASER's stock price up 2.2% in the days following the sale's announcement. (TASER's shares have since suffered a setback.)
Nor is the Northern Territory deal even TASER's first foray Down Under. According to the company's website, TASER first penetrated the Australian market back in 2009, when the New South Wales Police placed an order for nearly 2,000 Taser stun guns with attached Taser Cam camcorders -- each of which probably cost on the order of twice what TASER now charges for its body cameras.
It was five years before TASER announced another big stun-gun sale in Australia -- 1,000 units, reported in 2014 -- and then two years more before the company began selling Axons in the country. That latter sale took place in July, when the company confirmed that the Queensland Police Service had become its inaugural Axon customer in Australia, and would deploy 2,700 Axon Body cameras among its officers.
Now, the Northern Territory Police has become customer No. 2.
What does it mean for TASER?
Data from S&P Global Market Intelligence confirm that international sales remain just a small sliver of TASER's overall business, accounting for fewer than one revenue dollar in five. TASER's international business is so small, in fact, that even last week's sale of less than $350,000 worth of cameras will likely amount to almost one full percentage point of the segment's overall annual revenue of $36.1 million.
Despite the small sales base that TASER is growing from internationally, though, growth rates abroad continue to lag those here in the U.S. Last year, for example, TASER sales in the U.S. surged 22% to $161.8 million. In contrast, international sales grew just half as fast, up less than 12% to $36.1 million -- and quarterly sales were actually down 19% in the second quarter.
In that context, while the dollar value of TASER's Australian sale may be small, the good news is that it's happening where TASER most needs to show investors that it's able to continue growing: the international market.
