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Axon Enterprise Inc (AAXN +0.02%) continued to grow both its Taser and body camera businesses in the fourth quarter of 2017, continuing a year of momentum. As we head into 2018, new products like a camera for vehicles, a records management system, and a smart holster for weapons could drive even more growth.
Here's a look at the high-level numbers from Axon and some details on how each segment of the business is performing.
Image source: Axon Enterprise.
Metric | Q4 2017 | Q4 2016 | Year-Over-Year Change |
---|---|---|---|
Sales | $94.7 million | $82.1 million | 15.3% |
Net income | ($2.1 million) | $6.3 million | N/A |
Diluted EPS | ($0.04) | $0.12 | N/A |
Data source: Axon Enterprise Inc Q4 2017 earnings release.
Growth was strong once again, but the net loss was a surprise given management's focus on improving the bottom line. As we've seen all earnings season from other companies, one-time charges from the tax cuts passed in December had an adverse impact on the bottom line. Here's a more detailed breakdown of how the business did:
Growth has been the focus of Axon Enterprise's management for a few years now, but in 2018, we'll see a turn toward more of a bottom-line focus. And new products could help improve the bottom line, with management saying in the earnings release:
This year, we plan to introduce several new products and services and improve upon our existing suite of offerings -- which we believe will grow recurring cash flows and increase average revenue per user. We're also scaling up our offices across the world and cross-pollinating our internal groups to ensure we execute against one vision for Axon. In short, we are focused on disciplined execution and preparing for significant growth across the globe.
Finally, we are driving toward profitability in the Software & Sensors segment and remain committed to expanding total company operating margins.
If new products are successful, they could drive add-on sales as well as new customer sales, so investors should watch how quickly these products gain traction in the market.
Law enforcement continues to demand more less-lethal weapons, and Axon is filling the market need. But in the long term, it's body cameras that are going to drive the business, and the growing backlog combined with new products coming in 2018 should drive growth for the foreseeable future.