Computed from published fixed rules, not a model's judgement — though one input, the count of high-severity risks, comes from the AI analysis below.
Not investment advice and not a price target: it scores the quarter's fundamentals, not the stock. Full methodology →
AI Takeaway
Axon's second quarter of fiscal 2026 was defined by a top-line acceleration, with revenue growth reaching its highest rate in over two years. The surge was driven by robust demand for TASER 10 devices and cartridges, as well as a more than doubling of platform solutions revenue from counter-drone equipment. Despite the strong operational performance, net income declined year-over-year as the prior-year quarter benefited from a large one-time tax provision release. The company also received a $47.4 million tariff refund that lifted hardware margins.
Revenue
$904.39M
+35.28% YoY
EPS (Diluted)
$0.36
-18.18% YoY
Gross Margin
60.4%
+0.0 pts YoY
Operating Income
$46.78M
+4615.25% YoY
Source: SEC XBRL
Axon Enterprise (AXON) reported Q2 FY2026 revenue of $904.39M, up 35.3% year over year. Operating margin was 5.2%, against -0.2% a year earlier. AXON's fiscal Q2 FY2026 corresponds to calendar Q2 2026.
Last 4 quarters: 1 beat
| Quarter | Actual EPS (USD) | Consensus (USD) | Result |
|---|---|---|---|
| Jun 2026This filing | 1.88 | 1.89 | Miss -0.3% |
| Mar 2026 | 1.61 | 1.63 | Miss -1.3% |
| Dec 2025 | 2.15 | 1.64 | Beat +31.3% |
| Sep 2025 | 1.17 | 1.55 | Miss -24.5% |
Adjusted (non-GAAP) EPS of $1.88 versus the $1.89 analyst consensus — a -0.3% miss for Jun 2026. Analyst consensus is quoted on the adjusted (non-GAAP) basis the street uses. GAAP diluted EPS for this quarter was $0.36.
2 reported segments · SEC XBRL
Segment revenue totals $904.39M, which is the $904.39M of consolidated revenue on the income statement.
Compiled by AI from 10-Q Item 2 of this filing
Following a Supreme Court ruling that IEEPA tariffs were unauthorized, Axon received $47.4 million in refunds during the quarter, of which $18.1 million had been previously expensed to cost of sales, directly lowering costs. The remaining majority was reclassified from inventory and property, reducing future expense.
Source: 10-Q Item 2 MD&A
Axon used $551.6 million in business combinations during the first half of fiscal 2026, substantially all related to the Carbyne acquisition, significantly impacting net cash used in investing activities.
Source: 10-Q Item 2 MD&A
SG&A and R&D expenses rose primarily due to increased headcount and investments in AI initiatives, including higher advisory, travel, and technology license costs. R&D spending in particular grew 28.4% year-over-year to $208.7 million, with AI-related engineering and licensing expenses up.
Source: 10-Q Item 2 MD&A
Axon raised $100.5 million in net cash proceeds from an at-the-market equity offering program during the period, bolstering liquidity despite a decline in cash reserves from acquisitions and investment purchases.
Source: 10-Q Item 2 MD&A
International revenue increased to 18% of total sales, driven by higher sales in the EMEA region, reflecting expanding global adoption of Axon's connected devices and software.
Source: 10-Q Item 2 MD&A
Compiled by AI from this SEC filing · 1 high, 4 medium, 0 low
A substantial portion of Axon's revenue comes from public sector customers, whose purchasing decisions are influenced by government budget cycles and policy shifts. Cuts in law enforcement funding could materially reduce demand for TASER devices and related services.
Source: 10-Q Income Statement (XBRL)
The $551.6 million Carbyne acquisition and other strategic investments expose Axon to integration challenges, potential goodwill impairment, and distraction of management, which could undermine expected synergies and financial performance.
Source: 10-Q Cash Flow Statement (XBRL)
Although Axon received a $47.4 million tariff refund in the quarter, future changes in trade policy or re-imposition of tariffs could increase costs for imported components, especially for counter-drone equipment, impacting margins as they scale.
Source: 10-Q Item 2 MD&A
Stock-based compensation remains a significant expense, totaling $144.3 million in Q2 FY2026, which depresses net income and dilutes shareholders. Continued heavy reliance on equity awards could pressure EPS growth if not managed.
Source: 10-Q Income Statement (XBRL)
Axon carries $1.73 billion in long-term senior notes, and interest expense increased to $28.1 million in Q2 FY2026 from $28.7 million a year ago. While currently manageable, higher interest rates or refinancing needs could strain cash flows.
Source: 10-Q Balance Sheet (XBRL)
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Revenue $M | 904.39 $M | 668.54 $M | +35.28% |
Cost of Revenue $M | 357.94 $M | 264.80 $M | +35.18% |
Gross Profit $M | 546.45 $M | 403.74 $M | +35.35% |
Operating Income $M | 46.78 $M | -1.04 $M | +4615.25% |
Net Income $M | 29.43 $M | 36.12 $M | -18.52% |
EPS (Basic) $ | 0.37 $ | 0.46 $ | -19.57% |
EPS (Diluted) $ | 0.36 $ | 0.44 $ | -18.18% |
R&D Expense $M | 208.69 $M | 162.57 $M | +28.37% |
SG&A Expense $M | 290.98 $M | 242.21 $M | +20.14% |
Answers draw on this SEC filing and the data on this page
Expected release date, analyst estimates & what to watch
Axon Enterprise delivered strong Q1 2026 revenue of $807.3M (+33.7% YoY) and net income of $169.3M (+92.4% YoY), though operating cash flow turned negative at -$31.5M and gross margin compressed slightly to 59.1%.
Axon Enterprise delivered 33.5% revenue growth to $2.78B in FY2025, but swung to an operating loss of $62.1M as R&D and SG&A spending surged 55% and 40% respectively, while net income fell 66.9% to $124.7M.
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