New York, February 25, 2026, 18:31 EST — Trading after the bell.
- Axon stock jumped as the company topped profit estimates and projected robust growth through 2026.
- Axon’s advance into AI tools kept the spotlight on bookings and recurring software revenue for investors.
- Next: executives hit the conference circuit, with more specifics on AI product launches expected.
Axon Enterprise surged 17.6% to finish Wednesday at $520.18, hitting a session high near $552 along the way. Post-close, shares slipped 0.2% to $519.
After the company’s quarterly update late Tuesday, investors got a closer look at demand for Tasers, body cameras, and subscription software. With the stock trading at a growth multiple, bookings and margins were the numbers under the microscope.
Axon told shareholders that revenue in 2025 jumped 33% to $2.8 billion, with bookings up even more—46% to $7.4 billion. Looking ahead, the company is predicting revenue will climb another 27% to 30% in 2026. Stock-based compensation is set to land somewhere between $590 million and $620 million, according to its letter. CEO Rick Smith emphasized that “nobody should be more aggressive or more thoughtful on AI than Axon,” and teased fresh capabilities set to be unveiled at Axon Week in April. SEC
Axon has been riding a wave of increased federal spending, much of it linked to immigration enforcement, along with more money flowing in from companies boosting executive security budgets, according to Reuters. On a call with analysts, President Joshua Isner described “a major opportunity across federal law enforcement,” pointing to interest in counter-UAS — or counter-drone — offerings. TD Cowen’s Andrew Sherman dubbed it “a critical quarter.” Northland Capital Markets’ Michael Latimore said Axon’s AI strengths, especially in turning sensor data into workflows, are standing out more. Shares now fetch about 57 times forward earnings, a steep premium compared to the sector’s median of about 26, Reuters noted. Reuters
Arizona-based Axon turned in adjusted earnings of $2.15 a share, with revenue landing at $796.7 million, easily beating the $1.60 on $755.2 million expected by analysts polled by LSEG, Reuters reported. Connected Devices revenue jumped 38% to roughly $454.2 million. Still, the unit’s adjusted gross margin slipped to 49.3% from 52.2%, pressured by tariffs and a less favorable product mix.
The company’s updated outlook and fresh long-term targets appeared in a shareholder letter attached to its Form 8-K filed with the U.S. Securities and Exchange Commission.
Axon is telling investors it expects a bigger slice of future growth to be driven by software subscriptions layered onto its cameras and weapons—think recurring revenue, plus new AI tools. The company’s up against Motorola Solutions and a host of smaller players in the public safety tech space, from hardware outfits to evidence-management specialists.
Still, government procurement cycles remain a key factor, and the company calls out contract cancellations, customer funding, and operational headaches like supply chain snags or data breaches as real risks. Misses on margin, particularly in hardware, get punished quickly by a market that’s built in growth expectations.
Next session, the key will be whether the rally keeps its grip above the post-earnings gap—and if that after-hours selling morphs into profit-taking. Options flows, and whatever analysts toss out in their notes, could whip things around after a move like this.
Axon heads to Bank of America’s Global Industrials Conference on March 19. Investors will be tuning in for updates on bookings momentum and specifics on how quickly its AI products are hitting the market.
