Summary
Axon Enterprise, Inc. (AXON), formerly known as TASER International, Inc., reported its financial results for the quarter ended June 30, 2011. The company experienced a net sales increase of 10.9% to $21.2 million compared to the same period in the prior year, driven by strong international sales and the launch of the TASER X2. Despite the revenue growth, AXON reported a net loss of $2.3 million for the quarter, an increase from the $1.4 million net loss in Q2 2010. This widened loss was primarily due to a significant litigation judgment expense of $3.3 million related to an adverse jury verdict in the Turner v. TASER International case, and a $1.4 million asset impairment charge for the Protector product line. The company's gross margin improved considerably, rising to 57.8% from 50.4% year-over-year, indicating better cost management and a favorable product mix. Operationally, AXON saw a decrease in SG&A expenses as a percentage of sales, reflecting cost-cutting measures. However, research and development expenses also saw a reduction. The company maintained a strong liquidity position with $38.5 million in cash, cash equivalents, and investments as of June 30, 2011. AXON also continued its share repurchase program, investing $12.5 million in the quarter, and announced an additional $20 million repurchase authorization, signaling confidence in its financial stability despite the current period's net loss.
Financial Highlights
47 data points| Revenue | $21.20M |
| Cost of Revenue | $8.96M |
| Gross Profit | $12.24M |
| R&D Expenses | $2.79M |
| SG&A Expenses | $9.07M |
| Operating Income | -$5.02M |
| Net Income | -$2.29M |
| EPS (Basic) | $-0.04 |
| EPS (Diluted) | $-0.04 |
| Shares Outstanding (Basic) | 60.61M |
| Shares Outstanding (Diluted) | 60.61M |
Key Highlights
- 1Net sales increased by 10.9% to $21.2 million for Q2 2011 compared to $19.1 million in Q2 2010.
- 2Gross margin improved significantly to 57.8% from 50.4% year-over-year, driven by favorable product mix and cost efficiencies.
- 3The company reported a net loss of $2.3 million for Q2 2011, an increase from the $1.4 million net loss in Q2 2010.
- 4A substantial litigation judgment expense of $3.3 million was recorded due to an adverse jury verdict in the Turner v. TASER International case.
- 5An asset impairment charge of $1.4 million was recognized for the abandonment of the Protector product line.
- 6Sales, General, and Administrative (SG&A) expenses decreased as a percentage of net sales to 42.8% from 52.2% year-over-year.
- 7The company generated $9.2 million in net cash from operating activities for the first six months of 2011, a significant turnaround from the $2.4 million used in the same period of 2010.