Stock Analysis on Net
Stock Analysis on Net

Axon Enterprise Inc. (NASDAQ:AXON)

This company has been moved to the archive! The financial data has not been updated since May 9, 2023.

Common-Size Income Statement

Axon Enterprise Inc., common-size consolidated income statement

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12 months ended: Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019 Dec 31, 2018
Net sales from products 67.35 70.48 73.46 75.25 78.00
Net sales from services 32.65 29.52 26.54 24.75 22.00
Net sales 100.00% 100.00% 100.00% 100.00% 100.00%
Cost of product sales -30.52 -30.13 -32.91 -35.92 -33.17
Cost of service sales -8.24 -7.22 -5.95 -6.20 -5.27
Cost of sales -38.77% -37.35% -38.87% -42.12% -38.44%
Gross margin 61.23% 62.65% 61.13% 57.88% 61.56%
Sales, general and administrative -33.75 -59.65 -45.12 -40.12 -37.35
Research and development -19.65 -22.47 -18.09 -18.97 -18.30
Operating expenses -53.40% -82.12% -63.21% -59.09% -55.64%
Income (loss) from operations 7.84% -19.47% -2.08% -1.20% 5.91%
Interest expense -0.04 0.00 -0.01 -0.01 -0.02
Investment interest income 0.40 0.18 0.60 1.33 0.71
Other income, net 8.32 2.93 0.56 0.28 0.08
Interest and other income, net 8.68% 3.10% 1.15% 1.59% 0.78%
Income (loss) before (provision) benefit for income taxes 16.52% -16.37% -0.92% 0.39% 6.69%
(Provision) benefit for income taxes -4.15 9.42 0.67 -0.22 0.26
Net income (loss) 12.37% -6.95% -0.25% 0.17% 6.95%

Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31).

A comprehensive review of the financial performance from 2018 to 2022 reveals a strategic transition in revenue composition and significant volatility in operating expenses, culminating in a strong recovery of net profitability in the final year of the period.

Revenue Mix Evolution
A consistent shift in the revenue model is observed, with net sales from products declining from 78.00% in 2018 to 67.35% in 2022. Conversely, net sales from services grew steadily from 22.00% to 32.65% over the same period. This indicates a strategic pivot toward a more recurring, service-oriented revenue stream.
Gross Profitability
Gross margins remained relatively resilient, fluctuating between a low of 57.88% in 2019 and a high of 62.65% in 2021, ending the period at 61.23% in 2022. While the cost of product sales as a percentage of net sales decreased from 33.17% to 30.52%, this was partially offset by an increase in the cost of service sales, which rose from 5.27% to 8.24%.
Operating Expenditure Trends
Operating expenses exhibited significant volatility, primarily driven by sales, general, and administrative (SG&A) costs. SG&A expenses climbed from 37.35% in 2018 to a peak of 59.65% in 2021, before dropping sharply to 33.75% in 2022. Research and development (R&D) spending remained more stable, generally oscillating between 18% and 22% of net sales, indicating a sustained commitment to innovation regardless of overall operational profitability.
Operational and Net Profitability
The company experienced a period of operational instability between 2019 and 2021, with income from operations turning negative and reaching a trough of -19.47% in 2021. However, a substantial recovery occurred in 2022, with operating income rising to 7.84%. Net income followed a similar trajectory, moving from a loss of -6.95% in 2021 to a profit of 12.37% in 2022. This bottom-line recovery was further bolstered by a significant increase in other income, net, which rose to 8.32% of net sales in 2022.

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