Axon Enterprise Inc. (NASDAQ:AXON)

Asset Turnover Ratios

The reported total asset turnover shows a declining trend from 0.58 in 2018 to 0.42 in 2022, indicating decreasing efficiency in utilizing assets to generate revenue. The adjusted total asset turnover follows a similar pattern, falling from 0.67 in 2018 to 0.50 in 2022, though with a slight rebound in 2021. This decline suggests challenges in asset management or a shift in asset base relative to sales.

Current Ratios

The reported current ratio fluctuates moderately, starting at 3.36 in 2018, dipping to 2.65 in 2021, and improving slightly to 3.00 in 2022, implying generally strong liquidity with some variation. The adjusted current ratio is significantly higher but also volatile, peaking at 10.74 in 2020 before settling around 7.48 in 2022, reflecting considerable short-term asset strength after adjustments.

Debt Ratios

Reported debt to equity and debt to capital ratios are only available for 2022, at 0.53 and 0.35 respectively, indicating moderate leverage levels for that year. Adjusted debt to equity and debt to capital ratios are very low from 2018 to 2021 (0.01-0.02), but they rise sharply in 2022 to 0.42 and 0.29 respectively, suggesting an increased reliance on debt financing in the most recent year.

Financial Leverage

The reported financial leverage ratio remains relatively stable from 2018 to 2021 (around 1.41 to 1.61) but increases notably to 2.25 in 2022, indicating higher leverage. Adjusted financial leverage shows a consistent level near 1.11-1.13 through 2018-2021, then jumps to 1.57 in 2022, confirming an increase in overall leverage after adjustments.

Profitability Margins

Reported net profit margin displays high volatility and negative values during 2019-2021, falling from 6.95% in 2018 to -6.95% in 2021, before rebounding sharply to 12.37% in 2022. Adjusted net profit margin follows a similar U-shaped pattern, albeit with positive values even at its low points, ultimately rising from 16.37% in 2018 to 23.62% in 2022. This pattern reflects a period of profitability challenges followed by strong recovery.

Return on Equity (ROE)

Reported ROE mirrors the instability seen in profit margins, dropping from 6.25% in 2018 to -5.73% in 2021, then recovering to 11.6% in 2022. Adjusted ROE remains positive throughout, though subdued in the middle years, ranging from 12.33% in 2018 to a low of 2.65% in 2021 before increasing to 18.46% in 2022, indicating improving returns to shareholders post-adjustment.

Return on Assets (ROA)

The reported ROA declines from 4.06% in 2018 to negative 3.56% in 2021 but rebounds to 5.16% in 2022, showing reduced asset profitability in intermediate years with recent improvement. Adjusted ROA maintains a generally positive stance, though with a dip in 2021, and improves to 11.79% in 2022, suggesting better asset utilization following adjustments.

Summary

Overall, the data reflect a company experiencing reduced asset efficiency and profitability between 2019 and 2021, accompanied by low returns and negative margins in reported figures. Liquidity measures remain strong but with some volatility. Leverage was minimal through most years but increased substantially in 2022, as indicated by multiple debt and leverage ratios. The profitability and return metrics indicate a significant rebound in 2022, reaching or exceeding previous levels post-adjustment, suggesting a recovery phase possibly fueled by increased leverage.

Net Sales

Net sales demonstrated a consistent upward trajectory from 2018 to 2022, increasing from approximately 420 million USD to nearly 1.19 billion USD. This reflects significant revenue growth, particularly pronounced between 2021 and 2022.

Total Assets

Total assets also experienced substantial growth during the same period, rising from about 720 million USD in 2018 to over 2.85 billion USD in 2022. This represents nearly a fourfold increase, indicating a considerable expansion of asset base over five years.

Reported Total Asset Turnover

The reported total asset turnover ratio, which measures the efficiency of asset use to generate sales, exhibited a declining trend overall. It started at 0.58 in 2018, peaked slightly at 0.63 in 2019, and then decreased steadily to 0.42 by 2022. This suggests that despite growth in sales and assets, the efficiency of converting assets into revenue has weakened over time.

Adjusted Net Sales

Adjusted net sales followed a similar growth pattern as reported net sales but with higher values across all years. Starting at approximately 476 million USD in 2018, adjusted net sales reached around 1.35 billion USD in 2022. The increase is steady each year, showing strong underlying sales performance after adjustments.

Adjusted Total Assets

Adjusted total assets, like total assets, showed consistent and substantial growth, starting at about 715 million USD in 2018 and reaching nearly 2.7 billion USD in 2022. The growth amounts closely mirror those observed in reported total assets, confirming expansion through adjusted figures.

Adjusted Total Asset Turnover

The adjusted total asset turnover ratio showed some fluctuations but generally declined over the period. Beginning at 0.67 in 2018, it hovered around similar levels through 2019, dropped to 0.56 in 2020, then recovered somewhat to 0.66 in 2021 before decreasing again to 0.5 in 2022. Although adjusted turnover is consistently higher than reported figures, the overall trend points to a reduction in asset efficiency despite rising sales and assets.

Overall Observations

The company has exhibited robust growth in both sales and assets between 2018 and 2022, reflecting successful expansion efforts. However, the declining asset turnover ratios—both reported and adjusted—indicate that the growth in assets has outpaced sales growth, resulting in reduced efficiency in asset utilization. This suggests that while the company is scaling, it may need to focus on improving operational efficiency to maximize returns on its expanding asset base.

Current Assets

Current assets have shown a consistent upward trend over the analyzed period. From US$558,155 thousand in 2018, they increased steadily to US$1,805,278 thousand by 2022, indicating substantial growth in liquid and short-term assets available to meet obligations.

Current Liabilities

Current liabilities also rose significantly, growing from US$166,011 thousand in 2018 to US$602,646 thousand in 2022. This increase reflects higher short-term obligations over the years, although the growth rate appears to be proportionally lower compared to current assets in recent years.

Reported Current Ratio

The reported current ratio shows some fluctuations but remains above 2.5 throughout the period, suggesting a healthy liquidity position. It started at 3.36 in 2018, slightly decreased to 3.17 in 2019, peaked at 3.83 in 2020, dropped to 2.65 in 2021, and improved again to 3.00 in 2022, indicating varying degrees of short-term financial strength.

Adjusted Current Assets

Adjusted current assets closely track the reported current assets with slightly higher values each year, rising from US$560,037 thousand in 2018 to US$1,807,454 thousand in 2022. This adjustment suggests consideration of more refined asset valuation or inclusion of additional asset items for liquidity assessment.

Adjusted Current Liabilities

Adjusted current liabilities are notably lower than reported current liabilities throughout the period, beginning at US$58,097 thousand in 2018 and increasing to US$241,798 thousand in 2022. This indicates that certain liabilities may have been excluded or adjusted downward, possibly to reflect more accurate or conservative liability figures.

Adjusted Current Ratio

The adjusted current ratio demonstrates significantly higher liquidity levels than the reported ratio, starting at 9.64 in 2018 and showing some volatility with values of 8.14 in 2019, 10.74 in 2020, and then decreasing to 7.41 in 2021 before stabilizing around 7.48 in 2022. This suggests a very strong short-term financial position when viewed through the lens of adjusted metrics, indicating substantial coverage of liabilities by liquid assets.

Stockholders’ equity

The stockholders’ equity demonstrated a consistent upward trajectory from 2018 through 2022. It increased from approximately 467 million USD in 2018 to nearly 1.27 billion USD by the end of 2022, indicating an expansion of the company's net assets attributable to shareholders over this period.

Reported total debt

Reported total debt data is available only for 2022, where it stood at approximately 674 million USD. Without prior year data, trend analysis on reported total debt is limited.

Adjusted total debt

The adjusted total debt remained relatively modest and stable from 2018 to 2021, ranging between approximately 10.6 million USD and 27 million USD. However, in 2022, it increased sharply to about 717 million USD, indicating a significant rise in debt after a period of low and stable adjusted debt levels.

Adjusted stockholders’ equity

Adjusted stockholders’ equity exhibited steady growth from 632 million USD in 2018 to approximately 1.72 billion USD by 2022, reflecting the company's strengthening equity base when adjustments are taken into account.

Debt to equity ratios

Reported debt to equity ratio

This ratio is reported solely for 2022 and stands at 0.53, indicating that for every dollar of equity, there are approximately 53 cents of reported debt.

Adjusted debt to equity ratio

The adjusted debt to equity ratio was very low and stable from 2018 through 2021, fluctuating between 0.01 and 0.02, suggesting minimal leverage under adjusted measures during those years. However, in 2022, this ratio increased markedly to 0.42, signalling a substantial increase in leverage relative to equity.

Overall insights

Over the five-year period, the company expanded its equity base significantly, both on a reported and adjusted basis. Up until 2021, the company maintained low adjusted leverage levels. The year 2022 marked a notable shift with a substantial increase in adjusted total debt and a corresponding rise in debt to equity ratios. This suggests a strategic change or financing event leading to increased borrowing relative to the equity base, which may affect the company's financial risk profile.

Total capital

The total capital of the company exhibited consistent growth from 2018 through 2022. Starting at approximately 467 million US dollars in 2018, it increased steadily each year, reaching nearly 1.94 billion US dollars by the end of 2022. This represents a more than fourfold increase over the five-year period, reflecting substantial expansion in the company’s capital base.

Total debt

Total debt data is only available for the year ending 2022, where it stands at approximately 674 million US dollars. This value provides a context for the increased capital levels observed within that year but limits trend analysis of total debt over the preceding years.

Reported debt to capital ratio

The reported debt to capital ratio is exclusively provided for 2022, indicating a ratio of 0.35. This suggests that total debt represents 35% of total capital at that time, implying a moderate level of leverage.

Adjusted total debt

Adjusted total debt remained relatively low and stable between 2018 and 2021, fluctuating between approximately 10.6 and 27 million US dollars. However, there is a significant surge in 2022, where adjusted total debt abruptly rises to approximately 717 million US dollars. This increase corresponds closely with the total debt figure for that year, indicating a substantial change in the company's debt structure or accounting adjustments.

Adjusted total capital

Adjusted total capital shows a consistent upward trend from around 645 million US dollars in 2018 to approximately 2.44 billion US dollars in 2022. The growth each year reflects an expanding capital base that outpaces increases in adjusted debt until 2022, where both figures spike significantly.

Adjusted debt to capital ratio

Between 2018 and 2021, the adjusted debt to capital ratio remained low and stable, oscillating between 0.01 and 0.02, indicating minimal leverage relative to adjusted capital. In 2022, this ratio increases markedly to 0.29, reflecting the sharp rise in adjusted total debt relative to adjusted capital. Although leverage increased, the adjusted capital base still remains substantially larger than the adjusted debt.

Total Assets

The total assets of the company displayed a consistent upward trend over the five-year period. Starting at approximately 719.5 million USD in 2018, the assets increased steadily each year, reaching nearly 2.85 billion USD by the end of 2022. This represents a nearly fourfold increase, with significant acceleration in growth observed between 2021 and 2022.

Stockholders’ Equity

Stockholders' equity also experienced continuous growth during the same period, rising from about 467.3 million USD in 2018 to approximately 1.27 billion USD by the end of 2022. The growth was particularly notable from 2019 to 2020 and continued at a steady pace thereafter, reflecting strengthening equity base alongside asset expansion.

Reported Financial Leverage

The reported financial leverage ratio fluctuated moderately from 2018 through 2021, ranging between 1.41 and 1.61. However, in 2022, the ratio sharply increased to 2.25, indicating a higher proportion of total assets financed through liabilities relative to equity in that year. This suggests a notable rise in the company’s financial risk profile or leverage strategy.

Adjusted Total Assets

Adjusted total assets followed a pattern similar to the reported total assets, increasing from approximately 714.9 million USD in 2018 to about 2.70 billion USD in 2022. The adjusted figures consistently stayed slightly below the reported totals but show the same steady and significant growth trend, particularly accelerating in the last year.

Adjusted Stockholders’ Equity

The adjusted stockholders’ equity also showed sustained growth, rising from around 632.2 million USD in 2018 to approximately 1.72 billion USD at the end of 2022. The increase was gradual but consistent, indicating a strengthening equity position after adjustments.

Adjusted Financial Leverage

The adjusted financial leverage ratio remained relatively stable around 1.11 to 1.13 from 2018 to 2021, reflecting a balanced approach to financing assets through liabilities and equity. However, in 2022, this leverage ratio increased markedly to 1.57, although not as high as the reported ratio, signaling increased leverage but with some adjustments mitigating the perceived risk compared to the reported figures.

Summary Insights

Overall, the company exhibited strong growth in both assets and equity over the reviewed period, with a significant acceleration in asset accumulation particularly in the final year. The increase in financial leverage ratios in 2022, both reported and adjusted, suggests a shift toward greater reliance on debt or liabilities to finance growth. The divergence between reported and adjusted leverage ratios in 2022 indicates adjustments that partially moderate the extent of leverage. The stable leverage ratios prior to 2022 imply a consistent financing strategy, while the recent increase might indicate strategic changes or increased risk-taking in capital structure.

The financial data exhibits notable trends and fluctuations over the five-year period from 2018 to 2022. A detailed analysis of key financial metrics reveals various patterns related to profitability, sales growth, and margin stability.

Net Income (Loss)

The net income shows significant volatility across the years. In 2018, net income was positive at 29,205 thousand US dollars, but it sharply declined to 882 thousand US dollars in 2019 and then turned negative in 2020 (-1,724 thousand US dollars) and further deepened the loss in 2021 (-60,018 thousand US dollars). However, 2022 marked a dramatic reversal with a substantial positive net income of 147,139 thousand US dollars, indicating a strong recovery or extraordinary financial event.

Net Sales

Net sales demonstrated consistent growth annually, increasing from 420,068 thousand US dollars in 2018 to 1,189,935 thousand US dollars in 2022. This steady upward trend indicates expanding revenue generation and potentially wider market penetration or higher sales volumes during this period.

Reported Net Profit Margin

The reported net profit margin reflects the net income trend and exhibits considerable instability. Starting at 6.95% in 2018, it dropped significantly to near zero (0.17%) in 2019, then crossed into negative territory in 2020 (-0.25%) and declined further to -6.95% in 2021. In 2022, it rebounded strongly to 12.37%, signifying notable improvement in profitability relative to sales volume.

Adjusted Net Income (Loss)

Adjusted net income, which likely excludes certain non-recurring or extraordinary items, shows a different pattern. It decreased from 77,943 thousand US dollars in 2018 to 17,940 thousand US dollars in 2019 but then rose moderately to 52,308 thousand in 2020. After a dip to 36,461 thousand in 2021, there was a substantial increase to 318,057 thousand US dollars in 2022. This trend suggests that adjusted earnings were more resilient than reported net income during the downturn and experienced exceptional growth in the final year.

Adjusted Net Sales

Adjusted net sales, similar to net sales, displayed consistent growth from 476,219 thousand US dollars in 2018 to 1,346,663 thousand US dollars in 2022. This steady increase supports the understanding of expanding operational scale or enhanced sales performance over this period.

Adjusted Net Profit Margin

The adjusted net profit margin declined sharply from 16.37% in 2018 to 3.23% in 2019, then gradually improved to 6.97% in 2020. It fell again to 3.51% in 2021 but surged dramatically to 23.62% in 2022. This pattern suggests fluctuations in operational efficiency or costs impacting profitability, with a significant margin improvement in the most recent year, pointing to enhanced operational performance or favorable adjustments.

Overall, the data indicates substantial growth in sales volume and revenue over the period analyzed, with fluctuations in profitability metrics likely influenced by market or operational challenges between 2019 and 2021. The marked improvement in both reported and adjusted net income and profit margins in 2022 highlights a significant turnaround toward stronger financial performance.

Net Income (Loss)

The net income exhibited volatility over the analyzed years. It started positively at $29,205 thousand in 2018, declined sharply to $882 thousand in 2019, and then recorded losses in 2020 and 2021, reaching a significant negative value of -$60,018 thousand in 2021. However, there was a substantial recovery in 2022 with net income rising markedly to $147,139 thousand.

Stockholders’ Equity

Stockholders’ equity demonstrated a consistent upward trend throughout the period. The equity increased from $467,324 thousand in 2018 to $1,268,491 thousand in 2022, indicating strengthening financial stability and accumulation of shareholder value over time.

Reported Return on Equity (ROE)

The reported ROE varied significantly during the period. It peaked at 6.25% in 2018 but dropped drastically to very low levels in 2019 (0.16%) and turned negative in 2020 (-0.18%) and 2021 (-5.73%), reflecting the net losses incurred during these years. In 2022, ROE rebounded strongly to 11.6%, aligning with the improved net income performance.

Adjusted Net Income (Loss)

Adjusted net income followed a less volatile and more positive trend compared to the reported net income. Despite declines from $77,943 thousand in 2018 to $17,940 thousand in 2019, adjusted net income improved thereafter, reaching $52,308 thousand in 2020 before a slight dip to $36,461 thousand in 2021. There was a significant surge to $318,057 thousand in 2022, indicating substantial underlying profitability improvements when adjustments are considered.

Adjusted Stockholders’ Equity

Adjusted stockholders’ equity consistently increased from $632,190 thousand in 2018 to $1,722,653 thousand in 2022, mirroring the trend in reported equity but at higher absolute levels, reflecting possibly the inclusion of additional comprehensive income or other adjustments enhancing the equity base.

Adjusted Return on Equity (ROE)

The adjusted ROE remained positive throughout the evaluated years, starting at 12.33% in 2018 but declining to a low of 2.47% in 2019 and stabilizing between 2.65% and 4.33% through 2020 and 2021. A pronounced increase to 18.46% was observed in 2022, indicating an improved return on the adjusted equity base and reinforcing the profitability gains evidenced in adjusted net income.

Net Income (Loss)

The net income experienced significant volatility over the period. Starting with a profit of 29,205 thousand USD in 2018, it sharply dropped to 882 thousand USD in 2019, followed by a loss of 1,724 thousand USD in 2020 and a further substantial loss of 60,018 thousand USD in 2021. In 2022, the company reversed this trend dramatically, achieving a strong profit of 147,139 thousand USD.

Total Assets

Total assets showed a consistent upward trend throughout the period. The asset base grew from 719,540 thousand USD in 2018 to 2,851,894 thousand USD in 2022, indicating substantial expansion of the company's asset holdings over five years, with particularly accelerated growth from 2020 onwards.

Reported Return on Assets (ROA)

The reported ROA followed the pattern of net income but displayed volatility and lower magnitude. It started at a positive 4.06% in 2018, dropped near zero to 0.1% in 2019, turned slightly negative at -0.12% in 2020, and further declined to -3.56% in 2021. It rebounded strongly to 5.16% in 2022, reflecting improved profitability relative to total assets after the prior losses.

Adjusted Net Income (Loss)

Adjusted net income demonstrates a more stable and generally increasing trend compared to reported net income. It began at 77,943 thousand USD in 2018, declined to 17,940 thousand USD in 2019, then increased to 52,308 thousand USD in 2020, dropped to 36,461 thousand USD in 2021, and surged significantly to 318,057 thousand USD in 2022. This suggests adjustments remove some volatility present in reported net income, highlighting stronger underlying earnings performance in recent years.

Adjusted Total Assets

The adjusted total assets also rose consistently from 714,852 thousand USD in 2018 to 2,697,204 thousand USD in 2022. This increasing trend aligns closely with the growth in reported total assets, indicating a similar expansion pattern in asset base after adjustments.

Adjusted Return on Assets (ROA)

The adjusted ROA shows relative stability and a positive long-term trend despite some fluctuations. It started at a high 10.9% in 2018, declined to 2.19% in 2019, rose moderately to 3.91% in 2020, decreased again to 2.33% in 2021, and then increased substantially to 11.79% in 2022. This pattern suggests that the company's adjusted profitability relative to assets underwent some challenges but achieved significant improvement most recently.