Company Quick10K Filing
Axon Enterprise
Price58.31 EPS0
Shares60 P/E228
MCap3,502 P/FCF176
Net Debt-204 EBIT18
TEV3,298 TEV/EBIT181
TTM 2019-09-30, in MM, except price, ratios
10-Q 2020-06-30 Filed 2020-08-07
10-Q 2020-03-31 Filed 2020-05-08
10-K 2019-12-31 Filed 2020-02-28
10-Q 2019-09-30 Filed 2019-11-08
10-Q 2019-06-30 Filed 2019-08-09
10-Q 2019-03-31 Filed 2019-05-10
10-K 2018-12-31 Filed 2019-02-27
10-Q 2018-09-30 Filed 2018-11-07
10-Q 2018-06-30 Filed 2018-08-09
10-Q 2018-03-31 Filed 2018-05-10
10-K 2017-12-31 Filed 2018-03-01
10-Q 2017-09-30 Filed 2017-11-09
10-Q 2017-06-30 Filed 2017-08-09
10-Q 2017-03-31 Filed 2017-05-10
10-K 2016-12-31 Filed 2017-03-06
10-Q 2016-09-30 Filed 2016-11-09
10-Q 2016-06-30 Filed 2016-08-10
10-Q 2016-03-31 Filed 2016-05-10
10-K 2015-12-31 Filed 2016-03-07
10-Q 2015-09-30 Filed 2015-11-06
10-Q 2015-06-30 Filed 2015-08-06
10-Q 2015-03-31 Filed 2015-05-08
10-K 2014-12-31 Filed 2015-03-12
10-Q 2014-09-30 Filed 2014-11-05
10-Q 2014-06-30 Filed 2014-08-05
10-Q 2014-03-31 Filed 2014-05-06
10-K 2013-12-31 Filed 2014-03-10
10-Q 2013-09-30 Filed 2013-11-05
10-Q 2013-03-31 Filed 2013-05-07
10-K 2012-12-31 Filed 2013-03-08
10-Q 2012-09-30 Filed 2012-11-09
10-Q 2012-06-30 Filed 2012-08-09
10-Q 2012-03-31 Filed 2012-05-10
10-K 2011-12-31 Filed 2012-03-13
10-Q 2011-09-30 Filed 2011-11-09
10-Q 2011-06-30 Filed 2011-08-08
10-Q 2011-03-31 Filed 2011-05-09
10-K 2010-12-31 Filed 2011-03-14
10-Q 2010-09-30 Filed 2010-11-08
10-Q 2010-06-30 Filed 2010-08-06
10-Q 2010-03-31 Filed 2010-05-10
10-K 2009-12-31 Filed 2010-03-15
8-K 2020-08-06 Earnings, Exhibits
8-K 2020-06-16
8-K 2020-06-12
8-K 2020-05-29
8-K 2020-05-07
8-K 2020-02-27
8-K 2020-01-04
8-K 2020-01-03
8-K 2019-11-07
8-K 2019-10-28
8-K 2019-10-10
8-K 2019-08-23
8-K 2019-08-08
8-K 2019-06-13
8-K 2019-05-31
8-K 2019-05-09
8-K 2019-02-26
8-K 2019-02-12
8-K 2018-12-31
8-K 2018-12-19
8-K 2018-12-19
8-K 2018-12-13
8-K 2018-11-06
8-K 2018-10-07
8-K 2018-09-14
8-K 2018-08-20
8-K 2018-08-07
8-K 2018-06-21
8-K 2018-05-24
8-K 2018-05-16
8-K 2018-05-08
8-K 2018-04-06
8-K 2018-02-27
8-K 2018-02-27

AAXN 10Q Quarterly Report

Part I - Financial Information
Item 1. Financial Statements
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations
Item 3. Quantitative and Qualitative Disclosures About Market Risk
Item 4. Controls and Procedures
Part II - Other Information
Item 1. Legal Proceedings
Item 1A. Risk Factors
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
Item 3. Defaults Upon Senior Securities
Item 4. Mine Safety Disclosures
Item 5. Other Information
Item 6. Exhibits
EX-31.1 aaxn-20200630ex3115a739f.htm
EX-31.2 aaxn-20200630ex3125d416c.htm
EX-32 aaxn-20200630xex32.htm

Axon Enterprise Earnings 2020-06-30

Balance SheetIncome StatementCash Flow
0.80.60.50.30.20.02012201420172020
Assets, Equity
0.20.10.10.0-0.0-0.12012201420172020
Rev, G Profit, Net Income
0.30.20.10.0-0.1-0.22012201420172020
Ops, Inv, Fin

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Table of Contents

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-Q

(Mark One)

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2020

or

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from                      to                   

Commission File Number: 001-16391

Axon Enterprise, Inc.

(Exact name of registrant as specified in its charter)

Delaware

86-0741227

(State or other jurisdiction of
incorporation or organization)

(I.R.S. Employer
Identification No.)

17800 North 85th Street

85255

Scottsdale,  Arizona

(Address of principal executive offices)

(Zip Code)

(480) 991-0797

(Registrant’s telephone number, including area code)

Not Applicable

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

Common Stock, $0.00001 Par Value

AAXN

The Nasdaq Global Select Market

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.   Yes      No  

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).   Yes      No  

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer

Accelerated filer

Non-accelerated Filer

Smaller reporting company

Emerging growth company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).   Yes       No  

The number of shares of the registrant’s common stock outstanding as of July 31, 2020 was 63,475,579.

Table of Contents

AXON ENTERPRISE, INC.

INDEX TO QUARTERLY REPORT ON FORM 10-Q

FOR THE QUARTERLY PERIOD ENDED JUNE 30, 2020

Page

Special Note Regarding Forward-Looking Statements

ii

PART I - FINANCIAL INFORMATION

1

Item 1. Financial Statements

1

Condensed Consolidated Balance Sheets as of June 30, 2020 (Unaudited) and December 31, 2019

1

Unaudited Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) for the Three Months and Six Months Ended June 30, 2020 and 2019

2

Unaudited Condensed Consolidated Statements of Stockholders’ Equity for the Three Months and Six Months Ended June 30, 2020 and 2019

3

Unaudited Condensed Consolidated Statements of Cash Flows for the Six Months Ended June 30, 2020 and 2019

4

Notes to Unaudited Condensed Consolidated Financial Statements

5

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

27

Item 3. Quantitative and Qualitative Disclosures About Market Risk

42

Item 4. Controls and Procedures

43

PART II - OTHER INFORMATION

44

Item 1. Legal Proceedings

44

Item 1A. Risk Factors

44

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

44

Item 3. Defaults Upon Senior Securities

45

Item 4. Mine Safety Disclosures

45

Item 5. Other Information

45

Item 6. Exhibits

46

SIGNATURES

47

Table of Contents

Special Note Regarding Forward-Looking Statements

This Report on Form 10-Q contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), including statements regarding our expectations, beliefs, intentions and strategies regarding the future. We intend that such forward-looking statements be subject to the safe-harbor provided by the Private Securities Litigation Reform Act of 1995. From time to time, we also provide forward-looking statements in other materials we release to the public as well as verbal forward-looking statements. These forward-looking statements include, without limitation, statements regarding: the impact of the COVID-19 pandemic; proposed products and services and related development efforts and activities; expectations about the market for our current and future products and services; the impact of pending litigation; trends relating to subscription plan programs and revenues; our anticipation that contracts with governmental customers will be fulfilled; expected trends, including the benefits of, research and development investments; the sufficiency of our liquidity and financial resources; that we may repurchase our common stock; expectations about customer behavior; the impact on our investment portfolio of changes in interest rates; trends in the percentage of our revenues denominated in foreign currencies; our potential use of foreign currency forward and option contracts; statements concerning projections, predictions, expectations, estimates or forecasts as to our business, financial and operational results and future economic performance; statements of management’s strategies, goals and objectives and other similar expressions; as well as the ultimate resolution of financial statement items requiring critical accounting estimates, including those set forth in our Form 10-K for the year ended December 31, 2019. Such statements give our current expectations or forecasts of future events; they do not relate strictly to historical or current facts. Words such as “may,” “will,” “should,” “could,” “would,” “predict,” “potential,” “continue,” “expect,” “anticipate,” “future,” “intend,” “plan,” “believe,” “estimate,” and similar expressions, as well as statements in future tense, identify forward-looking statements. However, not all forward-looking statements contain these identifying words.

We cannot guarantee that any forward-looking statement will be realized, although we believe we have been prudent in our plans and assumptions. Achievement of future results is subject to risks, uncertainties and potentially inaccurate assumptions. The following important factors could cause actual results to differ materially from those in the forward-looking statements: the potential global impacts of the COVID-19 pandemic; our exposure to cancellations of government contracts due to appropriation clauses, exercise of a cancellation clause, or non-exercise of contractually optional periods; our ability to design, introduce and sell new products or features; our ability to defend against litigation and protect our intellectual property, and the resulting costs of this activity; our ability to manage our supply chain and avoid production delays, shortages, and impacts to expected gross margins; the impact of stock compensation expense, impairment expense, and income tax expense on our financial results; customer purchase behavior, including adoption of our software as a service delivery model; negative media publicity regarding our products; the impact of product mix on projected gross margins; defects in our products; changes in the costs of product components and labor; loss of customer data, a breach of security, or an extended outage, including our reliance on third party cloud-based storage providers; exposure to international operational risks; delayed cash collections and possible credit losses due to our subscription model; changes in government regulations in the U.S. and in foreign markets, especially related to the classification of our product by the United States Bureau of Alcohol, Tobacco, Firearms and Explosives and to evolving regulations surrounding privacy and data protection; our ability to integrate acquired businesses; our ability to attract and retain key personnel; and counter-party risks relating to cash balances held in excess of FDIC insurance limits. Many events beyond our control may determine whether results we anticipate will be achieved. Should known or unknown risks or uncertainties materialize, or should underlying assumptions prove inaccurate, actual results could differ materially from past results and those anticipated, estimated or projected. You should bear this in mind as you consider forward-looking statements. The Annual Report on Form 10-K that we filed with the Securities and Exchange Commission ("SEC") on February 28, 2020 and this Quarterly Report on Form 10-Q list various important factors that could cause actual results to differ materially from expected and historical results. These factors are intended as cautionary statements for investors within the meaning of Section 21E of the Exchange Act and Section 27A of the Securities Act. Readers can find them under the heading “Risk Factors” in the Report on Form 10-K and in this Report on Form 10-Q, and investors should refer to them. You should understand that it is not possible to predict or identify all such factors. Consequently, you should not consider any such list to be a complete set of all potential risks or uncertainties.

Except as required by law, we undertake no obligation to publicly update forward-looking statements, whether as a result of new information, future events or otherwise. You are advised, however, to consult any further disclosures we make on related subjects in our Form 10-Q, 8-K and 10-K reports to the SEC. Our filings with the SEC may be accessed at the SEC’s web site at www.sec.gov.

ii

Table of Contents

PART I - FINANCIAL INFORMATION

Item 1. Financial Statements

AXON ENTERPRISE, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands, except share data)

    

June 30,

December 31, 

2020

2019

(Unaudited)

ASSETS

 

  

 

  

Current assets:

 

  

 

  

Cash and cash equivalents

$

319,253

$

172,250

Short-term investments

 

237,980

 

178,534

Accounts and notes receivable, net of allowance of $1,672 and $1,567 as of June 30, 2020 and December 31, 2019, respectively

 

154,253

 

146,878

Contract assets, net

 

50,799

 

38,102

Inventory

 

81,010

 

38,845

Prepaid expenses and other current assets

 

42,429

 

34,866

Total current assets

 

885,724

 

609,475

Property and equipment, net

 

45,386

 

43,770

Deferred tax assets, net

 

34,142

 

27,688

Intangible assets, net

 

11,146

 

12,771

Goodwill

 

24,905

 

25,013

Long-term investments

 

129,580

 

45,499

Long-term notes receivable, net of current portion

 

26,115

 

31,598

Long-term contract assets, net

12,108

9,644

Other assets

 

63,806

 

40,181

Total assets

$

1,232,912

$

845,639

LIABILITIES AND STOCKHOLDERS’ EQUITY

 

  

 

  

Current liabilities:

 

  

 

  

Accounts payable

$

40,105

$

25,874

Accrued liabilities

 

64,467

 

45,001

Current portion of deferred revenue

 

129,518

 

117,864

Customer deposits

 

3,858

 

2,974

Other current liabilities

 

4,882

 

3,853

Total current liabilities

 

242,830

 

195,566

Deferred revenue, net of current portion

 

83,150

 

87,936

Liability for unrecognized tax benefits

 

4,445

 

3,832

Long-term deferred compensation

 

3,990

 

3,936

Deferred tax liability, net

447

354

Other long-term liabilities

 

28,237

 

10,520

Total liabilities

 

363,099

 

302,144

Commitments and contingencies (Note 12)

 

  

 

  

Stockholders’ equity:

 

  

 

  

Preferred stock, $0.00001 par value; 25,000,000 shares authorized; no shares issued and outstanding as of June 30, 2020 and December 31, 2019, respectively

 

 

Common stock, $0.00001 par value; 200,000,000 shares authorized; 63,468,347 and 59,497,759 shares issued and outstanding as of June 30, 2020 and December 31, 2019, respectively

 

1

 

1

Additional paid-in capital

 

883,609

 

528,272

Treasury stock at cost, 20,220,227 shares as of June 30, 2020 and December 31, 2019

 

(155,947)

 

(155,947)

Retained earnings

 

144,940

 

172,265

Accumulated other comprehensive loss

 

(2,790)

 

(1,096)

Total stockholders’ equity

 

869,813

 

543,495

Total liabilities and stockholders’ equity

$

1,232,912

$

845,639

The accompanying notes are an integral part of these condensed consolidated financial statements.

1

Table of Contents

AXON ENTERPRISE, INC.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

AND COMPREHENSIVE INCOME (LOSS)

(in thousands, except per share data)

Three Months Ended June 30, 

Six Months Ended June 30, 

    

2020

    

2019

    

2020

    

2019

Net sales from products

$

98,755

$

80,391

$

206,043

$

168,480

Net sales from services

 

42,504

 

31,971

 

82,378

 

59,692

Net sales

 

141,259

 

112,362

 

288,421

 

228,172

Cost of product sales

 

43,825

 

38,220

 

92,709

 

77,820

Cost of service sales

 

9,257

 

8,582

 

18,927

 

15,875

Cost of sales

 

53,082

 

46,802

 

111,636

 

93,695

Gross margin

 

88,177

 

65,560

 

176,785

 

134,477

Operating expenses:

 

  

 

  

 

  

 

  

Sales, general and administrative

 

72,293

 

43,362

 

135,320

 

86,254

Research and development

 

29,560

 

23,493

 

55,941

 

46,847

Total operating expenses

 

101,853

 

66,855

 

191,261

 

133,101

Income (loss) from operations

 

(13,676)

 

(1,295)

 

(14,476)

 

1,376

Interest and other income, net

 

1,613

 

1,845

 

2,554

 

4,158

Income (loss) before provision for income taxes

 

(12,063)

 

550

 

(11,922)

 

5,534

Provision for (benefit from) income taxes

 

18,696

 

(188)

 

14,763

 

(1,623)

Net income (loss)

$

(30,759)

$

738

$

(26,685)

$

7,157

Net income (loss) per common and common equivalent shares:

 

  

 

  

 

  

 

  

Basic

$

(0.51)

$

0.01

$

(0.44)

$

0.12

Diluted

$

(0.51)

$

0.01

$

(0.44)

$

0.12

Weighted average number of common and common equivalent shares outstanding:

 

  

 

  

 

  

 

  

Basic

 

60,346

 

59,187

 

59,977

 

59,051

Diluted

 

60,346

 

60,000

 

59,977

 

59,876

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

Net income (loss)

$

(30,759)

$

738

$

(26,685)

$

7,157

Foreign currency translation adjustments

 

678

 

(108)

 

(1,694)

 

(58)

Comprehensive income (loss)

$

(30,081)

$

630

$

(28,379)

$

7,099

The accompanying notes are an integral part of these condensed consolidated financial statements.

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Table of Contents

AXON ENTERPRISE, INC.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(in thousands, except share data)

    

    

    

    

    

    

    

Accumulated

    

Additional

Other

Total

Common Stock

Paid-in

Treasury Stock

Retained

Comprehensive

Stockholders’

Shares

Amount

Capital

Shares

Amount

Earnings

Loss

Equity

Balance, December 31, 2019

 

59,497,759

$

1

$

528,272

 

20,220,227

$

(155,947)

$

172,265

$

(1,096)

$

543,495

Cumulative effect of applying a change in accounting principle, net of tax

 

 

 

 

 

 

(640)

 

 

(640)

Issuance of common stock under employee plans, net

 

315,404

 

 

(5,162)

 

 

 

 

 

(5,162)

Stock-based compensation

 

 

 

20,195

 

 

 

 

 

20,195

Net income

 

 

 

 

 

 

4,074

 

 

4,074

Foreign currency translation adjustments

 

 

 

 

 

 

 

(2,372)

 

(2,372)

Balance, March 31, 2020

 

59,813,163

$

1

$

543,305

 

20,220,227

$

(155,947)

$

175,699

$

(3,468)

$

559,590

Issuance of common stock

3,450,000

306,779

306,779

Issuance of common stock under employee plans, net

 

134,571

 

 

(310)

 

 

 

 

 

(310)

Stock-based compensation

 

 

 

33,835

 

 

 

 

 

33,835

Issuance of common stock for business combination contingent consideration

 

70,613

 

 

 

 

 

 

 

Net income (loss)

 

 

 

 

 

 

(30,759)

 

 

(30,759)

Foreign currency translation adjustments

 

 

 

 

 

 

 

678

 

678

Balance, June 30, 2020

 

63,468,347

$

1

$

883,609

 

20,220,227

$

(155,947)

$

144,940

$

(2,790)

$

869,813

    

    

    

    

    

    

    

    

    

    

    

    

    

Accumulated

    

    

Additional

Other

Total

Common Stock

Paid-in

Treasury Stock

Retained

Comprehensive

Stockholders’

Shares

Amount

Capital

Shares

Amount

Earnings

Loss

Equity

Balance, December 31, 2018

    

58,810,637

    

$

1

    

$

453,400

    

20,220,227

    

$

(155,947)

    

$

171,383

    

$

(1,513)

    

$

467,324

Issuance of common stock under employee plans, net

 

298,649

 

 

(1,159)

 

 

 

 

 

(1,159)

Stock-based compensation

 

 

 

7,905

 

 

 

 

 

7,905

Net income

 

 

 

 

 

 

6,419

 

 

6,419

Foreign currency translation adjustments

 

 

 

 

 

 

 

50

 

50

Balance, March 31, 2019

 

59,109,286

$

1

$

460,146

 

20,220,227

$

(155,947)

$

177,802

$

(1,463)

$

480,539

Issuance of common stock under employee plans, net

 

71,832

 

 

(869)

 

 

 

 

 

(869)

Issuance of common stock for business combination contingent consideration

 

70,613

 

 

 

 

 

 

 

Stock-based compensation

 

 

 

8,627

 

 

 

 

 

8,627

Net income

 

 

 

 

 

 

738

 

 

738

Foreign currency translation adjustments

 

 

 

 

 

 

 

(108)

 

(108)

Balance, June 30, 2019

 

59,251,731

$

1

$

467,904

 

20,220,227

$

(155,947)

$

178,540

$

(1,571)

$

488,927

The accompanying notes are an integral part of these condensed consolidated financial statements.

3

Table of Contents

AXON ENTERPRISE, INC.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

Six Months Ended June 30, 

    

2020

    

2019

Cash flows from operating activities:

 

  

 

  

Net income (loss)

$

(26,685)

$

7,157

Adjustments to reconcile net income to net cash used in operating activities:

 

  

 

  

Depreciation and amortization

 

5,811

 

5,487

Loss on disposal and abandonment of intangible assets

 

113

 

18

Loss on disposal and impairment of property and equipment, net

 

1,305

 

1,563

Stock-based compensation

 

54,030

 

16,532

Deferred income taxes

 

(6,152)

 

(1,311)

Unrecognized tax benefits

 

612

 

613

Other noncash, net

 

2,596

 

1,822

Provision for expected credit losses

658

Change in assets and liabilities:

 

 

Accounts and notes receivable and contract assets

 

(9,375)

 

(11,006)

Inventory

 

(43,271)

 

(7,515)

Prepaid expenses and other assets

 

(8,551)

 

(5,761)

Accounts payable, accrued and other liabilities

 

16,708

 

(16,752)

Deferred revenue

 

5,224

 

6,577

Net cash used in operating activities

 

(6,977)

 

(2,576)

Cash flows from investing activities:

 

  

 

  

Purchases of investments

 

(292,597)

 

(141,992)

Proceeds from call / maturity of investments

 

158,670

 

25,319

Purchases of property and equipment

 

(7,551)

 

(7,861)

Proceeds from disposal of property and equipment

78

Purchases of intangible assets

 

(111)

 

(344)

Investment in unconsolidated affiliate

 

(4,700)

 

Net cash used in investing activities

 

(146,211)

 

(124,878)

Cash flows from financing activities:

 

  

 

  

Net proceeds from equity offering

 

306,779

 

Proceeds from options exercised

 

295

 

104

Income and payroll tax payments for net-settled stock awards

 

(5,767)

 

(2,132)

Net cash provided by (used in) financing activities

 

301,307

 

(2,028)

Effect of exchange rate changes on cash and cash equivalents

 

(1,115)

 

(252)

Net increase (decrease) in cash and cash equivalents

 

147,004

 

(129,734)

Cash and cash equivalents and restricted cash, beginning of period

 

172,355

 

351,027

Cash and cash equivalents and restricted cash, end of period

$

319,359

$

221,293

Supplemental disclosures:

 

  

 

  

Cash and cash equivalents

$

319,253

$

219,720

Restricted cash (Note 1)

 

106

 

1,573

Total cash, cash equivalents and restricted cash shown in the statements of cash flows

$

319,359

$

221,293

Cash paid for income taxes, net of refunds

$

6,327

$

1,331

Non-cash transactions

 

  

 

  

Property and equipment purchases in accounts payable and accrued liabilities

$

430

$

91

Investment purchases in accounts payable, net

$

10,400

$

The accompanying notes are an integral part of these condensed consolidated financial statements.

4

Table of Contents

AXON ENTERPRISE, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

1. Organization and Summary of Significant Accounting Policies

Axon Enterprise, Inc. (“Axon,” the “Company,” "we," or "us") is a market-leading provider of law enforcement technology solutions. Our core mission is to protect life. We fulfill that mission through developing hardware and software products that advance the long term objectives of a) obsoleting the bullet, b) reducing social conflict, and c) enabling a fair and effective justice system.

Our headquarters in Scottsdale, Arizona houses our executive management, sales, marketing, certain engineering, manufacturing, and other administrative support functions. We also have a software engineering development center located in Seattle, Washington, and subsidiaries located in Australia, Canada, Finland, Hong Kong, Germany, India, Italy, the Netherlands, the United Kingdom, and V