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On Thursday, Raymond (NSE:RYMD) James reaffirmed its positive stance on Axon Enterprise (NASDAQ:AXON), maintaining an Outperform rating and a price target of $645.00. The firm’s analyst pointed to Axon’s first-quarter results for 2025, which met expectations and highlighted an optimistic future outlook. According to InvestingPro data, analysts maintain a strong buy consensus with price targets ranging from $491 to $800, though the stock currently trades above its calculated Fair Value. The analyst noted that Axon’s Annual Recurring Revenue (ARR) increased by 10% quarter-over-quarter to $1.1 billion, with Net Revenue Retention (NRR) at 123%. Additionally, revenue from subscription plan customers now represents 96% of the total revenue mix.
The company’s future contracted bookings saw a slight quarter-over-quarter decrease of 2%, but remained robust at $9.9 billion. International bookings surpassed expectations, suggesting potential for further growth. The raised guidance anticipates a 27% year-over-year growth, compared to the previous 25%, while maintaining a 25% margin despite a 50 basis point impact from tariffs. InvestingPro data shows impressive revenue growth of 33.4% over the last twelve months, with a strong gross profit margin of nearly 60%.
The analyst also highlighted Axon’s Draft 1 and AI Era products as integral to their positive outlook, citing strong adoption rates and expectations for significant bookings in the second half of the year. The report mentioned that five of the top ten domestic deals included the OSP 10 premium, and two incorporated Draft One. The adoption of TASER 10 was noted to be twice the rate of its predecessor.
The analyst concluded by emphasizing the success of recent product offerings and key performance indicators as drivers for the stock’s potential rise. Axon’s focus on innovation and international market penetration were recognized as factors that could contribute to an upward trajectory in the company’s financial performance. InvestingPro analysis reveals a "GOOD" overall financial health score, with particularly strong momentum and growth metrics. Subscribers can access 16 additional ProTips and a comprehensive Pro Research Report, offering deeper insights into Axon’s valuation and growth prospects.
In other recent news, Axon Enterprise reported first-quarter earnings for 2025 that exceeded market expectations. The company achieved a non-GAAP earnings per share (EPS) of $1.41, surpassing the consensus estimate of $1.30. Axon’s revenue for the quarter reached $604 million, which exceeded the anticipated $585.67 million, marking a 31% year-over-year increase. The company’s adjusted EBITDA rose by 43% year-over-year to $155.2 million, beating the consensus of $141.1 million. JMP analysts maintained their Market Outperform rating for Axon, with a consistent price target of $725, reflecting confidence in the company’s performance and strategic direction.
Axon also reported an annual recurring revenue (ARR) of $1.1 billion, up 34% year-over-year, and a software and services revenue increase of 39% to $263 million. The company’s connected devices revenue grew by 26% to $341 million. Axon launched innovative products, including real-time translation capabilities and new ALPR cameras, which are part of their AI Era Plan. The company’s positive outlook for 2025 includes projected annual revenue between $2.6 billion and $2.7 billion, representing a 27% growth at the midpoint. Axon plans to continue investing in AI and new product development to sustain its growth momentum.
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