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Why Axon Enterprise Stock Rose Today

What happened

Shares in safety and security products maker Axon Enterprise (NASDAQ: AXON) were up 7% Thursday, as of 12:15 p.m. EST. The company announced a new partnership with drone maker Skydio to expand its offerings to law enforcement and emergency responders.

So what

The partnership will bring Skydio's autonomous, artificial intelligence (AI)-powered drones into the Axon Air program for public safety applications. Axon is mainly known for its Tasers, body cameras, and related software. The company says the imagery from Skydio's drones will be integrated into Axon Evidence -- its digital evidence management platform -- along with body camera imagery.

Skydio drone with camera. Image source: Skydio.

Now what

Axon will immediately be making Skydio drones available for purchase, with Axon Evidence and Respond for Devices platform integrations coming later this year. The combination of the U.S.-made drones with Axon technologies "will deliver unprecedented value and unlock the full potential of autonomous drones for live aerial intelligence and accurate evidence management," Skydio chief operating officer Mark Cranney said in a statement. He added that in the last year, the use of Skydio drones for public safety applications has seen strong momentum.

In its most recent earnings report for the fourth quarter and full year 2020, Axon said two of its objectives for 2021 were to "scale new products by developing solutions to real-world challenges," and "unlock new areas for growth by extending our reach to new market."

The company's revenue grew 28% in 2020 compared to the prior year, and it gave guidance for another 12% increase in 2021 at the midpoint of its estimate. Investors have taken notice, with shares having more than doubled since the start of 2020.

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Howard Smith has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Axon Enterprise. The Motley Fool has a disclosure policy.


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