Axon Enterprise falls 18.2% after earnings miss and guidance cut

What happened

Axon Enterprise (AXON) fell 18.2% on November 6, 2026, because its quarterly earnings missed expectations and it trimmed 2026 revenue guidance tied to delayed federal deployments. Trading ran at 5.0 times its 20-day average as investors reacted to the results, the guidance adjustment and an expanded investment in a drone maker disclosed at the same time.

How big was the move

The stock closed at $313.00, a fall 18.2% on the day and a fall 26.8% over the last five sessions. The stock opened 11.9% below the previous close and the session’s price move was 4.4 times a typical daily move for this stock. The S&P 500 rose 0.3% while the Industrials sector median rose 1.0%, leaving the stock 19.2 percentage points worse than the sector median. The stock’s market value stood at $34.75 billion and its beta was 1.46, meaning the stock tends to move more than the market.

The technical picture

The stock was 23.3% below its 20-day moving average, 29.1% below its 50-day moving average and 33.8% below its 200-day moving average. The 50-day average is below the 200-day average, a sign of a weak longer-term trend. The Relative Strength Index (14 days) read 24, below 30, a level often called oversold, and the share price was 52.9% below its 52-week high. Recent performance showed the stock fell 25.0% over one month and fell 47.5% over three months, leaving it 59.6 percentage points behind the S&P 500 over one year. Volatility ran at 66% annualized over 60 days, higher than 88% of its own readings over five years.

Fundamentals and valuation

For the four quarters through September 30, 2026, revenue totaled $3.42 billion, up 33.6% from a year earlier. The stock’s diluted earnings per share for that period were $3.12, with earnings per share growth down 1.3% from a year earlier. Gross margin was 58.5%, down from 60.3% a year earlier, while operating margin improved to 3.7% from 1.0% a year earlier. Free-cash-flow margin registered 2.4% and return on invested capital was 1.1%. The balance sheet carried net debt of 3.3 times EBITDA, and the share count increased by 6.7% over one year.

On valuation, the stock traded at 100.3 times trailing earnings and 40.7 times price to forward earnings, with a free-cash-flow yield of 0.2%. Its price-to-earnings reading was lower than 74% of its own readings over the past five years, versus a five-year median of 120.0 times earnings. PromtFinance scores showed strength in Revisions at 70 (Positive) and Growth at 56 (Neutral), while Value, Quality, Momentum and Stability were rated very weak.

Earnings and analyst expectations

Axon reported on November 5, 2026, earnings per share of $1.72 against $1.89 expected, 9.0% below estimates, and record third-quarter revenue of $909 million, up 28% year over year. Platform Solutions revenue grew 106% to $125 million and Software & Services revenue rose 43% to $437 million; net income was $57 million versus a net loss in the prior-year period. The company said AI bookings and AI ARR showed strong growth.

After the report, Axon reduced its 2026 revenue growth forecast from the 32%-34% range announced on August 5 to about 30% after removing roughly $130 million of revenue tied to three delayed federal Dedrone deployments. The guidance revision coincided with a miss of third-quarter revenue estimates and a cut to free cash flow guidance.

Analysts covering the stock numbered 22, with a consensus rating of Buy and 82% of ratings at Buy or Strong Buy. The consensus price target was $633.63, 102.4% above the closing price. MarketBeat data compiled and reported by Defense World showed a different average 12-month price objective of $688.38 among 17 analysts, described as a Moderate Buy. Typical two-day reactions after recent reports had been modest, with the stock falling 0.8%.

What to watch

• Next report: February 23, 2027.
• Axon increased its stake in Skydio to 37% and invested an additional $1.2 billion, becoming the exclusive distributor of Skydio drones to U.S. and Canadian public-safety agencies, reported by Reuters and 24/7 Wall Street.
• The firm removed roughly $130 million of revenue tied to three delayed federal Dedrone deployments, which triggered a revision to 2026 revenue growth guidance, reported by Zacks Investment Research and The Motley Fool.
• A law firm notified investors of a pending investigation into the revised forecast and delayed federal deployments, reported by PRNewsWire.
• Consensus price target among 22 analysts: $633.63, 102.4% above the closing price.