Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 30, 2022 | Aug. 05, 2022 | |
Document and Entity Information | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Jun. 30, 2022 | |
Document Transition Report | false | |
Entity File Number | 001-16391 | |
Entity Registrant Name | Axon Enterprise, Inc. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 86-0741227 | |
Entity Address, Address Line One | 17800 North 85th Street | |
Entity Address, City or Town | Scottsdale | |
Entity Address, State or Province | AZ | |
Entity Address, Postal Zip Code | 85255 | |
City Area Code | 480 | |
Local Phone Number | 991-0797 | |
Title of 12(b) Security | Common Stock, $0.00001 Par Value | |
Trading Symbol | AXON | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 71,077,807 | |
Entity Central Index Key | 0001069183 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2022 | |
Document Fiscal Period Focus | Q2 | |
Amendment Flag | false |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 |
Current assets: | ||
Cash and cash equivalents | $ 212,815 | $ 356,332 |
Marketable securities | 45,900 | 72,180 |
Short-term investments | 118,514 | 14,510 |
Accounts and notes receivable, net of allowance of $1,927 and $2,203 as of June 30, 2022 and December 31, 2021, respectively | 379,672 | 320,819 |
Contract assets, net | 196,754 | 180,421 |
Inventory | 154,297 | 108,688 |
Prepaid expenses and other current assets | 61,839 | 56,540 |
Total current assets | 1,169,791 | 1,109,490 |
Property and equipment, net | 157,916 | 138,457 |
Deferred tax assets, net | 100,548 | 127,193 |
Intangible assets, net | 13,934 | 15,470 |
Goodwill | 45,004 | 43,592 |
Long-term investments | 24,925 | 31,232 |
Long-term notes receivable, net | 8,992 | 11,256 |
Long-term contract assets, net | 28,240 | 29,753 |
Strategic investments | 281,691 | 83,520 |
Other long-term assets | 100,982 | 98,247 |
Total assets | 1,932,023 | 1,688,210 |
Current liabilities: | ||
Accounts payable | 60,689 | 32,220 |
Accrued liabilities | 100,980 | 103,707 |
Current portion of deferred revenue | 253,185 | 265,591 |
Customer deposits | 11,330 | 10,463 |
Other current liabilities | 6,787 | 6,540 |
Total current liabilities | 432,971 | 418,521 |
Deferred revenue, net of current portion | 269,477 | 185,721 |
Liability for unrecognized tax benefits | 7,692 | 3,797 |
Long-term deferred compensation | 5,517 | 5,679 |
Deferred tax liability, net | 1 | 811 |
Long-term lease liabilities | 18,210 | 20,440 |
Other long-term liabilities | 4,504 | 5,392 |
Total liabilities | 738,372 | 640,361 |
Commitments and contingencies (Note 13) | ||
Stockholders' equity: | ||
Preferred stock, $0.00001 par value; 25,000,000 shares authorized; no shares issued and outstanding as of June 30, 2022 and December 31, 2021, respectively | ||
Common stock, $0.00001 par value; 200,000,000 shares authorized; 71,077,699 and 70,896,856 shares issued and outstanding as of June 30, 2022 and December 31, 2021, respectively | 1 | 1 |
Additional paid-in capital | 1,139,086 | 1,095,229 |
Treasury stock at cost, 20,220,227 shares as of June 30, 2022 and December 31, 2021 | (155,947) | (155,947) |
Retained earnings | 215,716 | 109,883 |
Accumulated other comprehensive income (loss) | (5,205) | (1,317) |
Total stockholders' equity | 1,193,651 | 1,047,849 |
Total liabilities and stockholders' equity | $ 1,932,023 | $ 1,688,210 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 |
Statement of Financial Position [Abstract] | ||
Allowance on accounts receivable | $ 1,927 | $ 2,203 |
Preferred stock, par value (in dollars per share) | $ 0.00001 | $ 0.00001 |
Preferred stock, shares authorized (in shares) | 25,000,000 | 25,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.00001 | $ 0.00001 |
Common stock, shares authorized (in shares) | 200,000,000 | 200,000,000 |
Common stock, shares issued (in shares) | 71,077,699 | 70,896,856 |
Common stock, shares outstanding (in shares) | 71,077,699 | 70,896,856 |
Treasury stock, shares (in shares) | 20,220,227 | 20,220,227 |
UNAUDITED CONDENSED CONSOLIDATE
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Net sales | $ 285,613 | $ 218,795 | $ 542,039 | $ 413,814 |
Cost of sales | 111,650 | 80,866 | 212,337 | 152,532 |
Gross margin | 173,963 | 137,929 | 329,702 | 261,282 |
Operating expenses: | ||||
Sales, general and administrative | 95,005 | 177,662 | 185,134 | 304,259 |
Research and development | 57,547 | 53,952 | 105,963 | 100,970 |
Total operating expenses | 152,552 | 231,614 | 291,097 | 405,229 |
Income (loss) from operations | 21,411 | (93,685) | 38,605 | (143,947) |
Interest and other income, net | 47,026 | 41,841 | 102,325 | 42,426 |
Income (loss) before provision for income taxes | 68,437 | (51,844) | 140,930 | (101,521) |
Provision for (benefit from) income taxes | 17,475 | (4,727) | 35,097 | (6,487) |
Net income (loss) | $ 50,962 | $ (47,117) | $ 105,833 | $ (95,034) |
Net income (loss) per common and common equivalent shares: | ||||
Basic (in dollars per share) | $ 0.72 | $ (0.72) | $ 1.49 | $ (1.47) |
Diluted (in dollars per share) | $ 0.71 | $ (0.72) | $ 1.46 | $ (1.47) |
Weighted average number of common and common equivalent shares outstanding: | ||||
Basic (in shares) | 71,040 | 65,166 | 70,995 | 64,604 |
Diluted (in shares) | 72,283 | 65,166 | 72,316 | 64,604 |
Net income (loss) | $ 50,962 | $ (47,117) | $ 105,833 | $ (95,034) |
Foreign currency translation adjustments | (2,166) | (369) | (3,238) | (368) |
Unrealized losses on available-for-sale investments | (161) | (650) | ||
Comprehensive income (loss) | 48,635 | (47,486) | 101,945 | (95,402) |
Product | ||||
Net sales | 200,051 | 156,427 | 376,255 | 297,313 |
Cost of sales | 87,502 | 65,301 | 166,854 | 123,917 |
Service | ||||
Net sales | 85,562 | 62,368 | 165,784 | 116,501 |
Cost of sales | $ 24,148 | $ 15,565 | $ 45,483 | $ 28,615 |
UNAUDITED CONDENSED CONSOLIDA_2
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($) $ in Thousands | Common stock | Additional Paid-in Capital | Treasury Stock | Retained Earnings | Accumulated Other Comprehensive Income (Loss) | Total |
Beginning balance at Dec. 31, 2020 | $ 1 | $ 962,159 | $ (155,947) | $ 169,901 | $ 141 | $ 976,255 |
Beginning balance (in shares) at Dec. 31, 2020 | 63,766,555 | 20,220,227 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Issuance of common stock under employee plans, net | (7,045) | (7,045) | ||||
Issuance of common stock under employee plans, net (in shares) | 906,536 | |||||
Stock-based compensation | 89,610 | 89,610 | ||||
Net income (loss) | (47,917) | (47,917) | ||||
Foreign currency translation adjustments | 1 | 1 | ||||
Other comprehensive (loss) income, net | 1 | |||||
Ending balance at Mar. 31, 2021 | $ 1 | 1,044,724 | $ (155,947) | 121,984 | 142 | 1,010,904 |
Ending balance (in shares) at Mar. 31, 2021 | 64,673,091 | 20,220,227 | ||||
Beginning balance at Dec. 31, 2020 | $ 1 | 962,159 | $ (155,947) | 169,901 | 141 | 976,255 |
Beginning balance (in shares) at Dec. 31, 2020 | 63,766,555 | 20,220,227 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income (loss) | (95,034) | |||||
Foreign currency translation adjustments | (368) | |||||
Ending balance at Jun. 30, 2021 | $ 1 | 1,179,005 | $ (155,947) | 74,867 | (227) | 1,097,699 |
Ending balance (in shares) at Jun. 30, 2021 | 65,674,346 | 20,220,227 | ||||
Beginning balance at Mar. 31, 2021 | $ 1 | 1,044,724 | $ (155,947) | 121,984 | 142 | 1,010,904 |
Beginning balance (in shares) at Mar. 31, 2021 | 64,673,091 | 20,220,227 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Issuance of common stock under employee plans, net | (3,268) | (3,268) | ||||
Issuance of common stock under employee plans, net (in shares) | 1,001,255 | |||||
Stock-based compensation | 137,549 | 137,549 | ||||
Net income (loss) | (47,117) | (47,117) | ||||
Foreign currency translation adjustments | (369) | (369) | ||||
Other comprehensive (loss) income, net | (369) | |||||
Ending balance at Jun. 30, 2021 | $ 1 | 1,179,005 | $ (155,947) | 74,867 | (227) | 1,097,699 |
Ending balance (in shares) at Jun. 30, 2021 | 65,674,346 | 20,220,227 | ||||
Beginning balance at Dec. 31, 2021 | $ 1 | 1,095,229 | $ (155,947) | 109,883 | (1,317) | 1,047,849 |
Beginning balance (in shares) at Dec. 31, 2021 | 70,896,856 | 20,220,227 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Issuance of common stock | (70) | (70) | ||||
Issuance of common stock under employee plans, net | (1,388) | (1,388) | ||||
Issuance of common stock under employee plans, net (in shares) | 99,802 | |||||
Stock-based compensation | 25,088 | 25,088 | ||||
Net income (loss) | 54,871 | 54,871 | ||||
Other comprehensive (loss) income, net | (1,561) | (1,561) | ||||
Ending balance at Mar. 31, 2022 | $ 1 | 1,118,859 | $ (155,947) | 164,754 | (2,878) | 1,124,789 |
Ending balance (in shares) at Mar. 31, 2022 | 70,996,658 | 20,220,227 | ||||
Beginning balance at Dec. 31, 2021 | $ 1 | 1,095,229 | $ (155,947) | 109,883 | (1,317) | 1,047,849 |
Beginning balance (in shares) at Dec. 31, 2021 | 70,896,856 | 20,220,227 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income (loss) | 105,833 | |||||
Foreign currency translation adjustments | (3,238) | |||||
Ending balance at Jun. 30, 2022 | $ 1 | 1,139,086 | $ (155,947) | 215,716 | (5,205) | 1,193,651 |
Ending balance (in shares) at Jun. 30, 2022 | 71,077,699 | 20,220,227 | ||||
Beginning balance at Mar. 31, 2022 | $ 1 | 1,118,859 | $ (155,947) | 164,754 | (2,878) | 1,124,789 |
Beginning balance (in shares) at Mar. 31, 2022 | 70,996,658 | 20,220,227 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Issuance of common stock | (4) | (4) | ||||
Issuance of common stock under employee plans, net | (931) | (931) | ||||
Issuance of common stock under employee plans, net (in shares) | 81,041 | |||||
Stock-based compensation | 21,162 | 21,162 | ||||
Net income (loss) | 50,962 | 50,962 | ||||
Foreign currency translation adjustments | (2,166) | |||||
Other comprehensive (loss) income, net | (2,327) | (2,327) | ||||
Ending balance at Jun. 30, 2022 | $ 1 | $ 1,139,086 | $ (155,947) | $ 215,716 | $ (5,205) | $ 1,193,651 |
Ending balance (in shares) at Jun. 30, 2022 | 71,077,699 | 20,220,227 |
UNAUDITED CONDENSED CONSOLIDA_3
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | |
Cash flows from operating activities: | ||
Net income (loss) | $ 105,833 | $ (95,034) |
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | ||
Depreciation and amortization | 11,965 | 8,582 |
Purchase accounting adjustments to goodwill | 58 | |
Loss on disposal and abandonment of intangible assets | 48 | 130 |
Loss on disposal and impairment of property and equipment, net | 189 | 43 |
Gain on strategic investments and marketable securities, net | (103,836) | (40,855) |
Stock-based compensation | 46,250 | 227,159 |
Deferred income taxes | 26,050 | (6,889) |
Unrecognized tax benefits | 3,895 | 47 |
Bond amortization | 301 | 3,110 |
Noncash lease expense | 3,279 | 2,650 |
Provision for expected credit losses | 183 | 62 |
Change in assets and liabilities: | ||
Accounts and notes receivable and contract assets | (80,247) | (3,988) |
Inventory | (47,109) | (1,848) |
Prepaid expenses and other assets | (2,688) | (13,320) |
Accounts payable, accrued and other liabilities | 24,569 | (10,381) |
Deferred revenue | 74,600 | 25,647 |
Net cash provided by operating activities | 63,340 | 95,115 |
Cash flows from investing activities: | ||
Purchases of investments | (108,240) | (238,288) |
Proceeds from call / maturity of investments | 9,473 | 294,814 |
Exercise of warrants of strategic investments | (6,555) | |
Proceeds from sale of strategic investments | 14,546 | |
Purchases of property and equipment | (29,847) | (24,031) |
Proceeds from disposal of property and equipment | 91 | 48 |
Purchases of intangible assets | (104) | (143) |
Strategic investments | (61,500) | (20,500) |
Business acquisition, net of cash acquired | (2,104) | |
Net cash provided (used) in investing activities | (198,786) | 26,446 |
Cash flows from financing activities: | ||
Net proceeds from equity offering | (74) | |
Income and payroll tax payments for net-settled stock awards | (2,319) | (10,312) |
Net cash used in financing activities | (2,393) | (10,312) |
Effect of exchange rate changes on cash and cash equivalents | (3,910) | (319) |
Net increase (decrease) in cash and cash equivalents | (141,749) | 110,930 |
Cash and cash equivalents and restricted cash, beginning of period | 356,438 | 155,551 |
Cash and cash equivalents and restricted cash, end of period | $ 214,689 | $ 266,481 |
UNAUDITED CONDENSED CONSOLIDA_4
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - Supplemental - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | |
Supplemental disclosures: | ||
Cash and cash equivalents | $ 212,815 | $ 266,372 |
Restricted cash (Note 1) | 1,874 | 109 |
Total cash, cash equivalents and restricted cash shown in the statements of cash flows | 214,689 | 266,481 |
Cash paid for income taxes, net of refunds | 2,289 | 5,295 |
Non-cash transactions | ||
Property and equipment purchases in accounts payable and accrued liabilities | $ 2,009 | $ 571 |
Organization and Summary of Sig
Organization and Summary of Significant Accounting Policies | 6 Months Ended |
Jun. 30, 2022 | |
Organization and Summary of Significant Accounting Policies | |
Organization and Summary of Significant Accounting Policies | Note 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, finance and other administrative support functions. Our global software hub is located in Seattle, Washington, and we also have subsidiaries and / or offices located in Australia, Canada, Finland, France, Germany, Hong Kong, India, Italy, the Netherlands, the United Kingdom, and Vietnam. The accompanying unaudited condensed consolidated financial statements include the accounts of Axon Enterprise, Inc. and our subsidiaries. All material intercompany accounts, transactions, and profits have been eliminated. Basis of Presentation and Use of Estimates These unaudited condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the SEC. Certain information related to our organization, significant accounting policies and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”) has been condensed or omitted. The accounting policies followed in the preparation of these unaudited condensed consolidated financial statements are consistent with those followed in our annual consolidated financial statements for the year ended December 31, 2021, as filed on Form 10-K, with the exception of our adoption of certain accounting pronouncements which we describe below. In the opinion of management, these unaudited condensed consolidated financial statements contain all material adjustments, consisting only of normal recurring adjustments, necessary to fairly state our financial position, results of operations and cash flows for the periods presented and the presentations and disclosures herein are adequate when read in conjunction with our Form 10-K for the year ended December 31, 2021. The results of operations for the three months and six months ended June 30, 2022 are not necessarily indicative of the results to be expected for the full year (or any other period). Significant estimates and assumptions in these unaudited condensed consolidated financial statements include: ● product warranty reserves, ● inventory valuation, ● revenue recognition, ● reserve for expected credit loss, ● valuation of goodwill, intangible and long-lived assets, ● valuation of strategic investments, ● recognition, measurement and valuation of current and deferred income taxes, ● stock-based compensation, and ● recognition and measurement of contingencies and accrued litigation expense. Actual results could differ materially from those estimates. Segment Information Our operations are comprised of two reportable segments: the manufacture and sale of conducted electrical devices ("CEDs"), batteries, accessories, extended warranties and other products and services (the “TASER” segment); and the development, manufacture, and sale of software and sensors, which includes the sale of devices, wearables, applications, cloud and mobile products, and services (collectively, the “Software and Sensors” segment). In both segments, we report sales of products and services. Service revenue in both segments includes sales related to Axon Evidence. In the Software and Sensors segment, service revenue also includes other recurring cloud-hosted software revenue and related professional services. Collectively, this revenue is sometimes referred to as "Axon Cloud revenue." Reportable segments are determined based on discrete financial information reviewed by our Chief Executive Officer who is our chief operating decision maker ("CODM"). We organize and review operations based on products and services, and currently there are no operating segments that are aggregated. We perform an analysis of our reportable segments at least annually. Additional information related to our business segments is summarized in Note 15. Geographic Information and Major Customers / Suppliers For the three and six months ended June 30, 2022, no individual country outside the U.S. represented more than 10% of total net sales. Individual sales transactions in the international market are generally larger and occur more intermittently than in the domestic market due to the profile of our customers. For the three and six months ended June 30, 2022, no customer represented more than 10% of total net sales. At June 30, 2022 and December 31, 2021, no customer represented more than 10% of the aggregate balance of accounts and notes receivable and contract assets. We currently purchase both off the shelf and custom components, including, but not limited to, finished circuit boards, injection-molded plastic components, small machined parts, custom cartridge components, electronic components, and off the shelf sub-assemblies from suppliers located in the U.S., Canada, China, Republic of Korea, Malaysia, Mexico, Taiwan, and Vietnam. We may source from other countries as well. Although we currently obtain many of these components from single source suppliers, we own the injection molded component tooling, most of the designs, and the test fixtures used in their production for all custom components. As a result, we believe we could obtain alternative suppliers in most cases. Although we have experienced supply chain disruptions relating to materials and port constraints, we have remained focused on closely managing our supply chain. We continue to bolster our strategic relationships in our supply chain, identifying secondary/alternate sourcing, adjusting build plans accordingly, and building in logistic modes in support of our increasing demand while working to minimize disruption to customers. We acquire most of our components on a purchase order basis and do not currently have significant long-term purchase contracts with most component suppliers. Income per Common Share Basic income per common share is computed by dividing net income by the weighted average number of common shares outstanding during the periods presented. Diluted income per share reflects the potential dilution from outstanding stock options and unvested restricted stock units. The calculation of the weighted average number of shares outstanding and earnings per share are as follows (in thousands except per share data): Three Months Ended June 30, Six Months Ended June 30, 2022 2021 2022 2021 Numerator for basic and diluted earnings per share: Net income (loss) $ 50,962 $ (47,117) $ 105,833 $ (95,034) Denominator: Weighted average shares outstanding 71,040 65,166 70,995 64,604 Dilutive effect of stock-based awards 1,243 — 1,321 — Diluted weighted average shares outstanding 72,283 65,166 72,316 64,604 Anti-dilutive stock-based awards excluded 2,991 10,537 2,912 8,950 Net income (loss) per common share: Basic $ 0.72 $ (0.72) $ 1.49 $ (1.47) Diluted $ 0.71 $ (0.72) $ 1.46 $ (1.47) Standard Warranties We warranty our CEDs, Axon cameras and certain related accessories from manufacturing defects on a limited basis for a period of one year after purchase and, thereafter, will repair or replace any defective unit for a fee. Estimated costs for the standard warranty are charged to cost of products sold when revenue is recorded for the related product. Future warranty costs are estimated based on historical data related to warranty claims and this rate is applied to current product sales. Historically, reserve amounts have been increased if management becomes aware of a component failure or other issue that could result in larger than anticipated warranty claims from customers. The warranty reserve is reviewed quarterly to verify that it sufficiently reflects the remaining warranty obligations based on the anticipated expenditures over the balance of the warranty obligation period, and adjustments are made when actual warranty claim experience differs from estimates. The warranty reserve is included in accrued liabilities on the accompanying condensed consolidated balance sheets. Changes in our estimated product warranty liabilities were as follows (in thousands): Six Months Ended June 30, 2022 2021 Balance, beginning of period $ 2,822 $ 769 Utilization of reserve (1,574) (481) Warranty expense 380 613 Balance, end of period $ 1,628 $ 901 Fair Value Measurements and Financial Instruments We use the fair value framework that prioritizes the inputs to valuation techniques for measuring financial assets and liabilities measured on a recurring basis and for non-financial assets and liabilities when these items are re-measured. Fair value is considered to be the exchange price in an orderly transaction between market participants, to sell an asset or transfer a liability at the measurement date. The hierarchy below lists three levels of fair value based on the extent to which inputs used in measuring fair value are observable in the market. We categorize each of our fair value measurements in one of these three levels based on the lowest level input that is significant to the fair value measurement in its entirety. These levels are: ● Level 1 – Valuation techniques in which all significant inputs are unadjusted quoted prices from active markets for assets or liabilities that are identical to the assets or liabilities being measured. ● Level 2 – Valuation techniques in which significant inputs include quoted prices from active markets for assets or liabilities that are similar to the assets or liabilities being measured and/or quoted prices for assets or liabilities that are identical or similar to the assets or liabilities being measured from markets that are not active. Also, model-derived valuations in which all significant inputs and significant value drivers are observable in active markets are Level 2 valuation techniques. ● Level 3 – Valuation techniques in which one or more significant inputs or significant value drivers are unobservable. Unobservable inputs are valuation technique inputs that reflect our own assumptions about inputs that market participants would use in pricing an asset or liability. We have cash equivalents and investments, which at June 30, 2022 and December 31, 2021 were comprised of money market funds, commercial paper, corporate bonds, municipal bonds, U.S. Government agency bonds, and U.S. Treasury bills. See additional disclosure regarding the fair value of our cash equivalents and investments in Note 3. Included in the balance of other long-term assets as of June 30, 2022 and December 31, 2021 was $4.2 million and $5.3 million, respectively, related to corporate-owned life insurance policies which are used to fund our deferred compensation plan. We determine the fair value of insurance contracts by obtaining the cash surrender value of the contracts from the issuer, a Level 2 valuation technique. We have an investment in marketable securities, for which c hanges in fair value are recorded in the condensed consolidated statement of operations as unrealized gain or (loss) on marketable securities, which is included in interest and other income, net. We have strategic investments in six unconsolidated affiliates as of June 30, 2022. The estimated fair value of the investments was determined based on Level 3 inputs. In determining the estimated fair value of our strategic investments in privately held companies, we utilize observable data available to us as discussed further in Note 7. Our financial instruments also include accounts and notes receivable, accounts payable and accrued liabilities. Due to the short-term nature of these instruments, their fair values approximate their carrying values on the condensed consolidated balance sheet. Restricted Cash Restricted cash balances as of June 30, 2022 were $1.9 million primarily related to funds held in an international bank account securing a guarantee and funds held in an international bank account for a country in which we are required to maintain a minimum balance to operate. Approximately $1.8 million was included in prepaid expenses and other current assets on our condensed consolidated balance sheet, with the remainder included in other long-term assets Valuation of Goodwill, Intangibles and Long-lived Assets We evaluate whether events and circumstances have occurred that indicate the remaining estimated useful life of long-lived assets and identifiable intangible assets, excluding goodwill and intangible assets with indefinite useful lives, may warrant revision or that the remaining balance of these assets may not be recoverable. Such circumstances could include, but are not limited to, a change in the product mix, a change in the way products are created, produced or delivered, or a significant change in the way products are branded and marketed. In performing the review for recoverability, we estimate the future undiscounted cash flows expected to result from the use of the assets and their eventual disposition. The amount of the impairment loss, if impairment exists, is calculated based on the excess of the carrying amounts of the assets over their estimated fair value computed using discounted cash flows. We do not amortize goodwill and intangible assets with indefinite useful lives; rather such assets are required to be tested for impairment at least annually or sooner whenever events or changes in circumstances indicate that the assets may be impaired. We perform our annual goodwill and intangible asset impairment tests in the fourth quarter of each year. Recently Issued Accounting Guidance Recently Adopted Accounting Pronouncements In November 2021, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2021-10, Government Assistance (Topic 832). The guidance improves the transparency of government assistance accounting as it requires business entities to disclose transactions that involve government assistance received if the transactions were accounted for by applying a grant or contribution accounting model by analogy. The ASU is effective for annual periods beginning after December 15, 2021. We adopted ASU 2021-10 on January 1, 2022 and will apply the disclosure requirement prospectively to all transactions within the scope of the amendments that are reflected in the financial statements at the date of the initial application along with new transactions that are entered into after the date of initial application. Adoption of this ASU did not have a material impact on our consolidated financial statements. Reclassification of Prior Year Presentation Certain prior year amounts have been reclassified for consistency with the current year presentation. These reclassifications are not material and had no effect on the reported results of operations. |
Revenues
Revenues | 6 Months Ended |
Jun. 30, 2022 | |
Revenues | |
Revenues | Note 2 - Revenues Nature of Products and Services The following tables present our revenues by primary product and service offering (in thousands): Three Months Ended June 30, 2022 Three Months Ended June 30, 2021 Software and Software and TASER Sensors Total TASER Sensors Total TASER 7 $ 53,440 $ — $ 53,440 $ 28,128 — $ 28,128 TASER X26P 12,339 — 12,339 9,569 — 9,569 TASER X2 4,534 — 4,534 16,145 — 16,145 TASER Consumer devices 1,687 — 1,687 1,701 — 1,701 Cartridges 49,845 — 49,845 46,678 — 46,678 Axon Body — 27,468 27,468 — 19,927 19,927 Axon Flex — 621 621 — 1,088 1,088 Axon Fleet — 15,881 15,881 — 5,247 5,247 Axon Dock — 5,849 5,849 — 5,509 5,509 Axon Evidence and cloud services 3,720 81,911 85,631 1,702 60,367 62,069 Extended warranties 7,459 12,498 19,957 5,857 8,149 14,006 Other 2,562 5,799 8,361 2,748 5,980 8,728 Total $ 135,586 $ 150,027 $ 285,613 $ 112,528 $ 106,267 $ 218,795 Six Months Ended June 30, 2022 Six Months Ended June 30, 2021 Software and Software and TASER Sensors Total TASER Sensors Total TASER 7 $ 103,506 $ — $ 103,506 $ 62,119 — $ 62,119 TASER X26P 21,818 — 21,818 19,532 — 19,532 TASER X2 8,153 — 8,153 28,923 — 28,923 TASER Pulse 3,383 — 3,383 3,906 — 3,906 Cartridges 87,670 — 87,670 77,096 — 77,096 Axon Body — 57,176 57,176 — 39,683 39,683 Axon Flex — 1,950 1,950 — 1,993 1,993 Axon Fleet — 29,701 29,701 — 9,010 9,010 Axon Dock — 13,329 13,329 — 12,429 12,429 Axon Evidence and cloud services 6,737 161,850 168,587 3,098 112,661 115,759 Extended warranties 14,138 21,559 35,697 11,503 15,649 27,152 Other 4,541 6,528 11,069 5,350 10,862 16,212 Total $ 249,946 $ 292,093 $ 542,039 $ 211,527 $ 202,287 $ 413,814 The following table presents our revenues disaggregated by geography (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2022 2021 2022 2021 United States $ 228,446 80 % $ 164,908 75 % $ 442,660 82 % $ 325,294 79 % Other countries 57,167 20 53,887 25 99,379 18 88,520 21 Total $ 285,613 100 % $ 218,795 100 % $ 542,039 100 % $ 413,814 100 % Contract Balances The following table presents our contract assets, contract liabilities and certain information related to these balances as of and for the six months ended June 30, 2022 (in thousands): June 30, 2022 Contract assets, net $ 224,994 Contract liabilities (deferred revenue) 522,662 Revenue recognized in the period from: Amounts included in contract liabilities at the beginning of the period 172,675 Contract liabilities (deferred revenue) consisted of the following (in thousands): June 30, 2022 December 31, 2021 Current Long-Term Total Current Long-Term Total Warranty: TASER $ 16,038 $ 18,222 $ 34,260 $ 21,257 $ 4,766 $ 26,023 Software and Sensors 19,736 22,078 41,814 23,175 18,137 41,312 35,774 40,300 76,074 44,432 22,903 67,335 Hardware: TASER 26,579 20,016 46,595 12,944 28,727 41,671 Software and Sensors 47,149 94,855 142,004 34,862 81,223 116,085 73,728 114,871 188,599 47,806 109,950 157,756 Services: TASER 3,102 6,555 9,657 2,701 3,482 6,183 Software and Sensors 140,581 107,751 248,332 170,652 49,386 220,038 143,683 114,306 257,989 173,353 52,868 226,221 Total $ 253,185 $ 269,477 $ 522,662 $ 265,591 $ 185,721 $ 451,312 June 30, 2022 December 31, 2021 Current Long-Term Total Current Long-Term Total TASER $ 45,719 $ 44,793 $ 90,512 $ 36,902 $ 36,975 $ 73,877 Software and Sensors 207,466 224,684 432,150 228,689 148,746 377,435 Total $ 253,185 $ 269,477 $ 522,662 $ 265,591 $ 185,721 $ 451,312 Remaining Performance Obligations As of June 30, 2022, we had approximately $3.33 billion of remaining performance obligations, which included both recognized contract liabilities as well as amounts that will be invoiced and recognized in future periods. The remaining performance obligations are limited only to arrangements that meet the definition of a contract under Topic 606 as of June 30, 2022. We expect to recognize between 15% - 20% of this balance over the next twelve months, and generally expect the remainder to be recognized over the following ten years, subject to risks related to delayed deployments, budget appropriation or other contract cancellation clauses. |
Cash, Cash Equivalents and Inve
Cash, Cash Equivalents and Investments | 6 Months Ended |
Jun. 30, 2022 | |
Cash, Cash Equivalents and Investments | |
Cash, Cash Equivalents and Investments | Note 3 - Cash, Cash Equivalents and Investments The following tables summarize our cash, cash equivalents, marketable securities, and available-for-sale investments at June 30, 2022 and December 31, 2021 (in thousands): As of June 30, 2022 Gross Gross Cash and Amortized Unrealized Unrealized Cash Marketable Short-Term Long-Term Cost Gains Losses Fair Value Equivalents Securities Investments Investments Cash $ 155,582 $ — $ — $ 155,582 $ 155,582 $ — $ — $ — Level 1: Money market funds 43,550 — — 43,550 43,550 — — — Agency bonds 26,601 5 (2) 26,604 8,484 — 18,120 — Treasury bills 28,390 — (24) 28,366 — — 22,690 5,676 Marketable securities 90,000 — (44,100) 45,900 — 45,900 — — Subtotal 188,541 5 (44,126) 144,420 52,034 45,900 40,810 5,676 Level 2: State and municipal obligations 5,814 1 (35) 5,780 — — 4,257 1,523 Corporate bonds 57,609 11 (1,027) 56,593 5,199 — 33,668 17,726 Commercial paper 39,779 — — 39,779 — — 39,779 — Subtotal 103,202 12 (1,062) 102,152 5,199 — 77,704 19,249 Total $ 447,325 $ 17 $ (45,188) $ 402,154 $ 212,815 $ 45,900 $ 118,514 $ 24,925 As of June 30, 2022, we had $86.7 million of investments with unrealized losses. During the year ended December 31, 2021, we acquired 9,000,000 shares of common stock of Cellebrite DI Ltd (“CLBT”) with a fair value of $90.0 million. The CLBT common stock is recorded as marketable securities in the accompanying condensed consolidated balance sheets and its fair value is adjusted every reporting period. Changes in fair value are recorded in the condensed consolidated statement of operations as unrealized gain or (loss) on marketable securities, which is included in interest and other income, net. During the three and six months ended June 30, 2022, we recorded an unrealized loss on marketable securities of $11.7 million and $ 26.3 million, respectively, relating to CLBT. As of December 31, 2021 Gross Gross Cash and Amortized Unrealized Unrealized Cash Marketable Short-Term Long-Term Cost Gains Losses Fair Value Equivalents Securities Investments Investments Cash $ 353,488 $ — $ — $ 353,488 $ 353,488 $ — $ — $ — Level 1: Money market funds 2,844 — — 2,844 2,844 — — — Agency bonds 10,700 4 — 10,704 — — 10,704 — Marketable securities 90,000 — (17,820) 72,180 — 72,180 — — Subtotal 103,544 4 (17,820) 85,728 2,844 72,180 10,704 — Level 2: State and municipal obligations 2,570 — (5) 2,565 — — 1,400 1,165 Corporate bonds 32,748 1 (276) 32,473 — — 2,406 30,067 Subtotal 35,318 1 (281) 35,038 — — 3,806 31,232 Total $ 492,350 $ 5 $ (18,101) $ 474,254 $ 356,332 $ 72,180 $ 14,510 $ 31,232 |
Expected Credit Losses
Expected Credit Losses | 6 Months Ended |
Jun. 30, 2022 | |
Expected Credit Losses | |
Expected Credit Losses | Note 4 - Expected Credit Losses We are exposed to credit losses primarily through sales of products and services. Our expected loss allowance methodology for accounts receivable, notes receivable, and contract assets is developed using historical collection experience, published or estimated credit default rates for entities that represent our customer base, current and future economic and market conditions and a review of the current status of customers' trade accounts receivables. Additionally, specific allowance amounts are established to record the appropriate provision for customers that have a higher probability of default. Our monitoring activities include account reconciliation, dispute resolution, payment confirmation, consideration of customers' financial condition and macroeconomic conditions. Balances are written off when determined to be uncollectible. We review receivables for U.S. and international customers separately to better reflect different published credit default rates and economic and market conditions. The following table provides a roll-forward of the allowance for expected credit losses that is deducted from the amortized cost basis of accounts receivable, notes receivable, and contract assets to present the net amount expected to be collected (in thousands): Six Months Ended June 30, 2022 United States Other countries Total Balance, beginning of period $ 3,171 $ 178 $ 3,349 Provision for expected credit losses (50) 233 183 Amounts written off charged against the allowance (396) - (396) Other, including foreign currency translation - (3) (3) Balance, end of period $ 2,725 $ 408 $ 3,133 June 30, December 31, 2022 2021 Accounts receivable and notes receivable, current $ 1,927 $ 2,203 Contract assets, net 1,058 1,010 Long-term notes receivable, net of current portion 148 136 Total allowance for expected credit losses on customer receivables $ 3,133 $ 3,349 |
Inventory
Inventory | 6 Months Ended |
Jun. 30, 2022 | |
Inventory | |
Inventory | Note 5 - Inventory Inventories are stated at the lower of cost, determined on the first-in, first-out (“FIFO”) basis, or net realizable value, net of an inventory valuation allowance. We use a standard cost methodology to determine the cost basis for its inventories. Costs include allocations for materials, labor, and overhead. All variances between actual costs and standard costs are apportioned to inventory and cost of goods sold based upon inventory turnover. We evaluate inventory on a quarterly basis for obsolete or slow-moving items to ascertain if the recorded allowance is reasonable and adequate. Additional provisions are made to reduce excess, obsolete or slow-moving inventories to their net realizable value. Inventory consisted of the following at June 30, 2022 and December 31, 2021 (in thousands): June 30, 2022 December 31, 2021 Raw materials $ 50,995 $ 38,267 Finished goods 103,302 70,421 Total inventory $ 154,297 $ 108,688 |
Property and Equipment
Property and Equipment | 6 Months Ended |
Jun. 30, 2022 | |
Property and Equipment | |
Property and Equipment | Note 6 – Property and Equipment Property and equipment consisted of the following (in thousands): Estimated Useful Life June 30, 2022 December 31, 2021 Land N/A $ 51,612 $ 54,868 Land held for sale N/A 3,173 — Building and leasehold improvements 3-39 years 26,745 25,712 Production equipment 3-5 years 54,879 54,090 Computers, equipment and software 3-5 years 21,338 15,343 Furniture and office equipment 3-5 years 7,407 6,838 Vehicles 5 years 3,624 2,932 Website development costs 3 years 204 204 Capitalized internal-use software development costs 3-5 years 13,994 11,996 Construction-in-process N/A 42,904 25,258 Total cost 225,880 197,241 Less: Accumulated depreciation (67,964) (58,784) Property and equipment, net $ 157,916 $ 138,457 During the three months ended June 30, 2022, we reclassified a plat of land as held for sale which we anticipate dedicating to the City of Scottsdale pursuant to our existing public infrastructure reimbursement development agreement. Construction-in-process includes $21.2 million and $12.4 million related to the development of our new campus at June 30, 2022 and December 31, 2021, respectively. |
Strategic Investments
Strategic Investments | 6 Months Ended |
Jun. 30, 2022 | |
Strategic Investments | |
Strategic Investments | Note 7 - Strategic Investments Strategic investments include investments in a number of non-public technology-driven companies. We account for strategic investments under the Accounting Standards Codification (“ASC”) 321 measurement alternative for equity securities without readily determinable fair values, as there are no quoted market prices for the investments. The investments are measured at cost less impairment, adjusted for observable price changes and are assessed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. In conjunction with certain of our strategic investments, we have the ability to commit additional capital over time through warrants and call options; for some investments, the exercisability and exercise prices are conditional on the achievement of certain performance metrics. The following tables provide a roll-forward of the balance of strategic investments (in thousands): Six Months Ended June 30, 2022 Six Months Ended June 30, 2021 Strategic investments Warrants Call options Total Strategic investments Warrants Total Balance, beginning of period $ 80,775 $ 2,745 $ — $ 83,520 $ 9,500 $ 2,211 $ 11,711 Investments 45,160 — 16,340 61,500 20,500 — 20,500 Observable price changes (1) 41,502 28,539 — 70,041 40,321 534 40,855 Exercises 96,719 (30,089) — 66,630 — — — Sales — — — — (14,546) — (14,546) Balance, end of period $ 264,156 $ 1,195 $ 16,340 $ 281,691 $ 55,775 $ 2,745 $ 58,520 Inception to date Strategic investments Warrants Call options Total Investments $ 97,728 $ 2,588 $ 16,340 $ 116,656 Observable price changes (1) 84,255 28,696 — 112,951 Exercises 96,719 (30,089) — 66,630 Sales (14,546) — — (14,546) Balance, end of period $ 264,156 $ 1,195 $ 16,340 $ 281,691 (1) Includes a realized gain of $12.3 million for the six months ended June 30, 2021. During the three months ended June 30, 2022, we made minority, non-controlling investments in Dedrone, Inc., Fusus, Inc., and DroneSense, Inc. for $25.0 million, $21.0 million, and $15.0 million, respectively. We were also issued warrants that give us the ability to purchase additional preferred stock, and call options to acquire all of the outstanding equity for each of these investments. During the six months ended June 30, 2022, certain of our strategic investees issued new equity to us and/or other investors. These events represented observable price changes for our existing investments and related warrants, resulting in a net unrealized gain of $70.0 million. In addition, we exercised warrants in one of our strategic investees for a total exercise price of $6.6 million, resulting in an unrealized gain of $60.1 million that was recognized in earnings for the quarter ended June 30, 2022. The estimated fair value of the investments were calculated using valuation techniques that included both observable and unobservable inputs. This estimated fair value reflects a value that was lower than the issue per share of the new equity issued by the strategic investees because of different characteristics of the newly issued equity instruments compared to our existing investments. The valuation techniques included both Level 2 and Level 3 inputs as defined by ASC Topic 820. |
Accrued Liabilities
Accrued Liabilities | 6 Months Ended |
Jun. 30, 2022 | |
Accrued Liabilities | |
Accrued Liabilities | Note 8 - Accrued Liabilities Accrued liabilities consisted of the following at June 30, 2022 and December 31, 2021 (in thousands): June 30, 2022 December 31, 2021 Accrued salaries, benefits and bonus $ 53,360 $ 62,425 Accrued professional, consulting and lobbying fees 6,907 7,152 Accrued warranty expense 1,628 2,822 Accrued income and other taxes 6,420 3,736 Accrued inventory in transit 9,625 9,945 Other accrued expenses 23,040 17,627 Accrued liabilities $ 100,980 $ 103,707 |
Income Taxes
Income Taxes | 6 Months Ended |
Jun. 30, 2022 | |
Income Taxes | |
Income Taxes | Note 9 - Income Taxes We file income tax returns for federal purposes and in many states, as well as in multiple foreign jurisdictions. Our tax filings remain subject to examination by applicable tax authorities for a certain length of time, generally three to four years, but can be up to ten years in some jurisdictions following the tax year to which these filings relate. We have been previously notified that an income tax audit may commence for Axon Public Safety Southeast Asia LLC, our entity in Vietnam; however, there has been no audit activity to date. Deferred Tax Assets Net deferred income tax assets at June 30, 2022, primarily include R&D tax credits, stock-based compensation expense, deferred revenue, accruals and reserves, R&D capitalization, net of amortization and net operating losses, partially offset by accelerated depreciation expense, unrealized investment gains, and valuation allowance reserve. Our total net deferred tax assets at June 30, 2022 were $100.5 million. In preparing our condensed consolidated financial statements, management assesses the likelihood that its deferred tax assets will be realized from future taxable income. In evaluating our ability to recover our deferred income tax assets, management considers all available positive and negative evidence, including our operating results, ongoing tax planning and forecasts of future taxable income on a jurisdiction by jurisdiction basis. A valuation allowance is established if it is determined that it is more likely than not that some portion or all of the net deferred tax assets will not be realized. Management exercises significant judgment in determining our provision for income taxes, our deferred tax assets and liabilities, and our future taxable income for purposes of assessing our ability to utilize any future tax benefit from our deferred tax assets. As of June 30, 2022, management continues to believe the positive evidence from projected future earnings outweighs the negative evidence and a valuation allowance is not needed. We have concluded that a valuation allowance is necessary against unrealized investment losses and related costs incurred in connection with certain investments. Additionally, we do have Arizona R&D tax credits expiring unutilized each year; therefore, management has concluded that it is more likely than not that our Arizona R&D deferred tax asset will not be realized, and a valuation allowance has been recorded against this net asset. In Australia, we have determined that sufficient deferred tax liabilities will reverse in order to realize all assets except one long-lived intangible where there is not an expectation that the asset may be realized. Therefore, we continue to recognize a partial valuation allowance for Australia. We complete R&D tax credit studies for each year that an R&D tax credit is claimed for federal and state income tax purposes. Management has made the determination that it is more likely than not that the full benefit of the R&D tax credit will not be sustained on examination and recorded a liability for unrecognized tax benefits of $19.6 million as of June 30, 2022. Should the unrecognized benefit of $19.6 million be recognized, our effective tax rate would be favorably impacted. Approximately $10.9 million of the unrecognized tax benefit associated with R&D credits has been netted against the R&D deferred tax asset. Effective Tax Rate Our overall effective tax rate for the six months ended June 30, 2022, after discrete period adjustments, was 24.9%. Before discrete adjustments, the tax rate was 26.0%, which differs from the federal statutory rate, primarily due to the impact of R&D tax credits offset by the executive compensation limitation under Internal Revenue Code ("IRC") Section 162(m) and an increase in valuation allowance and unrecognized tax benefits, on projected pre-tax income for the year. The effective tax rate was favorably impacted by a $1.6 million discrete tax benefit primarily associated with windfalls related to stock-based compensation for restricted stock units (“RSUs”) and performance stock units (“PSUs”) that vested during the six months ended June 30, 2022. |
Stockholders' Equity
Stockholders' Equity | 6 Months Ended |
Jun. 30, 2022 | |
Stockholders' Equity | |
Stockholders' Equity | Note 10 - Stockholders’ Equity Performance-based stock awards We have issued performance-based stock options and performance-based RSUs, the vesting of which is generally contingent upon the achievement of certain performance criteria related to our operating performance, as well as successful and timely development and market acceptance of future product introductions. In addition, certain of the performance RSUs have additional service requirements subsequent to the achievement of the performance criteria. Compensation expense is recognized over the requisite service period, which is defined as the longest explicit, implicit or derived service period based on management’s estimate of the probability of the performance criteria being satisfied, adjusted at each balance sheet date. For both service-based and performance-based RSUs, we account for forfeitures as they occur as a reduction to stock-based compensation expense and additional paid-in-capital. For performance-based options with a vesting schedule based entirely on the attainment of both performance and market conditions, stock-based compensation expense is recognized for each pair of performance and market conditions over the longer of the expected achievement period of the performance and market conditions, beginning at the point in time that the relevant performance condition is considered probable of achievement. The fair value of such awards is estimated on the grant date using Monte Carlo simulations. CEO Performance Award On May 24, 2018, our stockholders approved the Board of Directors’ grant of 6,365,856 stock option awards to Patrick W. Smith, our CEO (the “CEO Performance Award”). The CEO Performance Award consists of 12 vesting tranches with a vesting schedule based entirely on the attainment of both operational goals (performance conditions) and market capitalization goals (market conditions), assuming continued employment either as the CEO or as both Executive Chairman and Chief Product Officer and service through each attainment date. Each of the 12 vesting tranches of the CEO Performance Award have a 10-year contractual term and will vest upon certification by the Compensation Committee of the Board of Directors that both (i) the market capitalization goal for such tranche, which begins at $2.5 billion for the first tranche and increases by increments of $1.0 billion thereafter, and (ii) any one of the following eight operational goals focused on revenue or eight operational goals focused on Adjusted EBITDA have been met for the previous four consecutive fiscal quarters. Adjusted EBITDA for purposes of the CEO Performance Award ("Adjusted EBITDA (CEO Performance Award)") is defined as net income (loss) attributable to common stockholders before interest expense, interest and other income (such as dividends) earned on investments in marketable securities, provision (benefit) for income taxes, depreciation and amortization, and stock-based compensation expense. Revenue Goal (1) (in thousands) Achievement Status Adjusted EBITDA (in thousands) Achievement Status Goal #1, $710,058 Achieved Goal #1, $125,000 Achieved Goal #2, $860,058 Achieved Goal #2, $155,000 Achieved Goal #3, $1,010,058 Probable Goal #3, $175,000 Achieved Goal #4, $1,210,058 Probable Goal #4, $190,000 Achieved Goal #5, $1,410,058 Not Applicable Goal #5, $200,000 Achieved Goal #6, $1,610,058 Not Applicable Goal #6, $210,000 Achieved Goal #7, $1,810,058 Not Applicable Goal #7, $220,000 Achieved Goal #8, $2,010,058 Not Applicable Goal #8, $230,000 Achieved (1) In connection with the business acquisition that was completed during the three months ended September 30, 2018, the revenue goals were adjusted for the acquiree’s Target Revenue, as defined in the CEO Performance Award agreement. Stock-based compensation expense associated with the CEO Performance Award is recognized over the longer of the expected achievement period for each pair of market capitalization and operational goals, beginning at the point in time when the relevant operational goal is considered probable of being met. The probability of meeting an operational goal and the expected achievement point in time for meeting a probable operational goal are based on a subjective assessment of our forward-looking financial projections, taking into consideration statistical analysis. Even though no tranches of the CEO Performance Award vest unless a market capitalization and a matching operational goal are both achieved, stock-based compensation expense is recognized when an operational goal is considered probable of achievement regardless of whether a market capitalization goal is actually achieved. Stock-based compensation represents a non-cash expense and is recorded in sales, general, and administrative operating expense on our consolidated statements of operations and comprehensive income. The first ten market capitalization goals have been achieved as of June 30, 2022. As of June 30, 2022, 5.3 million stock options have been certified by the Compensation Committee and vested. As twelve operational goals have been achieved or are considered probable of achievement, we recorded stock-based compensation expense of $236.0 million related to the CEO Performance Award from the grant date through June 30, 2022. The number of stock options that would vest related to the remaining unvested tranches is approximately 1.1 million shares. As of June 30, 2022, we had $9.9 million of total unrecognized stock-based compensation expense for the performance goals that were considered probable of achievement, which will be recognized over a weighted-average period of 1.1 years eXponential Stock Performance Plan On February 12, 2019, our shareholders approved the 2019 Stock Incentive Plan (the “2019 Plan”), which was adopted by the Board of Directors to reserve a sufficient number of shares to facilitate our eXponential Stock Performance Plan (“XSPP”) and grants of eXponential Stock Units (“XSUs”) under the plan. Initial awards under the plan were granted in January 2019, with additional employee awards granted since that date. The XSUs are grants of Restricted Stock Units (“RSUs”), each with a term of approximately nine years, that vest in 12 equal tranches. Each of the 12 tranches will vest upon certification by the Compensation Committee of the Board of Directors that both (i) the market capitalization goal for such tranche, which begins at $2.5 billion for the first tranche and increases by increments of $1.0 billion thereafter, and (ii) any one of eight operational goals focused on revenue or eight operational goals focused on Adjusted EBITDA (CEO Performance Award) have been met for the previous four consecutive fiscal quarters. Beginning with the quarter ended June 30, 2021, new XSU grants are divided into a reduced number of tranches depending on employee eligibility and current market capitalization attainment. The XSPP contains an anti-dilution provision incorporated into the plan based on shareholder feedback, which affects the calculation of the market capitalization goals in the plan. The plan defines a maximum number of shares outstanding that may be used in the calculation of the market capitalization goals (the “XSU Maximum”). If the actual number of shares outstanding exceeds the XSU Maximum guardrail, then the lower pre-defined number of shares in the XSU Maximum, rather than the higher actual number of shares outstanding, is used to calculate market capitalization for the determination of the market capitalization goals in the XSPP, which, together with the operational goals, determines whether XSUs vest for participating employees. The XSU Maximum is defined as the actual number of shares outstanding on the original XSU grant date of January 2, 2019, increased by a 3% annual rate over the term of the XSPP and by shares issued upon the exercise of CEO Performance Award options. The XSU Maximum is also adjusted for acquisitions, spin-offs or other changes in the number of outstanding shares of common stock, if such changes have a corresponding adjustment on the market capitalization goals. New shares issued for any other reasons, including shares issued upon vesting of XSUs, RSUs, and Performance Stock Units (“PSUs”) as well as shares issued to raise capital through equity issuances or in other transactions, do not increase the XSU Maximum. The market capitalization and operational goals are identical to the CEO Performance Award, but a different number of shares is used to calculate the market capitalization goals if shares outstanding exceed the XSU Maximum. Additionally, because the grant date is different than that of the CEO Performance Award, the measurement period for market capitalization is not identical. As of June 30, 2022, actual shares outstanding exceeded the XSU Maximum. Accordingly, market capitalization as calculated for the purposes of achieving additional goals uses the lower XSU Maximum share amount rather than actual shares outstanding. The first nine market capitalization goals have been achieved as of June 30, 2022. The tenth market capitalization goal has not yet been attained, though the related operational goal was achieved as of September 30, 2021. As all twelve operational goals have been achieved or are considered probable of achievement, we recorded stock-based compensation expense of $180.8 million related to the XSU awards from their respective grant dates through June 30, 2022. The number of XSU awards that would vest related to the remaining three tranches is approximately 1.2 million shares. As of June 30, 2022, we had $14.8 million of total unrecognized stock-based compensation expense, which will be recognized over a weighted-average period of 1.6 years. Restricted Stock Units The following table summarizes RSU activity for the six months ended June 30, 2022 (number of units and aggregate intrinsic value in thousands): Number of Weighted Average Aggregate Units Grant-Date Fair Value Intrinsic Value Units outstanding, beginning of year 1,115 $ 133.40 Granted 324 121.16 Released (170) 77.07 Forfeited (103) 137.01 Units outstanding, end of period 1,166 137.85 $ 108,680 Aggregate intrinsic value represents our closing stock price on the last trading day of the period, which was $93.17 multiplied by the number of RSUs outstanding. As of June 30, 2022, there was $118.2 million in unrecognized compensation costs related to RSUs under our stock plans for shares that are expected to vest. We expect to recognize the cost related to the RSUs over a weighted average period of 2.1 years. RSUs are released when vesting requirements are met. Certain RSUs that vested in the six months ended June 30, 2022 were net-share settled such that we withheld shares to cover the employees’ tax obligation for the applicable income and other employment taxes, and remitted the cash to the appropriate taxing authorities. Total shares withheld related to RSUs were approximately seven thousand and had a value of $0.9 million on their respective vesting dates as determined by the closing stock price on such dates. Payments for the employees’ tax obligations are reflected as a financing activity within the condensed consolidated statements of cash flows. We record a liability for the tax withholding to be paid by us as a reduction to additional paid-in capital. Performance Stock Units The following table summarizes PSU activity, inclusive of XSUs, for the six months ended June 30, 2022 (number of units and aggregate intrinsic value in thousands): Number of Weighted Average Aggregate Units Grant-Date Fair Value Intrinsic Value Units outstanding, beginning of year 1,499 $ 39.86 Granted 88 114.78 Released (33) 118.08 Forfeited (166) 28.78 Units outstanding, end of period 1,388 44.06 $ 129,308 Aggregate intrinsic value represents our closing stock price on the last trading day of the period, which was $93.17 per share, multiplied by the number of PSUs outstanding. As of June 30, 2022, there was $23.7 million in unrecognized compensation costs related to PSUs under our stock plans for shares that are expected to vest. We expect to recognize the cost related to the PSUs over a weighted average period of 1.6 years. PSUs are released when vesting requirements are met. As of June 30, 2022, the performance criteria had been met for approximately twenty thousand of the 1.4 million PSUs outstanding. Certain PSUs that vested in the six months ended June 30, 2022 were net-share settled such that we withheld shares to cover the employees’ tax obligation for the applicable income and other employment taxes, and remitted the cash to the appropriate taxing authorities. Total shares withheld related to PSUs were approximately twelve thousand and had a value of $1.4 million on their respective vesting dates as determined by the closing stock price on such dates. Payments for the employees’ tax obligations are reflected as a financing activity within the condensed consolidated statements of cash flows. We record a liability for the tax withholding to be paid by us as a reduction to additional paid-in capital. Stock Option Activity The following table summarizes stock option activity for the six months ended June 30, 2022 (number of units and aggregate intrinsic value in thousands): Weighted Weighted Average Number Average Remaining of Exercise Contractual Aggregate Options Price Life (years) Intrinsic Value Options outstanding, beginning of year 2,438 $ 28.58 Granted — — Exercised — — Expired / terminated — — Options outstanding, end of period 2,438 28.58 5.66 $ 157,468 Options exercisable, end of period 1,377 28.58 5.66 88,939 Aggregate intrinsic value represents the difference between the exercise price of the underlying stock option awards and the closing market price of our common stock of $93.17 on June 30, 2022. There were no options exercised for the six months ended June 30, 2022. As of June 30, 2022, total options outstanding included 1.1 million unvested performance-based stock options, which relate to the CEO Performance Award and are probable of achievement. Stock-based Compensation Expense The following table summarizes the composition of stock-based compensation expense for the three months ended June 30, 2022 and 2021 (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2022 2021 2022 2021 Cost of products sold and services delivered $ 1,066 $ 1,838 $ 2,174 $ 3,327 Sales, general and administrative expenses 8,610 114,089 21,592 185,104 Research and development expenses 11,486 21,622 22,484 38,728 Total stock-based compensation expense $ 21,162 $ 137,549 $ 46,250 $ 227,159 Stock Incentive Plan In May 2022, our shareholders approved the Axon Enterprise, Inc. 2022 Stock Incentive Plan (the “2022 Plan”) authorizing an additional 2.5 million shares, plus remaining available shares under prior plans, for issuance under the new plan. Combined with the 2019 Plan and other legacy stock incentive plans, there are 3.4 million shares available for grant as of June 30, 2022. Stock Inducement Plan In September 2019, our Board of Directors adopted the Axon Enterprise, Inc. 2019 Stock Inducement Plan (the “2019 Inducement Plan”) pursuant to which we reserved 500,000 shares of common stock for issuance under the Inducement Plan. In accordance with Rule 5635(c)(4) and Rule 5635(c)(3) of the Nasdaq Listing Rules, awards under the Inducement Plan may only be made to individuals not previously employed by us (or following such individuals’ bona fide periods of non-employment by us), as an inducement material to the individuals’ entry into employment with us. The terms and conditions of the 2019 Inducement Plan are substantially similar to our stockholder-approved 2019 Plan and 2022 Plan. On April 6, 2022, we granted 29,507 shares from the 2019 Inducement Plan to new employees who joined the Company as a result of an acquisition. As of June 30, 2022, there were less than one hundred shares available for grant under the 2019 Inducement Plan. Stock Repurchase Plan In February 2016, our Board of Directors authorized a stock repurchase program to acquire up to $50.0 million of our outstanding common stock subject to stock market conditions and corporate considerations. During the three months ended June 30, 2022 and 2021, no common shares were purchased under the program. As of June 30, 2022, $16.3 million remains available under the plan for future purchases. Any future purchases will be discretionary. At-the-Market equity offering During the year ended December 31, 2021, we sold 577,956 shares of our common stock under our "at-the-market" equity offering program (the “ATM”). We generated approximately $107.6 million in aggregate gross proceeds from sales under the ATM. Aggregate net proceeds from the ATM were $105.4 million after deducting related expenses, including commissions to the sales agent of $1.6 million and issuance costs of $0.5 million. We may sell up to a total of 3.0 million shares of our common stock under the ATM. The ATM expires on April 20, 2024. We intend to use the net proceeds from this offering for general corporate purposes, which may include, among other things, providing capital to satisfy a portion of the tax obligations related to the vesting and settlement of stock compensation awards granted to our executive officers and other employees under our stock incentive plans, to support our growth, and to acquire or invest in product lines, products, services, technologies or facilities. |
Line of Credit
Line of Credit | 6 Months Ended |
Jun. 30, 2022 | |
Line of Credit. | |
Line of Credit | Note 11 - Line of Credit We have a $50.0 million unsecured revolving line of credit with a domestic bank, of which $20.0 million is available for letters of credit. The credit agreement matures on December 31, 2023 and has an accordion feature which allows for an increase in the total line of credit up to $100.0 million, subject to certain conditions, including the availability of additional bank commitments. At June 30, 2022 and December 31, 2021, there were no borrowings under the line. Under the terms of the line of credit, available borrowings are reduced by outstanding letters of credit. As of June 30, 2022, we had letters of credit outstanding of approximately $6.5 million under the facility and available borrowing of $43.5 million, excluding amounts available under the accordion feature. Advances under the line of credit bear interest at LIBOR plus 1.0 to 1.5% per year determined in accordance with a pricing grid based on our funded debt to earnings before interest, taxes, depreciation and amortization ("EBITDA") ratio. We are required to comply with a maximum funded debt to EBITDA ratio of no greater than 2.50 to 1.00 based upon a trailing four fiscal quarter period. At June 30, 2022, our funded debt to EBITDA ratio was 0.00 to 1.00. |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Jun. 30, 2022 | |
Commitments and Contingencies. | |
Commitments and Contingencies | Note 12 - Commitments and Contingencies Data Storage Renewal Commitment In June 2022, we entered into a purchase agreement for cloud hosting with a six year term beginning July 1, 2022. The purchase agreement includes a total commitment of $425.0 million. Product Litigation As a manufacturer of weapons and other law enforcement tools used in high-risk field environments, we are often the subject of products liability litigation concerning the use of our products. We are currently named as a defendant in three lawsuits in which the plaintiffs allege either wrongful death or personal injury in situations in which a TASER CED was used by law enforcement officers in connection with arrests or training. While the facts vary from case to case, these product liability claims typically allege defective product design, manufacturing, and/or failure to warn. They seek compensatory and sometimes punitive damages, often in unspecified amounts. We continue to aggressively defend all product litigation. As a general rule, it is our policy not to settle suspect injury or death cases. Exceptions are sometimes made where the settlement is strategically beneficial to us. Due to the confidential nature of our litigation strategy and the confidentiality agreements that are executed in the event of a settlement, we do not identify or comment on specific settlements by case or amount. Based on current information, we do not believe that the outcome of any such legal proceeding will have a material effect on our financial position, results of operations, or cash flows. We are self-insured for the first $5.0 million of any product claim made after 2014. No judgment or settlement has ever exceeded this amount in any products case. We continue to maintain product liability insurance coverage, including an insurance policy fronting arrangement, above our self-insured retention with various limits depending on the policy period. The litigation information in this note is current through the date of these financial statements. U.S. Federal Trade Commission Litigation The U.S. Federal Trade Commission (“FTC”) filed an administrative enforcement action in January 2020 regarding our May 2018 acquisition of an insolvent body worn camera competitor, Vievu LLC. The FTC alleges the merger was anticompetitive and adversely affected the BWC and digital evidence management market for “large metropolitan police departments,” which we deny. The administrative hearing remains stayed pending our federal court constitutional challenges to the FTC’s structure and administrative processes. Even if we ultimately are required to divest Vievu and other assets, any such result will not interfere with our ability to meet contractual obligations or implement our solutions. Prior to the FTC’s enforcement action, we sued the FTC in federal court in the District of Arizona for declaratory and injunctive relief alleging the FTC’s structure and administrative processes violate Article II of the U.S. Constitution and our Fifth Amendment rights to due process and equal protection. The district court dismissed the action, without prejudice, for lack of jurisdiction. The Ninth Circuit affirmed in a split decision but granted our motion to stay the appellate mandate pending the filing of its petition for certiorari with the U.S. Supreme Court. On January 24, 2022, the Supreme Court granted our petition. Merits briefing is now in process with oral argument set for November 7, 2022. The FTC’s administrative case will remain stayed pending resolution of the Supreme Court proceedings. In parallel to these matters, we are evaluating strategic alternatives to litigation, which we might pursue if determined to be in the best interests of shareholders and customers. This could include a divestiture of the Vievu entity and/or related assets and the licensure of certain intellectual and other intangible property. While we continue to believe the acquisition of Vievu was lawful and a benefit to Vievu’s customers, the cost, risk and distraction of protracted litigation merit consideration of settlement if achievable on terms agreeable to the FTC and Axon. General From time to time, we are notified that we may be a party to a lawsuit or that a claim is being made against us. It is our policy to not disclose the specifics of any claim or threatened lawsuit until the summons and complaint are actually served on us. After carefully assessing the claim, and assuming we determine that we are not at fault or we disagree with the damages or relief demanded, we vigorously defend any lawsuit filed against us. We record a liability when losses are deemed probable and reasonably estimable. When losses are deemed reasonably possible but not probable, we determine whether it is possible to provide an estimate of the Based on our assessment of outstanding litigation and claims as of June 30, 2022, we have determined that it is not reasonably possible that these lawsuits will individually, or in the aggregate, materially affect our results of operations, financial condition or cash flows. However, the outcome of any litigation is inherently uncertain and there can be no assurance that any expense, liability or damages that may ultimately result from the resolution of these matters will be covered by our insurance or will not be in excess of amounts recognized or provided by insurance coverage and will not have a material adverse effect on our operating results, financial condition or cash flows. Off-Balance Sheet Arrangements Under certain circumstances, we use letters of credit and surety bonds to guarantee our performance under various contracts, principally in connection with the installation and integration of Axon cameras and related technologies. Certain of our letters of credit and surety bonds have stated expiration dates with others being released as the contractual performance terms are completed. At June 30, 2022, we had outstanding letters of credit of $6.5 million that are expected to expire throughout 2023. We also had outstanding letters of credit of $0.4 million that do not draw against our credit facility. The outstanding letters of credit that do not draw against our credit facility are expected to expire in May 2023. Additionally, we had $21.1 million of outstanding surety bonds at June 30, 2022, with $3.1 million expiring in 2022, $7.5 million expiring in 2023 and the remaining $10.5 million expiring in 2024. |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Income (loss) | 6 Months Ended |
Jun. 30, 2022 | |
Accumulated Other Comprehensive Income (loss). | |
Accumulated Other Comprehensive Income (loss) | Note 13 – Accumulated Other Comprehensive Income (loss) The following tables reflect the changes in accumulated other comprehensive income (loss), net of tax (in thousands): Unrealized Gains (Losses) on Available-for-Sale Foreign Currency Investments Translation Total Balance, December 31, 2021 $ (207) $ (1,110) $ (1,317) Other comprehensive loss (489) (1,072) (1,561) Balance, March 31, 2022 $ (696) $ (2,182) $ (2,878) Other comprehensive loss (161) (2,166) (2,327) Balance, June 30, 2022 $ (857) $ (4,348) $ (5,205) Unrealized Gains (Losses) on Available-for-Sale Foreign Currency Investments Translation Total Balance, December 31, 2020 $ — $ 141 $ 141 Other comprehensive income — 1 1 Balance, March 31, 2021 $ — $ 142 $ 142 Other comprehensive loss — (369) (369) Balance, June 30, 2021 $ — $ (227) $ (227) |
Employee Benefit Plans
Employee Benefit Plans | 6 Months Ended |
Jun. 30, 2022 | |
Employee Benefit Plans | |
Employee Benefit Plans | Note 14 - Employee Benefit Plans We have a defined contribution 401(k) plan for eligible employees, which is qualified under Sections 401(a) and 401(k) of the Internal Revenue Code of 1986, as amended. Employees are entitled to make tax-deferred contributions of up to the maximum amount allowed by law of their eligible compensation. Contributions to the plan are made by both the employee and us. Our contributions to the 401(k) plan are based on the level of employee contributions and are immediately vested. Future matching contributions to the plans are at our sole discretion. We also sponsor defined contribution plans in Australia, Canada, Finland, and the United Kingdom. Our matching contributions for all defined contribution plans were $2.3 million and $1.8 million for the three months ended June 30, 2022 and 2021, respectively, and $5.4 million and $3.8 million for the six months ended June 30, 2022 and 2021, respectively. |
Segment Data
Segment Data | 6 Months Ended |
Jun. 30, 2022 | |
Segment Data | |
Segment Data | Note 15 - Segment Data Our operations are comprised of two reportable segments: the TASER segment and the Software and Sensors segment. Information relative to our reportable segments was as follows (in thousands): Three Months Ended June 30, 2022 Three Months Ended June 30, 2021 Software and Software and TASER Sensors Total TASER Sensors Total Net sales from products $ 131,721 $ 68,330 $ 200,051 $ 110,637 $ 45,790 $ 156,427 Net sales from services 3,865 81,697 85,562 1,891 60,477 62,368 Net sales 135,586 150,027 285,613 112,528 106,267 218,795 Cost of product sales 48,463 39,039 87,502 37,701 27,600 65,301 Cost of service sales — 24,148 24,148 145 15,420 15,565 Cost of sales 48,463 63,187 111,650 37,846 43,020 80,866 Gross margin $ 87,123 $ 86,840 $ 173,963 $ 74,682 $ 63,247 $ 137,929 Research and development $ 13,316 $ 44,231 $ 57,547 $ 12,313 $ 41,639 $ 53,952 Six Months Ended June 30, 2022 Six Months Ended June 30, 2021 Software and Software and TASER Sensors Total TASER Sensors Total Net sales from products $ 242,875 $ 133,380 $ 376,255 $ 207,939 89,374 $ 297,313 Net sales from services 7,071 158,713 165,784 3,588 112,913 116,501 Net sales 249,946 292,093 542,039 211,527 202,287 413,814 Cost of product sales 89,088 77,766 166,854 70,646 53,271 123,917 Cost of service sales — 45,483 45,483 145 28,470 28,615 Cost of sales 89,088 123,249 212,337 70,791 81,741 152,532 Gross margin $ 160,858 $ 168,844 $ 329,702 $ 140,736 $ 120,546 $ 261,282 Research and development $ 23,212 $ 82,751 $ 105,963 $ 21,556 $ 79,414 $ 100,970 |
Organization and Summary of S_2
Organization and Summary of Significant Accounting Policies (Policies) | 6 Months Ended |
Jun. 30, 2022 | |
Organization and Summary of Significant Accounting Policies | |
Basis of Presentation and Use of Estimates | Basis of Presentation and Use of Estimates These unaudited condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the SEC. Certain information related to our organization, significant accounting policies and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”) has been condensed or omitted. The accounting policies followed in the preparation of these unaudited condensed consolidated financial statements are consistent with those followed in our annual consolidated financial statements for the year ended December 31, 2021, as filed on Form 10-K, with the exception of our adoption of certain accounting pronouncements which we describe below. In the opinion of management, these unaudited condensed consolidated financial statements contain all material adjustments, consisting only of normal recurring adjustments, necessary to fairly state our financial position, results of operations and cash flows for the periods presented and the presentations and disclosures herein are adequate when read in conjunction with our Form 10-K for the year ended December 31, 2021. The results of operations for the three months and six months ended June 30, 2022 are not necessarily indicative of the results to be expected for the full year (or any other period). Significant estimates and assumptions in these unaudited condensed consolidated financial statements include: ● product warranty reserves, ● inventory valuation, ● revenue recognition, ● reserve for expected credit loss, ● valuation of goodwill, intangible and long-lived assets, ● valuation of strategic investments, ● recognition, measurement and valuation of current and deferred income taxes, ● stock-based compensation, and ● recognition and measurement of contingencies and accrued litigation expense. Actual results could differ materially from those estimates. |
Segment Information | Segment Information Our operations are comprised of two reportable segments: the manufacture and sale of conducted electrical devices ("CEDs"), batteries, accessories, extended warranties and other products and services (the “TASER” segment); and the development, manufacture, and sale of software and sensors, which includes the sale of devices, wearables, applications, cloud and mobile products, and services (collectively, the “Software and Sensors” segment). In both segments, we report sales of products and services. Service revenue in both segments includes sales related to Axon Evidence. In the Software and Sensors segment, service revenue also includes other recurring cloud-hosted software revenue and related professional services. Collectively, this revenue is sometimes referred to as "Axon Cloud revenue." Reportable segments are determined based on discrete financial information reviewed by our Chief Executive Officer who is our chief operating decision maker ("CODM"). We organize and review operations based on products and services, and currently there are no operating segments that are aggregated. We perform an analysis of our reportable segments at least annually. Additional information related to our business segments is summarized in Note 15. |
Geographic Information and Major Customers / Suppliers | Geographic Information and Major Customers / Suppliers For the three and six months ended June 30, 2022, no individual country outside the U.S. represented more than 10% of total net sales. Individual sales transactions in the international market are generally larger and occur more intermittently than in the domestic market due to the profile of our customers. For the three and six months ended June 30, 2022, no customer represented more than 10% of total net sales. At June 30, 2022 and December 31, 2021, no customer represented more than 10% of the aggregate balance of accounts and notes receivable and contract assets. We currently purchase both off the shelf and custom components, including, but not limited to, finished circuit boards, injection-molded plastic components, small machined parts, custom cartridge components, electronic components, and off the shelf sub-assemblies from suppliers located in the U.S., Canada, China, Republic of Korea, Malaysia, Mexico, Taiwan, and Vietnam. We may source from other countries as well. Although we currently obtain many of these components from single source suppliers, we own the injection molded component tooling, most of the designs, and the test fixtures used in their production for all custom components. As a result, we believe we could obtain alternative suppliers in most cases. Although we have experienced supply chain disruptions relating to materials and port constraints, we have remained focused on closely managing our supply chain. We continue to bolster our strategic relationships in our supply chain, identifying secondary/alternate sourcing, adjusting build plans accordingly, and building in logistic modes in support of our increasing demand while working to minimize disruption to customers. We acquire most of our components on a purchase order basis and do not currently have significant long-term purchase contracts with most component suppliers. |
Income per Common Share | Income per Common Share Basic income per common share is computed by dividing net income by the weighted average number of common shares outstanding during the periods presented. Diluted income per share reflects the potential dilution from outstanding stock options and unvested restricted stock units. The calculation of the weighted average number of shares outstanding and earnings per share are as follows (in thousands except per share data): Three Months Ended June 30, Six Months Ended June 30, 2022 2021 2022 2021 Numerator for basic and diluted earnings per share: Net income (loss) $ 50,962 $ (47,117) $ 105,833 $ (95,034) Denominator: Weighted average shares outstanding 71,040 65,166 70,995 64,604 Dilutive effect of stock-based awards 1,243 — 1,321 — Diluted weighted average shares outstanding 72,283 65,166 72,316 64,604 Anti-dilutive stock-based awards excluded 2,991 10,537 2,912 8,950 Net income (loss) per common share: Basic $ 0.72 $ (0.72) $ 1.49 $ (1.47) Diluted $ 0.71 $ (0.72) $ 1.46 $ (1.47) |
Standard Warranties | Standard Warranties We warranty our CEDs, Axon cameras and certain related accessories from manufacturing defects on a limited basis for a period of one year after purchase and, thereafter, will repair or replace any defective unit for a fee. Estimated costs for the standard warranty are charged to cost of products sold when revenue is recorded for the related product. Future warranty costs are estimated based on historical data related to warranty claims and this rate is applied to current product sales. Historically, reserve amounts have been increased if management becomes aware of a component failure or other issue that could result in larger than anticipated warranty claims from customers. The warranty reserve is reviewed quarterly to verify that it sufficiently reflects the remaining warranty obligations based on the anticipated expenditures over the balance of the warranty obligation period, and adjustments are made when actual warranty claim experience differs from estimates. The warranty reserve is included in accrued liabilities on the accompanying condensed consolidated balance sheets. Changes in our estimated product warranty liabilities were as follows (in thousands): Six Months Ended June 30, 2022 2021 Balance, beginning of period $ 2,822 $ 769 Utilization of reserve (1,574) (481) Warranty expense 380 613 Balance, end of period $ 1,628 $ 901 |
Fair Value Measurements and Financial Instruments | Fair Value Measurements and Financial Instruments We use the fair value framework that prioritizes the inputs to valuation techniques for measuring financial assets and liabilities measured on a recurring basis and for non-financial assets and liabilities when these items are re-measured. Fair value is considered to be the exchange price in an orderly transaction between market participants, to sell an asset or transfer a liability at the measurement date. The hierarchy below lists three levels of fair value based on the extent to which inputs used in measuring fair value are observable in the market. We categorize each of our fair value measurements in one of these three levels based on the lowest level input that is significant to the fair value measurement in its entirety. These levels are: ● Level 1 – Valuation techniques in which all significant inputs are unadjusted quoted prices from active markets for assets or liabilities that are identical to the assets or liabilities being measured. ● Level 2 – Valuation techniques in which significant inputs include quoted prices from active markets for assets or liabilities that are similar to the assets or liabilities being measured and/or quoted prices for assets or liabilities that are identical or similar to the assets or liabilities being measured from markets that are not active. Also, model-derived valuations in which all significant inputs and significant value drivers are observable in active markets are Level 2 valuation techniques. ● Level 3 – Valuation techniques in which one or more significant inputs or significant value drivers are unobservable. Unobservable inputs are valuation technique inputs that reflect our own assumptions about inputs that market participants would use in pricing an asset or liability. We have cash equivalents and investments, which at June 30, 2022 and December 31, 2021 were comprised of money market funds, commercial paper, corporate bonds, municipal bonds, U.S. Government agency bonds, and U.S. Treasury bills. See additional disclosure regarding the fair value of our cash equivalents and investments in Note 3. Included in the balance of other long-term assets as of June 30, 2022 and December 31, 2021 was $4.2 million and $5.3 million, respectively, related to corporate-owned life insurance policies which are used to fund our deferred compensation plan. We determine the fair value of insurance contracts by obtaining the cash surrender value of the contracts from the issuer, a Level 2 valuation technique. We have an investment in marketable securities, for which c hanges in fair value are recorded in the condensed consolidated statement of operations as unrealized gain or (loss) on marketable securities, which is included in interest and other income, net. We have strategic investments in six unconsolidated affiliates as of June 30, 2022. The estimated fair value of the investments was determined based on Level 3 inputs. In determining the estimated fair value of our strategic investments in privately held companies, we utilize observable data available to us as discussed further in Note 7. Our financial instruments also include accounts and notes receivable, accounts payable and accrued liabilities. Due to the short-term nature of these instruments, their fair values approximate their carrying values on the condensed consolidated balance sheet. |
Restricted Cash | Restricted Cash Restricted cash balances as of June 30, 2022 were $1.9 million primarily related to funds held in an international bank account securing a guarantee and funds held in an international bank account for a country in which we are required to maintain a minimum balance to operate. Approximately $1.8 million was included in prepaid expenses and other current assets on our condensed consolidated balance sheet, with the remainder included in other long-term assets |
Valuation of Goodwill, Intangibles and Long-lived Assets | Valuation of Goodwill, Intangibles and Long-lived Assets We evaluate whether events and circumstances have occurred that indicate the remaining estimated useful life of long-lived assets and identifiable intangible assets, excluding goodwill and intangible assets with indefinite useful lives, may warrant revision or that the remaining balance of these assets may not be recoverable. Such circumstances could include, but are not limited to, a change in the product mix, a change in the way products are created, produced or delivered, or a significant change in the way products are branded and marketed. In performing the review for recoverability, we estimate the future undiscounted cash flows expected to result from the use of the assets and their eventual disposition. The amount of the impairment loss, if impairment exists, is calculated based on the excess of the carrying amounts of the assets over their estimated fair value computed using discounted cash flows. We do not amortize goodwill and intangible assets with indefinite useful lives; rather such assets are required to be tested for impairment at least annually or sooner whenever events or changes in circumstances indicate that the assets may be impaired. We perform our annual goodwill and intangible asset impairment tests in the fourth quarter of each year. |
Recently Issued Accounting Guidance | Recently Issued Accounting Guidance Recently Adopted Accounting Pronouncements In November 2021, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2021-10, Government Assistance (Topic 832). The guidance improves the transparency of government assistance accounting as it requires business entities to disclose transactions that involve government assistance received if the transactions were accounted for by applying a grant or contribution accounting model by analogy. The ASU is effective for annual periods beginning after December 15, 2021. We adopted ASU 2021-10 on January 1, 2022 and will apply the disclosure requirement prospectively to all transactions within the scope of the amendments that are reflected in the financial statements at the date of the initial application along with new transactions that are entered into after the date of initial application. Adoption of this ASU did not have a material impact on our consolidated financial statements. |
Reclassification of Prior Year Presentation | Reclassification of Prior Year Presentation Certain prior year amounts have been reclassified for consistency with the current year presentation. These reclassifications are not material and had no effect on the reported results of operations. |
Organization and Summary of S_3
Organization and Summary of Significant Accounting Policies (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Organization and Summary of Significant Accounting Policies | |
Schedule of weighted average number of shares outstanding and earnings per share | Three Months Ended June 30, Six Months Ended June 30, 2022 2021 2022 2021 Numerator for basic and diluted earnings per share: Net income (loss) $ 50,962 $ (47,117) $ 105,833 $ (95,034) Denominator: Weighted average shares outstanding 71,040 65,166 70,995 64,604 Dilutive effect of stock-based awards 1,243 — 1,321 — Diluted weighted average shares outstanding 72,283 65,166 72,316 64,604 Anti-dilutive stock-based awards excluded 2,991 10,537 2,912 8,950 Net income (loss) per common share: Basic $ 0.72 $ (0.72) $ 1.49 $ (1.47) Diluted $ 0.71 $ (0.72) $ 1.46 $ (1.47) |
Summary of changes in our estimated warranty reserve | Changes in our estimated product warranty liabilities were as follows (in thousands): Six Months Ended June 30, 2022 2021 Balance, beginning of period $ 2,822 $ 769 Utilization of reserve (1,574) (481) Warranty expense 380 613 Balance, end of period $ 1,628 $ 901 |
Revenues (Tables)
Revenues (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Revenues | |
Summary of Revenue by Product and Service Offering and Geography | The following tables present our revenues by primary product and service offering (in thousands): Three Months Ended June 30, 2022 Three Months Ended June 30, 2021 Software and Software and TASER Sensors Total TASER Sensors Total TASER 7 $ 53,440 $ — $ 53,440 $ 28,128 — $ 28,128 TASER X26P 12,339 — 12,339 9,569 — 9,569 TASER X2 4,534 — 4,534 16,145 — 16,145 TASER Consumer devices 1,687 — 1,687 1,701 — 1,701 Cartridges 49,845 — 49,845 46,678 — 46,678 Axon Body — 27,468 27,468 — 19,927 19,927 Axon Flex — 621 621 — 1,088 1,088 Axon Fleet — 15,881 15,881 — 5,247 5,247 Axon Dock — 5,849 5,849 — 5,509 5,509 Axon Evidence and cloud services 3,720 81,911 85,631 1,702 60,367 62,069 Extended warranties 7,459 12,498 19,957 5,857 8,149 14,006 Other 2,562 5,799 8,361 2,748 5,980 8,728 Total $ 135,586 $ 150,027 $ 285,613 $ 112,528 $ 106,267 $ 218,795 Six Months Ended June 30, 2022 Six Months Ended June 30, 2021 Software and Software and TASER Sensors Total TASER Sensors Total TASER 7 $ 103,506 $ — $ 103,506 $ 62,119 — $ 62,119 TASER X26P 21,818 — 21,818 19,532 — 19,532 TASER X2 8,153 — 8,153 28,923 — 28,923 TASER Pulse 3,383 — 3,383 3,906 — 3,906 Cartridges 87,670 — 87,670 77,096 — 77,096 Axon Body — 57,176 57,176 — 39,683 39,683 Axon Flex — 1,950 1,950 — 1,993 1,993 Axon Fleet — 29,701 29,701 — 9,010 9,010 Axon Dock — 13,329 13,329 — 12,429 12,429 Axon Evidence and cloud services 6,737 161,850 168,587 3,098 112,661 115,759 Extended warranties 14,138 21,559 35,697 11,503 15,649 27,152 Other 4,541 6,528 11,069 5,350 10,862 16,212 Total $ 249,946 $ 292,093 $ 542,039 $ 211,527 $ 202,287 $ 413,814 The following table presents our revenues disaggregated by geography (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2022 2021 2022 2021 United States $ 228,446 80 % $ 164,908 75 % $ 442,660 82 % $ 325,294 79 % Other countries 57,167 20 53,887 25 99,379 18 88,520 21 Total $ 285,613 100 % $ 218,795 100 % $ 542,039 100 % $ 413,814 100 % |
Contract with Customer, Assets and Liabilities | The following table presents our contract assets, contract liabilities and certain information related to these balances as of and for the six months ended June 30, 2022 (in thousands): June 30, 2022 Contract assets, net $ 224,994 Contract liabilities (deferred revenue) 522,662 Revenue recognized in the period from: Amounts included in contract liabilities at the beginning of the period 172,675 Contract liabilities (deferred revenue) consisted of the following (in thousands): June 30, 2022 December 31, 2021 Current Long-Term Total Current Long-Term Total Warranty: TASER $ 16,038 $ 18,222 $ 34,260 $ 21,257 $ 4,766 $ 26,023 Software and Sensors 19,736 22,078 41,814 23,175 18,137 41,312 35,774 40,300 76,074 44,432 22,903 67,335 Hardware: TASER 26,579 20,016 46,595 12,944 28,727 41,671 Software and Sensors 47,149 94,855 142,004 34,862 81,223 116,085 73,728 114,871 188,599 47,806 109,950 157,756 Services: TASER 3,102 6,555 9,657 2,701 3,482 6,183 Software and Sensors 140,581 107,751 248,332 170,652 49,386 220,038 143,683 114,306 257,989 173,353 52,868 226,221 Total $ 253,185 $ 269,477 $ 522,662 $ 265,591 $ 185,721 $ 451,312 June 30, 2022 December 31, 2021 Current Long-Term Total Current Long-Term Total TASER $ 45,719 $ 44,793 $ 90,512 $ 36,902 $ 36,975 $ 73,877 Software and Sensors 207,466 224,684 432,150 228,689 148,746 377,435 Total $ 253,185 $ 269,477 $ 522,662 $ 265,591 $ 185,721 $ 451,312 |
Cash, Cash Equivalents and In_2
Cash, Cash Equivalents and Investments (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Cash, Cash Equivalents and Investments | |
Summary of Cash, Cash Equivalents, Marketable Securities, and Available-for-Sale Investments | The following tables summarize our cash, cash equivalents, marketable securities, and available-for-sale investments at June 30, 2022 and December 31, 2021 (in thousands): As of June 30, 2022 Gross Gross Cash and Amortized Unrealized Unrealized Cash Marketable Short-Term Long-Term Cost Gains Losses Fair Value Equivalents Securities Investments Investments Cash $ 155,582 $ — $ — $ 155,582 $ 155,582 $ — $ — $ — Level 1: Money market funds 43,550 — — 43,550 43,550 — — — Agency bonds 26,601 5 (2) 26,604 8,484 — 18,120 — Treasury bills 28,390 — (24) 28,366 — — 22,690 5,676 Marketable securities 90,000 — (44,100) 45,900 — 45,900 — — Subtotal 188,541 5 (44,126) 144,420 52,034 45,900 40,810 5,676 Level 2: State and municipal obligations 5,814 1 (35) 5,780 — — 4,257 1,523 Corporate bonds 57,609 11 (1,027) 56,593 5,199 — 33,668 17,726 Commercial paper 39,779 — — 39,779 — — 39,779 — Subtotal 103,202 12 (1,062) 102,152 5,199 — 77,704 19,249 Total $ 447,325 $ 17 $ (45,188) $ 402,154 $ 212,815 $ 45,900 $ 118,514 $ 24,925 As of December 31, 2021 Gross Gross Cash and Amortized Unrealized Unrealized Cash Marketable Short-Term Long-Term Cost Gains Losses Fair Value Equivalents Securities Investments Investments Cash $ 353,488 $ — $ — $ 353,488 $ 353,488 $ — $ — $ — Level 1: Money market funds 2,844 — — 2,844 2,844 — — — Agency bonds 10,700 4 — 10,704 — — 10,704 — Marketable securities 90,000 — (17,820) 72,180 — 72,180 — — Subtotal 103,544 4 (17,820) 85,728 2,844 72,180 10,704 — Level 2: State and municipal obligations 2,570 — (5) 2,565 — — 1,400 1,165 Corporate bonds 32,748 1 (276) 32,473 — — 2,406 30,067 Subtotal 35,318 1 (281) 35,038 — — 3,806 31,232 Total $ 492,350 $ 5 $ (18,101) $ 474,254 $ 356,332 $ 72,180 $ 14,510 $ 31,232 |
Expected Credit Losses (Tables)
Expected Credit Losses (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Expected Credit Losses | |
Schedule of roll-forward of allowance for credit losses | The following table provides a roll-forward of the allowance for expected credit losses that is deducted from the amortized cost basis of accounts receivable, notes receivable, and contract assets to present the net amount expected to be collected (in thousands): Six Months Ended June 30, 2022 United States Other countries Total Balance, beginning of period $ 3,171 $ 178 $ 3,349 Provision for expected credit losses (50) 233 183 Amounts written off charged against the allowance (396) - (396) Other, including foreign currency translation - (3) (3) Balance, end of period $ 2,725 $ 408 $ 3,133 |
Schedule of allowance for expected credit losses for each type of customer receivable | June 30, December 31, 2022 2021 Accounts receivable and notes receivable, current $ 1,927 $ 2,203 Contract assets, net 1,058 1,010 Long-term notes receivable, net of current portion 148 136 Total allowance for expected credit losses on customer receivables $ 3,133 $ 3,349 |
Inventory (Tables)
Inventory (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Inventory | |
Inventory | Inventory consisted of the following at June 30, 2022 and December 31, 2021 (in thousands): June 30, 2022 December 31, 2021 Raw materials $ 50,995 $ 38,267 Finished goods 103,302 70,421 Total inventory $ 154,297 $ 108,688 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Property and Equipment | |
Summary of Property and Equipment | Property and equipment consisted of the following (in thousands): Estimated Useful Life June 30, 2022 December 31, 2021 Land N/A $ 51,612 $ 54,868 Land held for sale N/A 3,173 — Building and leasehold improvements 3-39 years 26,745 25,712 Production equipment 3-5 years 54,879 54,090 Computers, equipment and software 3-5 years 21,338 15,343 Furniture and office equipment 3-5 years 7,407 6,838 Vehicles 5 years 3,624 2,932 Website development costs 3 years 204 204 Capitalized internal-use software development costs 3-5 years 13,994 11,996 Construction-in-process N/A 42,904 25,258 Total cost 225,880 197,241 Less: Accumulated depreciation (67,964) (58,784) Property and equipment, net $ 157,916 $ 138,457 |
Strategic Investments (Tables)
Strategic Investments (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Strategic Investments | |
Schedule of Roll-Forward of Strategic Investments | The following tables provide a roll-forward of the balance of strategic investments (in thousands): Six Months Ended June 30, 2022 Six Months Ended June 30, 2021 Strategic investments Warrants Call options Total Strategic investments Warrants Total Balance, beginning of period $ 80,775 $ 2,745 $ — $ 83,520 $ 9,500 $ 2,211 $ 11,711 Investments 45,160 — 16,340 61,500 20,500 — 20,500 Observable price changes (1) 41,502 28,539 — 70,041 40,321 534 40,855 Exercises 96,719 (30,089) — 66,630 — — — Sales — — — — (14,546) — (14,546) Balance, end of period $ 264,156 $ 1,195 $ 16,340 $ 281,691 $ 55,775 $ 2,745 $ 58,520 Inception to date Strategic investments Warrants Call options Total Investments $ 97,728 $ 2,588 $ 16,340 $ 116,656 Observable price changes (1) 84,255 28,696 — 112,951 Exercises 96,719 (30,089) — 66,630 Sales (14,546) — — (14,546) Balance, end of period $ 264,156 $ 1,195 $ 16,340 $ 281,691 (1) Includes a realized gain of $12.3 million for the six months ended June 30, 2021. |
Accrued Liabilities (Tables)
Accrued Liabilities (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Accrued Liabilities | |
Schedule of Accrued liabilities | Accrued liabilities consisted of the following at June 30, 2022 and December 31, 2021 (in thousands): June 30, 2022 December 31, 2021 Accrued salaries, benefits and bonus $ 53,360 $ 62,425 Accrued professional, consulting and lobbying fees 6,907 7,152 Accrued warranty expense 1,628 2,822 Accrued income and other taxes 6,420 3,736 Accrued inventory in transit 9,625 9,945 Other accrued expenses 23,040 17,627 Accrued liabilities $ 100,980 $ 103,707 |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Stockholders' Equity | |
Equity Compensation Goals | Revenue Goal (1) (in thousands) Achievement Status Adjusted EBITDA (in thousands) Achievement Status Goal #1, $710,058 Achieved Goal #1, $125,000 Achieved Goal #2, $860,058 Achieved Goal #2, $155,000 Achieved Goal #3, $1,010,058 Probable Goal #3, $175,000 Achieved Goal #4, $1,210,058 Probable Goal #4, $190,000 Achieved Goal #5, $1,410,058 Not Applicable Goal #5, $200,000 Achieved Goal #6, $1,610,058 Not Applicable Goal #6, $210,000 Achieved Goal #7, $1,810,058 Not Applicable Goal #7, $220,000 Achieved Goal #8, $2,010,058 Not Applicable Goal #8, $230,000 Achieved (1) In connection with the business acquisition that was completed during the three months ended September 30, 2018, the revenue goals were adjusted for the acquiree’s Target Revenue, as defined in the CEO Performance Award agreement. |
Summary of Restricted Stock Unit Activity | The following table summarizes RSU activity for the six months ended June 30, 2022 (number of units and aggregate intrinsic value in thousands): Number of Weighted Average Aggregate Units Grant-Date Fair Value Intrinsic Value Units outstanding, beginning of year 1,115 $ 133.40 Granted 324 121.16 Released (170) 77.07 Forfeited (103) 137.01 Units outstanding, end of period 1,166 137.85 $ 108,680 |
Summary of Performance Stock Unit Activity | The following table summarizes PSU activity, inclusive of XSUs, for the six months ended June 30, 2022 (number of units and aggregate intrinsic value in thousands): Number of Weighted Average Aggregate Units Grant-Date Fair Value Intrinsic Value Units outstanding, beginning of year 1,499 $ 39.86 Granted 88 114.78 Released (33) 118.08 Forfeited (166) 28.78 Units outstanding, end of period 1,388 44.06 $ 129,308 |
Summary of the Company's Stock Options Activity | The following table summarizes stock option activity for the six months ended June 30, 2022 (number of units and aggregate intrinsic value in thousands): Weighted Weighted Average Number Average Remaining of Exercise Contractual Aggregate Options Price Life (years) Intrinsic Value Options outstanding, beginning of year 2,438 $ 28.58 Granted — — Exercised — — Expired / terminated — — Options outstanding, end of period 2,438 28.58 5.66 $ 157,468 Options exercisable, end of period 1,377 28.58 5.66 88,939 |
Reported Share-Based Compensation | The following table summarizes the composition of stock-based compensation expense for the three months ended June 30, 2022 and 2021 (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2022 2021 2022 2021 Cost of products sold and services delivered $ 1,066 $ 1,838 $ 2,174 $ 3,327 Sales, general and administrative expenses 8,610 114,089 21,592 185,104 Research and development expenses 11,486 21,622 22,484 38,728 Total stock-based compensation expense $ 21,162 $ 137,549 $ 46,250 $ 227,159 |
Accumulated Other Comprehensi_2
Accumulated Other Comprehensive Income (loss) (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Accumulated Other Comprehensive Income (loss). | |
Summary of changes in accumulated other comprehensive income (loss), net of tax | The following tables reflect the changes in accumulated other comprehensive income (loss), net of tax (in thousands): Unrealized Gains (Losses) on Available-for-Sale Foreign Currency Investments Translation Total Balance, December 31, 2021 $ (207) $ (1,110) $ (1,317) Other comprehensive loss (489) (1,072) (1,561) Balance, March 31, 2022 $ (696) $ (2,182) $ (2,878) Other comprehensive loss (161) (2,166) (2,327) Balance, June 30, 2022 $ (857) $ (4,348) $ (5,205) Unrealized Gains (Losses) on Available-for-Sale Foreign Currency Investments Translation Total Balance, December 31, 2020 $ — $ 141 $ 141 Other comprehensive income — 1 1 Balance, March 31, 2021 $ — $ 142 $ 142 Other comprehensive loss — (369) (369) Balance, June 30, 2021 $ — $ (227) $ (227) |
Segment Data (Tables)
Segment Data (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Segment Data | |
Summary of Operational Information Relative to the Company's Reportable Segments | Information relative to our reportable segments was as follows (in thousands): Three Months Ended June 30, 2022 Three Months Ended June 30, 2021 Software and Software and TASER Sensors Total TASER Sensors Total Net sales from products $ 131,721 $ 68,330 $ 200,051 $ 110,637 $ 45,790 $ 156,427 Net sales from services 3,865 81,697 85,562 1,891 60,477 62,368 Net sales 135,586 150,027 285,613 112,528 106,267 218,795 Cost of product sales 48,463 39,039 87,502 37,701 27,600 65,301 Cost of service sales — 24,148 24,148 145 15,420 15,565 Cost of sales 48,463 63,187 111,650 37,846 43,020 80,866 Gross margin $ 87,123 $ 86,840 $ 173,963 $ 74,682 $ 63,247 $ 137,929 Research and development $ 13,316 $ 44,231 $ 57,547 $ 12,313 $ 41,639 $ 53,952 Six Months Ended June 30, 2022 Six Months Ended June 30, 2021 Software and Software and TASER Sensors Total TASER Sensors Total Net sales from products $ 242,875 $ 133,380 $ 376,255 $ 207,939 89,374 $ 297,313 Net sales from services 7,071 158,713 165,784 3,588 112,913 116,501 Net sales 249,946 292,093 542,039 211,527 202,287 413,814 Cost of product sales 89,088 77,766 166,854 70,646 53,271 123,917 Cost of service sales — 45,483 45,483 145 28,470 28,615 Cost of sales 89,088 123,249 212,337 70,791 81,741 152,532 Gross margin $ 160,858 $ 168,844 $ 329,702 $ 140,736 $ 120,546 $ 261,282 Research and development $ 23,212 $ 82,751 $ 105,963 $ 21,556 $ 79,414 $ 100,970 |
Organization and Summary of S_4
Organization and Summary of Significant Accounting Policies - Narrative (Details) $ in Millions | 3 Months Ended | 6 Months Ended | 12 Months Ended |
Jun. 30, 2022 USD ($) country customer | Jun. 30, 2022 USD ($) customer item segment country | Dec. 31, 2021 USD ($) customer | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Number of reportable segments | segment | 2 | ||
Warranty period | 1 year | ||
Cash surrender value of corporate-owned life insurance policies | $ 4.2 | $ 4.2 | $ 5.3 |
Investments in number of unconsolidated affiliates | item | 6 | ||
Restricted cash balance | 1.9 | $ 1.9 | $ 0.1 |
Prepaid Expenses and Other Current Assets | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Restricted cash balance | 1.8 | 1.8 | |
Other Noncurrent Assets | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Restricted cash balance | $ 0.1 | $ 0.1 | |
Net Sales | Geographic Concentration Risk | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Number of countries outside the U.S. representing more than 10% of total net sales | country | 0 | 0 | |
Net Sales | Customer Concentration Risk | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Number of major customers | customer | 0 | 0 | |
Accounts and notes receivable and contract assets | Customer Concentration Risk | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Number of major customers | customer | 0 | 0 |
Organization and Summary of S_5
Organization and Summary of Significant Accounting Policies - Weighted Average Number of Shares Outstanding and Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||||
Jun. 30, 2022 | Mar. 31, 2022 | Jun. 30, 2021 | Mar. 31, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Numerator for basic and diluted earnings per share: | ||||||
Net income (loss) | $ 50,962 | $ 54,871 | $ (47,117) | $ (47,917) | $ 105,833 | $ (95,034) |
Denominator: | ||||||
Weighted average shares outstanding (in shares) | 71,040 | 65,166 | 70,995 | 64,604 | ||
Dilutive effect of stock-based awards (in shares) | 1,243 | 1,321 | ||||
Diluted weighted average shares outstanding (in shares) | 72,283 | 65,166 | 72,316 | 64,604 | ||
Anti-dilutive stock-based awards excluded (in shares) | 2,991 | 10,537 | 2,912 | 8,950 | ||
Earnings (loss) per share | ||||||
Basic (in dollars per share) | $ 0.72 | $ (0.72) | $ 1.49 | $ (1.47) | ||
Diluted (in dollars per share) | $ 0.71 | $ (0.72) | $ 1.46 | $ (1.47) |
Organization and Summary of S_6
Organization and Summary of Significant Accounting Policies - Summary of Changes in Estimated Warranty Reserve (Details) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | |
Movement in Standard and Extended Product Warranty | ||
Balance, beginning of period | $ 2,822 | $ 769 |
Utilization of reserve | (1,574) | (481) |
Warranty expense | 380 | 613 |
Balance, end of period | $ 1,628 | $ 901 |
Revenues - Revenues By Products
Revenues - Revenues By Products And Service Offerings (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Disaggregation of Revenue [Line Items] | ||||
Revenue from contract with customers | $ 285,613 | $ 218,795 | $ 542,039 | $ 413,814 |
TASER 7 | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue from contract with customers | 53,440 | 28,128 | 103,506 | 62,119 |
TASER X26P | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue from contract with customers | 12,339 | 9,569 | 21,818 | 19,532 |
TASER X2 | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue from contract with customers | 4,534 | 16,145 | 8,153 | 28,923 |
TASER Pulse | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue from contract with customers | 3,383 | 3,906 | ||
TASER Consumer devices | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue from contract with customers | 1,687 | 1,701 | ||
Cartridges | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue from contract with customers | 49,845 | 46,678 | 87,670 | 77,096 |
Axon Body | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue from contract with customers | 27,468 | 19,927 | 57,176 | 39,683 |
Axon Flex | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue from contract with customers | 621 | 1,088 | 1,950 | 1,993 |
Axon Fleet | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue from contract with customers | 15,881 | 5,247 | 29,701 | 9,010 |
Axon Dock | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue from contract with customers | 5,849 | 5,509 | 13,329 | 12,429 |
Axon Evidence and cloud services | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue from contract with customers | 85,631 | 62,069 | 168,587 | 115,759 |
Extended warranties | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue from contract with customers | 19,957 | 14,006 | 35,697 | 27,152 |
Other | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue from contract with customers | 8,361 | 8,728 | 11,069 | 16,212 |
TASER | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue from contract with customers | 135,586 | 112,528 | 249,946 | 211,527 |
TASER | TASER 7 | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue from contract with customers | 53,440 | 28,128 | 103,506 | 62,119 |
TASER | TASER X26P | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue from contract with customers | 12,339 | 9,569 | 21,818 | 19,532 |
TASER | TASER X2 | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue from contract with customers | 4,534 | 16,145 | 8,153 | 28,923 |
TASER | TASER Pulse | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue from contract with customers | 3,383 | 3,906 | ||
TASER | TASER Consumer devices | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue from contract with customers | 1,687 | 1,701 | ||
TASER | Cartridges | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue from contract with customers | 49,845 | 46,678 | 87,670 | 77,096 |
TASER | Axon Evidence and cloud services | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue from contract with customers | 3,720 | 1,702 | 6,737 | 3,098 |
TASER | Extended warranties | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue from contract with customers | 7,459 | 5,857 | 14,138 | 11,503 |
TASER | Other | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue from contract with customers | 2,562 | 2,748 | 4,541 | 5,350 |
Software and Sensors | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue from contract with customers | 150,027 | 106,267 | 292,093 | 202,287 |
Software and Sensors | Axon Body | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue from contract with customers | 27,468 | 19,927 | 57,176 | 39,683 |
Software and Sensors | Axon Flex | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue from contract with customers | 621 | 1,088 | 1,950 | 1,993 |
Software and Sensors | Axon Fleet | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue from contract with customers | 15,881 | 5,247 | 29,701 | 9,010 |
Software and Sensors | Axon Dock | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue from contract with customers | 5,849 | 5,509 | 13,329 | 12,429 |
Software and Sensors | Axon Evidence and cloud services | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue from contract with customers | 81,911 | 60,367 | 161,850 | 112,661 |
Software and Sensors | Extended warranties | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue from contract with customers | 12,498 | 8,149 | 21,559 | 15,649 |
Software and Sensors | Other | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue from contract with customers | $ 5,799 | $ 5,980 | $ 6,528 | $ 10,862 |
Revenues - Revenues By Geograph
Revenues - Revenues By Geographic Area (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Disaggregation of Revenue [Line Items] | ||||
Revenue from contract with customers | $ 285,613,000 | $ 218,795,000 | $ 542,039,000 | $ 413,814,000 |
United States | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue from contract with customers | 228,446,000 | 164,908,000 | 442,660,000 | 325,294,000 |
Other countries | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue from contract with customers | $ 57,167,000 | $ 53,887,000 | 99,379,000 | 88,520,000 |
Revenue from Contract with Customer | Geographic Concentration Risk | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue from contract with customers | $ 100 | $ 100 | ||
Concentration risk (as a percentage) | 100% | 100% | ||
Revenue from Contract with Customer | Geographic Concentration Risk | United States | ||||
Disaggregation of Revenue [Line Items] | ||||
Concentration risk (as a percentage) | 80% | 75% | 82% | 79% |
Revenue from Contract with Customer | Geographic Concentration Risk | Other countries | ||||
Disaggregation of Revenue [Line Items] | ||||
Concentration risk (as a percentage) | 20% | 25% | 18% | 21% |
Revenues - Contract Assets, Con
Revenues - Contract Assets, Contract Liabilities (Details) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2022 | Dec. 31, 2021 | |
Revenues | ||
Contract assets, net | $ 224,994 | |
Contract liabilities (deferred revenue) | 522,662 | $ 451,312 |
Revenue recognized in the period from: | ||
Amounts included in contract liabilities at the beginning of the period | $ 172,675 |
Revenues - Schedule Of Contract
Revenues - Schedule Of Contract Liabilities - Deferred revenue (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 |
Disaggregation of Revenue [Line Items] | ||
Current | $ 253,185 | $ 265,591 |
Long-Term | 269,477 | 185,721 |
Total | 522,662 | 451,312 |
TASER | ||
Disaggregation of Revenue [Line Items] | ||
Current | 45,719 | 36,902 |
Long-Term | 44,793 | 36,975 |
Total | 90,512 | 73,877 |
Software and Sensors | ||
Disaggregation of Revenue [Line Items] | ||
Current | 207,466 | 228,689 |
Long-Term | 224,684 | 148,746 |
Total | 432,150 | 377,435 |
Warranty | ||
Disaggregation of Revenue [Line Items] | ||
Current | 35,774 | 44,432 |
Long-Term | 40,300 | 22,903 |
Total | 76,074 | 67,335 |
Warranty | TASER | ||
Disaggregation of Revenue [Line Items] | ||
Current | 16,038 | 21,257 |
Long-Term | 18,222 | 4,766 |
Total | 34,260 | 26,023 |
Warranty | Software and Sensors | ||
Disaggregation of Revenue [Line Items] | ||
Current | 19,736 | 23,175 |
Long-Term | 22,078 | 18,137 |
Total | 41,814 | 41,312 |
Hardware | ||
Disaggregation of Revenue [Line Items] | ||
Current | 73,728 | 47,806 |
Long-Term | 114,871 | 109,950 |
Total | 188,599 | 157,756 |
Hardware | TASER | ||
Disaggregation of Revenue [Line Items] | ||
Current | 26,579 | 12,944 |
Long-Term | 20,016 | 28,727 |
Total | 46,595 | 41,671 |
Hardware | Software and Sensors | ||
Disaggregation of Revenue [Line Items] | ||
Current | 47,149 | 34,862 |
Long-Term | 94,855 | 81,223 |
Total | 142,004 | 116,085 |
Services | ||
Disaggregation of Revenue [Line Items] | ||
Current | 143,683 | 173,353 |
Long-Term | 114,306 | 52,868 |
Total | 257,989 | 226,221 |
Services | TASER | ||
Disaggregation of Revenue [Line Items] | ||
Current | 3,102 | 2,701 |
Long-Term | 6,555 | 3,482 |
Total | 9,657 | 6,183 |
Services | Software and Sensors | ||
Disaggregation of Revenue [Line Items] | ||
Current | 140,581 | 170,652 |
Long-Term | 107,751 | 49,386 |
Total | $ 248,332 | $ 220,038 |
Revenues - Revenue Performance
Revenues - Revenue Performance Obligations (Details) $ in Millions | Jun. 30, 2022 USD ($) |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, remaining performance obligation | $ 3,330 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2029-07-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, remaining performance obligation, expected timing of satisfaction, period | 10 years |
Minimum | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-07-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, remaining performance obligation to be recognized in the next twelve months (as a percentage) | 15% |
Maximum | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-07-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, remaining performance obligation to be recognized in the next twelve months (as a percentage) | 20% |
Revenue, remaining performance obligation, expected timing of satisfaction, period | 12 months |
Cash, Cash Equivalents and In_3
Cash, Cash Equivalents and Investments (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2022 | Dec. 31, 2021 | Jun. 30, 2021 | |
Restricted Cash and Cash Equivalents Items [Line Items] | ||||
Amortized Cost | $ 447,325 | $ 447,325 | $ 492,350 | |
Gross Unrealized Gains | 17 | 17 | 5 | |
Gross Unrealized Losses | (45,188) | (45,188) | (18,101) | |
Fair Value | 402,154 | 402,154 | 474,254 | |
Cash and Cash Equivalents | 212,815 | 212,815 | 356,332 | |
Marketable Securities | 45,900 | 45,900 | 72,180 | |
Short-Term Investments | 118,514 | 118,514 | 14,510 | |
Long-Term Investments | 24,925 | 24,925 | 31,232 | |
Cash and cash equivalents | 212,815 | 212,815 | 356,332 | $ 266,372 |
Short-term investments | 118,514 | 118,514 | 14,510 | |
Long-term investments | 24,925 | 24,925 | 31,232 | |
Fair value of available for sale investments with unrealized losses | 86,700 | 86,700 | ||
Share Purchase Agreement with Cellebrite DI Ltd. | ||||
Restricted Cash and Cash Equivalents Items [Line Items] | ||||
Marketable securities, unrealized gain (loss) | (11,700) | (26,300) | ||
Common stock | Share Purchase Agreement with Cellebrite DI Ltd. | ||||
Restricted Cash and Cash Equivalents Items [Line Items] | ||||
Marketable Securities | $ 90,000 | |||
Investment owned, shares held | 9,000,000 | |||
Fair Value, Inputs, Level 1 | ||||
Restricted Cash and Cash Equivalents Items [Line Items] | ||||
Amortized Cost | 188,541 | 188,541 | $ 103,544 | |
Gross Unrealized Gains | 5 | 5 | 4 | |
Gross Unrealized Losses | (44,126) | (44,126) | (17,820) | |
Fair Value | 144,420 | 144,420 | 85,728 | |
Cash and Cash Equivalents | 52,034 | 52,034 | 2,844 | |
Marketable Securities | 45,900 | 45,900 | 72,180 | |
Short-Term Investments | 40,810 | 40,810 | 10,704 | |
Long-Term Investments | 5,676 | 5,676 | ||
Fair Value, Inputs, Level 2 | ||||
Restricted Cash and Cash Equivalents Items [Line Items] | ||||
Amortized Cost | 103,202 | 103,202 | 35,318 | |
Gross Unrealized Gains | 12 | 12 | 1 | |
Gross Unrealized Losses | (1,062) | (1,062) | (281) | |
Fair Value | 102,152 | 102,152 | 35,038 | |
Cash and Cash Equivalents | 5,199 | 5,199 | ||
Short-Term Investments | 77,704 | 77,704 | 3,806 | |
Long-Term Investments | 19,249 | 19,249 | 31,232 | |
Cash | ||||
Restricted Cash and Cash Equivalents Items [Line Items] | ||||
Amortized Cost | 155,582 | 155,582 | 353,488 | |
Fair Value | 155,582 | 155,582 | 353,488 | |
Cash and Cash Equivalents | 155,582 | 155,582 | 353,488 | |
Money market funds | Fair Value, Inputs, Level 1 | ||||
Restricted Cash and Cash Equivalents Items [Line Items] | ||||
Amortized Cost | 43,550 | 43,550 | 2,844 | |
Fair Value | 43,550 | 43,550 | 2,844 | |
Cash and Cash Equivalents | 43,550 | 43,550 | 2,844 | |
Agency bonds | Fair Value, Inputs, Level 1 | ||||
Restricted Cash and Cash Equivalents Items [Line Items] | ||||
Amortized Cost | 26,601 | 26,601 | 10,700 | |
Gross Unrealized Gains | 5 | 5 | 4 | |
Gross Unrealized Losses | (2) | (2) | ||
Fair Value | 26,604 | 26,604 | 10,704 | |
Cash and Cash Equivalents | 8,484 | 8,484 | ||
Short-Term Investments | 18,120 | 18,120 | 10,704 | |
Treasury bills | Fair Value, Inputs, Level 1 | ||||
Restricted Cash and Cash Equivalents Items [Line Items] | ||||
Amortized Cost | 28,390 | 28,390 | ||
Gross Unrealized Losses | (24) | (24) | ||
Fair Value | 28,366 | 28,366 | ||
Short-Term Investments | 22,690 | 22,690 | ||
Long-Term Investments | 5,676 | 5,676 | ||
Marketable securities | Fair Value, Inputs, Level 1 | ||||
Restricted Cash and Cash Equivalents Items [Line Items] | ||||
Amortized Cost | 90,000 | 90,000 | 90,000 | |
Gross Unrealized Losses | (44,100) | (44,100) | (17,820) | |
Fair Value | 45,900 | 45,900 | 72,180 | |
Marketable Securities | 45,900 | 45,900 | 72,180 | |
State and municipal obligations | Fair Value, Inputs, Level 2 | ||||
Restricted Cash and Cash Equivalents Items [Line Items] | ||||
Amortized Cost | 5,814 | 5,814 | 2,570 | |
Gross Unrealized Gains | 1 | 1 | ||
Gross Unrealized Losses | (35) | (35) | (5) | |
Fair Value | 5,780 | 5,780 | 2,565 | |
Short-Term Investments | 4,257 | 4,257 | 1,400 | |
Long-Term Investments | 1,523 | 1,523 | 1,165 | |
Corporate bonds | Fair Value, Inputs, Level 2 | ||||
Restricted Cash and Cash Equivalents Items [Line Items] | ||||
Amortized Cost | 57,609 | 57,609 | 32,748 | |
Gross Unrealized Gains | 11 | 11 | 1 | |
Gross Unrealized Losses | (1,027) | (1,027) | (276) | |
Fair Value | 56,593 | 56,593 | 32,473 | |
Cash and Cash Equivalents | 5,199 | 5,199 | ||
Short-Term Investments | 33,668 | 33,668 | 2,406 | |
Long-Term Investments | 17,726 | 17,726 | $ 30,067 | |
Commercial paper | Fair Value, Inputs, Level 2 | ||||
Restricted Cash and Cash Equivalents Items [Line Items] | ||||
Amortized Cost | 39,779 | 39,779 | ||
Fair Value | 39,779 | 39,779 | ||
Short-Term Investments | $ 39,779 | $ 39,779 |
Expected Credit Losses (Details
Expected Credit Losses (Details) $ in Thousands | 6 Months Ended |
Jun. 30, 2022 USD ($) | |
Accounts Receivable, Allowance for Credit Loss [Roll Forward] | |
Balance, beginning of period | $ 3,349 |
Provision for expected credit losses | 183 |
Amounts written off charged against the allowance | (396) |
Other, including foreign currency translation | (3) |
Balance, end of period | 3,133 |
United States | |
Accounts Receivable, Allowance for Credit Loss [Roll Forward] | |
Balance, beginning of period | 3,171 |
Provision for expected credit losses | (50) |
Amounts written off charged against the allowance | (396) |
Balance, end of period | 2,725 |
Other countries | |
Accounts Receivable, Allowance for Credit Loss [Roll Forward] | |
Balance, beginning of period | 178 |
Provision for expected credit losses | 233 |
Other, including foreign currency translation | (3) |
Balance, end of period | $ 408 |
Expected Credit Losses - Type O
Expected Credit Losses - Type Of Customer Receivable (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 |
Expected Credit Losses | ||
Accounts receivable and notes receivable, current | $ 1,927 | $ 2,203 |
Contract assets, net | 1,058 | 1,010 |
Long-term notes receivable, net of current portion | 148 | 136 |
Total allowance for expected credit losses on customer receivables | $ 3,133 | $ 3,349 |
Inventory (Details)
Inventory (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 |
Inventory | ||
Raw materials | $ 50,995 | $ 38,267 |
Finished goods | 103,302 | 70,421 |
Total inventory | $ 154,297 | $ 108,688 |
Property and Equipment - Summar
Property and Equipment - Summary of Property and Equipment (Details) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2022 | Dec. 31, 2021 | |
Property, Plant and Equipment [Line Items] | ||
Total cost | $ 225,880 | $ 197,241 |
Less: Accumulated depreciation | (67,964) | (58,784) |
Property and equipment, net | 157,916 | 138,457 |
Land held for sale | ||
Property, Plant and Equipment [Line Items] | ||
Total cost | 3,173 | |
Land | ||
Property, Plant and Equipment [Line Items] | ||
Total cost | 51,612 | 54,868 |
Building and leasehold improvements | ||
Property, Plant and Equipment [Line Items] | ||
Total cost | $ 26,745 | 25,712 |
Building and leasehold improvements | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Life | 3 years | |
Building and leasehold improvements | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Life | 39 years | |
Production equipment | ||
Property, Plant and Equipment [Line Items] | ||
Total cost | $ 54,879 | 54,090 |
Production equipment | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Life | 3 years | |
Production equipment | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Life | 5 years | |
Computers, equipment and software | ||
Property, Plant and Equipment [Line Items] | ||
Total cost | $ 21,338 | 15,343 |
Computers, equipment and software | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Life | 3 years | |
Computers, equipment and software | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Life | 5 years | |
Furniture and office equipment | ||
Property, Plant and Equipment [Line Items] | ||
Total cost | $ 7,407 | 6,838 |
Furniture and office equipment | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Life | 3 years | |
Furniture and office equipment | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Life | 5 years | |
Vehicles | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Life | 5 years | |
Total cost | $ 3,624 | 2,932 |
Website development costs | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Life | 3 years | |
Total cost | $ 204 | 204 |
Capitalized internal-use software development costs | ||
Property, Plant and Equipment [Line Items] | ||
Total cost | $ 13,994 | 11,996 |
Capitalized internal-use software development costs | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Life | 3 years | |
Capitalized internal-use software development costs | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Life | 5 years | |
Construction-in-process | ||
Property, Plant and Equipment [Line Items] | ||
Total cost | $ 42,904 | 25,258 |
New campus development | ||
Property, Plant and Equipment [Line Items] | ||
Total cost | $ 21,200 | $ 12,400 |
Strategic Investments (Details)
Strategic Investments (Details) - USD ($) $ in Thousands | 6 Months Ended | 28 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | |
Equity Securities without Readily Determinable Fair Value [Line Items] | |||
Balance, beginning of period | $ 83,520 | $ 11,711 | |
Investments | 61,500 | 20,500 | $ 116,656 |
Observable price changes | 70,041 | 40,855 | 112,951 |
Exercises | 66,630 | 66,630 | |
Sales | (14,546) | (14,546) | |
Balance, end of period | 281,691 | 58,520 | 281,691 |
Investment in unconsolidated affiliate | 281,691 | 58,520 | 281,691 |
Unrealized gain on observable price changes | 70,000 | ||
Exercise price of warrants | 6,600 | ||
Unrealized gains on warrants exercised | 60,100 | ||
Realized gain on sale of investment | 12,300 | ||
Dedrone, Inc | |||
Equity Securities without Readily Determinable Fair Value [Line Items] | |||
Balance, end of period | 25,000 | 25,000 | |
Investment in unconsolidated affiliate | 25,000 | 25,000 | |
Fusus, Inc. | |||
Equity Securities without Readily Determinable Fair Value [Line Items] | |||
Balance, end of period | 21,000 | 21,000 | |
Investment in unconsolidated affiliate | 21,000 | 21,000 | |
DroneSense, Inc | |||
Equity Securities without Readily Determinable Fair Value [Line Items] | |||
Balance, end of period | 15,000 | 15,000 | |
Investment in unconsolidated affiliate | 15,000 | 15,000 | |
Strategic investments | |||
Equity Securities without Readily Determinable Fair Value [Line Items] | |||
Balance, beginning of period | 80,775 | 9,500 | |
Investments | 45,160 | 20,500 | 97,728 |
Observable price changes | 41,502 | 40,321 | 84,255 |
Exercises | 96,719 | 96,719 | |
Sales | (14,546) | (14,546) | |
Balance, end of period | 264,156 | 55,775 | 264,156 |
Investment in unconsolidated affiliate | 264,156 | 55,775 | 264,156 |
Warrants | |||
Equity Securities without Readily Determinable Fair Value [Line Items] | |||
Balance, beginning of period | 2,745 | 2,211 | |
Investments | 2,588 | ||
Observable price changes | 28,539 | 534 | 28,696 |
Exercises | (30,089) | (30,089) | |
Balance, end of period | 1,195 | 2,745 | 1,195 |
Investment in unconsolidated affiliate | 1,195 | $ 2,745 | 1,195 |
Call options | |||
Equity Securities without Readily Determinable Fair Value [Line Items] | |||
Investments | 16,340 | 16,340 | |
Balance, end of period | 16,340 | 16,340 | |
Investment in unconsolidated affiliate | $ 16,340 | $ 16,340 |
Accrued Liabilities (Details)
Accrued Liabilities (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 | Jun. 30, 2021 | Dec. 31, 2020 |
Accrued Liabilities | ||||
Accrued salaries, benefits and bonus | $ 53,360 | $ 62,425 | ||
Accrued professional, consulting and lobbying fees | 6,907 | 7,152 | ||
Accrued warranty expense | 1,628 | 2,822 | $ 901 | $ 769 |
Accrued income and other taxes | 6,420 | 3,736 | ||
Accrued inventory in transit | 9,625 | 9,945 | ||
Other accrued expenses | 23,040 | 17,627 | ||
Accrued liabilities | $ 100,980 | $ 103,707 |
Income Taxes (Details)
Income Taxes (Details) $ in Millions | 6 Months Ended |
Jun. 30, 2022 USD ($) | |
Income Taxes | |
Deferred tax assets, net | $ 100.5 |
Liability for unrecognized tax benefits | 19.6 |
Research and development tax credit studies | $ 10.9 |
Effective tax rate (as a percentage) | 24.90% |
Effective tax rate, before discrete period adjustment (as a percentage) | 26% |
Discrete tax benefit, stock-based compensation | $ 1.6 |
Stockholders' Equity - CEO Perf
Stockholders' Equity - CEO Performance Award - Additional Information (Details) $ in Thousands | 6 Months Ended | 49 Months Ended | |
May 24, 2018 USD ($) tranche item shares | Jun. 30, 2022 USD ($) shares | Jun. 30, 2022 USD ($) shares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Market capitalization goal for such tranche | $ 2,500,000 | ||
Market capitalization goal increment | $ 1,000,000 | ||
Recorded share-based compensation expense | $ 236,000 | ||
Number of awards expected to vest | shares | 1,100,000 | 1,100,000 | |
Revenue goal number 1 | $ 710,058 | $ 710,058 | |
Revenue goal number 2 | 860,058 | 860,058 | |
Revenue goal number 3 | 1,010,058 | 1,010,058 | |
Revenue goal number 4 | 1,210,058 | 1,210,058 | |
Revenue goal number 5 | 1,410,058 | 1,410,058 | |
Revenue goal number 6 | 1,610,058 | 1,610,058 | |
Revenue goal number 7 | 1,810,058 | 1,810,058 | |
Revenue goal number 8 | 2,010,058 | 2,010,058 | |
Adjusted EBITDA goal number 1 | 125,000 | 125,000 | |
Adjusted EBITDA goal number 2 | 155,000 | 155,000 | |
Adjusted EBITDA goal number 3 | 175,000 | 175,000 | |
Adjusted EBITDA goal number 4 | 190,000 | 190,000 | |
Adjusted EBITDA goal number 5 | 200,000 | 200,000 | |
Adjusted EBITDA goal number 6 | 210,000 | 210,000 | |
Adjusted EBITDA goal number 7 | 220,000 | 220,000 | |
Adjusted EBITDA goal number 8 | $ 230,000 | 230,000 | |
Performance Shares | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Performance shares authorized (in shares) | shares | 6,365,856 | ||
Number of options vested | shares | 5,300,000 | ||
Weighted average period over which costs are recognized | 1 year 1 month 6 days | ||
CEO Performance Award | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Unrecognized share-based compensation cost related to unvested stock option awards, probable of achievement | $ 9,900 | $ 9,900 | |
Chief Executive Officer | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Number of vesting tranches of share-based awards | tranche | 12 | ||
Vesting period | 10 years | ||
Number of performance goals, revenue | item | 8 | ||
Number of performance goals, adjusted EBITDA | item | 8 |
Stockholders' Equity - eXponent
Stockholders' Equity - eXponential Stock Performance Plan (Details) shares in Millions, $ in Millions | 6 Months Ended | 41 Months Ended | 49 Months Ended | ||
Feb. 12, 2019 USD ($) tranche item | May 24, 2018 USD ($) | Jun. 30, 2022 USD ($) shares | Jun. 30, 2022 USD ($) shares | Jun. 30, 2022 USD ($) shares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Market capitalization goal for such tranche | $ 2,500 | ||||
Market capitalization goal increment | $ 1,000 | ||||
Recorded share-based compensation expense | $ 236 | ||||
Number of awards expected to vest | shares | 1.1 | 1.1 | 1.1 | ||
eXponential Stock Units | 2019 eXponential Stock Performance Plan | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Expiration period | 9 years | ||||
Number of vesting tranches of share-based awards | tranche | 12 | ||||
Market capitalization goal for such tranche | $ 2,500 | ||||
Number of performance goals, revenue | item | 8 | ||||
Number of performance goals, adjusted EBITDA | item | 8 | ||||
Market capitalization goal increment | $ 1,000 | ||||
Anti-dilution provision, maximum shares growth rate per year | 3% | ||||
Recorded share-based compensation expense | $ 180.8 | ||||
Number of awards expected to vest | shares | 1.2 | 1.2 | 1.2 | ||
Unrecognized stock-based compensation expense | $ 14.8 | $ 14.8 | $ 14.8 | ||
Weighted average period over which costs are recognized | 1 year 7 months 6 days |
Stockholders' Equity - Summary
Stockholders' Equity - Summary of RSU and PSU Activity (Details) $ / shares in Units, shares in Thousands, $ in Thousands | 6 Months Ended |
Jun. 30, 2022 USD ($) $ / shares shares | |
Restricted Stock Units (RSUs) | |
Share-based Compensation Arrangement by Share-based Payment Award, Non-Option Equity Instruments, Outstanding [Roll Forward] | |
Number of Units outstanding, beginning of year (in shares) | shares | 1,115 |
Number of Units, Granted (in shares) | shares | 324 |
Number of Units, Released (in shares) | shares | (170) |
Number of Units, Forfeited (in shares) | shares | (103) |
Number of Units outstanding, end of period (in shares) | shares | 1,166 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract] | |
Weighted Average Grant Date Fair Value, Units outstanding, beginning of year (in dollars per share) | $ / shares | $ 133.40 |
Weighted Average Grant Date Fair Value, Granted (in dollars per share) | $ / shares | 121.16 |
Weighted Average Grant Date Fair Value, Released (in dollars per share) | $ / shares | 77.07 |
Weighted Average Grant Date Fair Value, Forfeited (in dollars per share) | $ / shares | 137.01 |
Weighted Average Grant Date Fair Value, Units outstanding, end of period (in dollars per share) | $ / shares | $ 137.85 |
Aggregate intrinsic value at end of period | $ | $ 108,680 |
Performance Stock Units (PSUs) | |
Share-based Compensation Arrangement by Share-based Payment Award, Non-Option Equity Instruments, Outstanding [Roll Forward] | |
Number of Units outstanding, beginning of year (in shares) | shares | 1,499 |
Number of Units, Granted (in shares) | shares | 88 |
Number of Units, Released (in shares) | shares | (33) |
Number of Units, Forfeited (in shares) | shares | (166) |
Number of Units outstanding, end of period (in shares) | shares | 1,388 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract] | |
Weighted Average Grant Date Fair Value, Units outstanding, beginning of year (in dollars per share) | $ / shares | $ 39.86 |
Weighted Average Grant Date Fair Value, Granted (in dollars per share) | $ / shares | 114.78 |
Weighted Average Grant Date Fair Value, Released (in dollars per share) | $ / shares | 118.08 |
Weighted Average Grant Date Fair Value, Forfeited (in dollars per share) | $ / shares | 28.78 |
Weighted Average Grant Date Fair Value, Units outstanding, end of period (in dollars per share) | $ / shares | $ 44.06 |
Aggregate intrinsic value at end of period | $ | $ 129,308 |
Stockholders' Equity - RSU and
Stockholders' Equity - RSU and PSU - Additional Information (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | 49 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Dec. 31, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Recorded share-based compensation expense | $ 236,000 | ||||
Tax payments, for net share settlement of share based award | $ 2,319 | $ 10,312 | |||
Stock Options | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Aggregate intrinsic value price per share (in dollars per share) | $ 93.17 | $ 93.17 | $ 93.17 | ||
Restricted Stock Units (RSUs) | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Aggregate intrinsic value price per share (in dollars per share) | $ 93.17 | $ 93.17 | $ 93.17 | ||
Unrecognized stock-based compensation expense | $ 118,200 | $ 118,200 | $ 118,200 | ||
Weighted average period over which costs are recognized | 2 years 1 month 6 days | ||||
Number of shares vested | 170 | ||||
Number of units outstanding (in shares) | 1,166 | 1,166 | 1,166 | 1,115 | |
Shares withheld, for net share settlement of share based award (in shares) | 7 | ||||
Tax payments, for net share settlement of share based award | $ 900 | ||||
Performance Stock Units (PSUs) | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Aggregate intrinsic value price per share (in dollars per share) | $ 93.17 | $ 93.17 | $ 93.17 | ||
Unrecognized stock-based compensation expense | $ 23,700 | $ 23,700 | $ 23,700 | ||
Weighted average period over which costs are recognized | 1 year 7 months 6 days | ||||
Performance criteria had been met (in shares) | 20 | ||||
Number of shares vested | 33 | ||||
Number of units outstanding (in shares) | 1,388 | 1,388 | 1,388 | 1,499 | |
Shares withheld, for net share settlement of share based award (in shares) | 12 | ||||
Tax payments, for net share settlement of share based award | $ 1,400 |
Stockholders' Equity - Summar_2
Stockholders' Equity - Summary of the Company's Stock Options Activity (Details) - Stock Options $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended |
Jun. 30, 2022 USD ($) $ / shares shares | Jun. 30, 2022 USD ($) $ / shares shares | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward] | ||
Number of options, Options outstanding, beginning of year (in shares) | 2,438 | |
Number of options, Exercised (in shares) | 0 | |
Number of options, Options outstanding, end of year (in shares) | 2,438 | 2,438 |
Number of options, Options exercisable, end of period (in shares) | 1,377 | 1,377 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price [Abstract] | ||
Weighted average exercise price, Options outstanding, beginning of year (in dollars per share) | $ / shares | $ 28.58 | |
Weighted average exercise price, Options outstanding, end of period (in dollars per share) | $ / shares | $ 28.58 | 28.58 |
Weighted average exercise price, Options exercisable, end of period (in dollars per share) | $ / shares | $ 28.58 | $ 28.58 |
Weighted average remaining contractual life, Options outstanding, end of period | 5 years 7 months 28 days | |
Weighted average remaining contractual life, Options exercisable, end of period | 5 years 7 months 28 days | |
Aggregate intrinsic value, Options outstanding, end of period | $ | $ 157,468 | $ 157,468 |
Aggregate intrinsic value, Options exercisable, end of period | $ | $ 88,939 | $ 88,939 |
Stockholders' Equity - Stock Op
Stockholders' Equity - Stock Option Activity - Additional Information (Details) - $ / shares shares in Thousands | 3 Months Ended | |
Jun. 30, 2022 | Dec. 31, 2021 | |
Stock Options | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Aggregate intrinsic value price per share (in dollars per share) | $ 93.17 | |
Stock options exercised (in shares) | 0 | |
Number of options outstanding (in shares) | 2,438 | 2,438 |
Performance Shares | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number of options outstanding (in shares) | 1,100 |
Stockholders' Equity - Reported
Stockholders' Equity - Reported Share-Based Compensation (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Stock-based compensation expense | $ 21,162 | $ 137,549 | $ 46,250 | $ 227,159 |
Cost of products sold and services delivered | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Stock-based compensation expense | 1,066 | 1,838 | 2,174 | 3,327 |
Sales, general and administrative expenses | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Stock-based compensation expense | 8,610 | 114,089 | 21,592 | 185,104 |
Research and development expenses | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Stock-based compensation expense | $ 11,486 | $ 21,622 | $ 22,484 | $ 38,728 |
Stockholders' Equity - Stock Re
Stockholders' Equity - Stock Repurchase Plan - Additional Information (Details) - USD ($) | 3 Months Ended | |||||
Apr. 06, 2022 | Jun. 30, 2022 | Jun. 30, 2021 | May 31, 2022 | Sep. 30, 2019 | Feb. 29, 2016 | |
2022 Stock Incentive Plan | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Common stock reserved for issuance (in shares) | 2,500,000 | |||||
Shares available for grant under the plan (in shares) | 3,400,000 | |||||
2016 Stock Incentive Plan | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Outstanding common stock repurchase program authorized amount (up to) | $ 50,000,000 | |||||
Shares repurchased during period (in shares) | 0 | 0 | ||||
Remaining authorized repurchase amount | $ 16,300,000 | |||||
2019 Inducement Plan | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Common stock reserved for issuance (in shares) | 500,000 | |||||
Shares granted | 29,507 | |||||
2019 Inducement Plan | Maximum | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Shares available for grant under the plan (in shares) | 100 |
Stockholders' Equity - At-the-M
Stockholders' Equity - At-the-Market equity offering - Additional Information (Details) - ATM Offering $ in Millions | 12 Months Ended |
Dec. 31, 2021 USD ($) shares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Issuance of common stock (in shares) | shares | 577,956 |
Gross proceeds | $ 107.6 |
Net proceeds | 105.4 |
Commissions | 1.6 |
Stock issuance costs | $ 0.5 |
Maximum number of common stock shares to be sold | shares | 3,000,000 |
Line of Credit (Details)
Line of Credit (Details) $ in Millions | 6 Months Ended | |
Jun. 30, 2022 USD ($) | Dec. 31, 2021 USD ($) | |
Debt Instrument [Line Items] | ||
Maximum ratio of total liabilities to tangible net worth | 2.50 | |
Line of Credit | ||
Debt Instrument [Line Items] | ||
Accordion feature allowing for increase in borrowing capacity | $ 100 | |
Letters of credit outstanding amount | 6.5 | |
Available borrowing under letter of credit | 43.5 | |
Line of credit borrowings | $ 0 | $ 0 |
EBITDA ratio | 0 | |
Line of Credit | Unsecured Revolving Line of Credit | ||
Debt Instrument [Line Items] | ||
Total availability under line of credit agreement | $ 50 | |
Line of Credit | Letter of Credit | ||
Debt Instrument [Line Items] | ||
Available borrowing under letter of credit | $ 20 | |
Minimum | Line of Credit | London Interbank Offered Rate (LIBOR) | ||
Debt Instrument [Line Items] | ||
Debt instrument basis spread on variable rate (as a percentage) | 1% | |
Maximum | Line of Credit | London Interbank Offered Rate (LIBOR) | ||
Debt Instrument [Line Items] | ||
Debt instrument basis spread on variable rate (as a percentage) | 1.50% |
Commitments and Contingencies (
Commitments and Contingencies (Details) $ in Millions | 1 Months Ended | 6 Months Ended |
Jun. 30, 2022 USD ($) lawsuit | Jun. 30, 2022 USD ($) lawsuit | |
Loss Contingencies [Line Items] | ||
Number of lawsuits against Company | lawsuit | 3 | 3 |
Amount self-insured for any product claim | $ 5 | |
Line of Credit | ||
Loss Contingencies [Line Items] | ||
Letters of credit outstanding amount | $ 6.5 | 6.5 |
Outstanding letters of credit and bank guarantees not drawn against credit facility | $ 0.4 | 0.4 |
Data Storage | ||
Loss Contingencies [Line Items] | ||
Purchase agreement term | 6 years | |
Purchase obligation | $ 425 | 425 |
Surety Bond | ||
Loss Contingencies [Line Items] | ||
Bonds outstanding | 21.1 | 21.1 |
Expire throughout 2023 | Surety Bond | ||
Loss Contingencies [Line Items] | ||
Letters of credit outstanding amount | 6.5 | 6.5 |
Expiring in 2022 | Surety Bond | ||
Loss Contingencies [Line Items] | ||
Bonds outstanding | 3.1 | 3.1 |
Expiring in 2023 | Surety Bond | ||
Loss Contingencies [Line Items] | ||
Bonds outstanding | 7.5 | 7.5 |
Expiring in 2024 | Surety Bond | ||
Loss Contingencies [Line Items] | ||
Bonds outstanding | $ 10.5 | $ 10.5 |
Accumulated Other Comprehensi_3
Accumulated Other Comprehensive Income (loss) (Details) - USD ($) $ in Thousands | 3 Months Ended | |||
Jun. 30, 2022 | Mar. 31, 2022 | Jun. 30, 2021 | Mar. 31, 2021 | |
Accumulated other comprehensive income (loss): | ||||
Beginning balance | $ 1,124,789 | $ 1,047,849 | $ 1,010,904 | $ 976,255 |
Other comprehensive income (loss) | (2,327) | (1,561) | ||
Ending balance | 1,193,651 | 1,124,789 | 1,097,699 | 1,010,904 |
Accumulated Other Comprehensive Income (Loss) | ||||
Accumulated other comprehensive income (loss): | ||||
Beginning balance | (2,878) | (1,317) | 142 | 141 |
Other comprehensive income (loss) | (2,327) | (1,561) | (369) | 1 |
Ending balance | (5,205) | (2,878) | (227) | 142 |
Unrealized Gains (Losses) on Available-for-Sale Investments | ||||
Accumulated other comprehensive income (loss): | ||||
Beginning balance | (696) | (207) | ||
Other comprehensive income (loss) | (161) | (489) | ||
Ending balance | (857) | (696) | ||
Foreign Currency Translation | ||||
Accumulated other comprehensive income (loss): | ||||
Beginning balance | (2,182) | (1,110) | 142 | 141 |
Other comprehensive income (loss) | (2,166) | (1,072) | (369) | 1 |
Ending balance | $ (4,348) | $ (2,182) | $ (227) | $ 142 |
Employee Benefit Plans (Details
Employee Benefit Plans (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Employee Benefit Plans | ||||
Defined contribution plan, cost | $ 2.3 | $ 1.8 | $ 5.4 | $ 3.8 |
Segment Data (Details)
Segment Data (Details) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 USD ($) | Jun. 30, 2021 USD ($) | Jun. 30, 2022 USD ($) segment | Jun. 30, 2021 USD ($) | |
Segment Reporting Information [Line Items] | ||||
Number of reportable segments of company | segment | 2 | |||
Net sales | $ 285,613 | $ 218,795 | $ 542,039 | $ 413,814 |
Cost of sales | 111,650 | 80,866 | 212,337 | 152,532 |
Gross margin | 173,963 | 137,929 | 329,702 | 261,282 |
Research and development | 57,547 | 53,952 | 105,963 | 100,970 |
TASER | ||||
Segment Reporting Information [Line Items] | ||||
Net sales | 135,586 | 112,528 | 249,946 | 211,527 |
Cost of sales | 48,463 | 37,846 | 89,088 | 70,791 |
Gross margin | 87,123 | 74,682 | 160,858 | 140,736 |
Research and development | 13,316 | 12,313 | 23,212 | 21,556 |
Software and Sensors | ||||
Segment Reporting Information [Line Items] | ||||
Net sales | 150,027 | 106,267 | 292,093 | 202,287 |
Cost of sales | 63,187 | 43,020 | 123,249 | 81,741 |
Gross margin | 86,840 | 63,247 | 168,844 | 120,546 |
Research and development | 44,231 | 41,639 | 82,751 | 79,414 |
Product | ||||
Segment Reporting Information [Line Items] | ||||
Net sales | 200,051 | 156,427 | 376,255 | 297,313 |
Cost of sales | 87,502 | 65,301 | 166,854 | 123,917 |
Product | TASER | ||||
Segment Reporting Information [Line Items] | ||||
Net sales | 131,721 | 110,637 | 242,875 | 207,939 |
Cost of sales | 48,463 | 37,701 | 89,088 | 70,646 |
Product | Software and Sensors | ||||
Segment Reporting Information [Line Items] | ||||
Net sales | 68,330 | 45,790 | 133,380 | 89,374 |
Cost of sales | 39,039 | 27,600 | 77,766 | 53,271 |
Service | ||||
Segment Reporting Information [Line Items] | ||||
Net sales | 85,562 | 62,368 | 165,784 | 116,501 |
Cost of sales | 24,148 | 15,565 | 45,483 | 28,615 |
Service | TASER | ||||
Segment Reporting Information [Line Items] | ||||
Net sales | 3,865 | 1,891 | 7,071 | 3,588 |
Cost of sales | 145 | 145 | ||
Service | Software and Sensors | ||||
Segment Reporting Information [Line Items] | ||||
Net sales | 81,697 | 60,477 | 158,713 | 112,913 |
Cost of sales | $ 24,148 | $ 15,420 | $ 45,483 | $ 28,470 |