What Makes Axon Enterprise (AXON) a Strong Investment?

Sands Capital, an investment management company, released its “Sands Capital Global Growth Fund” third-quarter 2025 investor letter. A copy of the letter can be downloaded here. Global Growth adopts a flexible approach to identify the most promising growth companies worldwide. Global equities surged in the quarter, although leadership remains concentrated. In this environment, the strategy returned -2.0% compared to 7.6% for the MSCI ACWI. You can check the fund’s top 5 holdings to know more about its best picks for 2025.

In its third-quarter 2025 investor letter, Sands Capital Global Growth Fund highlighted stocks such as Axon Enterprise, Inc. (NASDAQ:AXON). Axon Enterprise, Inc. (NASDAQ:AXON) manufactures conducted energy devices (CEDs) under the TASER brand. The one-month return for Axon Enterprise, Inc. (NASDAQ:AXON) was 4.51%, and its shares lost 9.00% over the last 52 weeks. On December 16, 2025, Axon Enterprise, Inc. (NASDAQ:AXON) stock closed at $555.06 per share, with a market capitalization of $43.8 billion.

Sands Capital Global Growth Fund stated the following regarding Axon Enterprise, Inc. (NASDAQ:AXON) in its third quarter 2025 investor letter:

“Axon Enterprise, Inc. (NASDAQ:AXON) is a leading provider of public-safety technology, including body cameras, software, and the TASER electroshock device. Shares declined during the period, but the move appeared more technical than fundamental. After a strong run earlier in the year, investors likely took profits, prompting a modest rotation out of the name. Business performance remained strong. In August, Axon reported second quarter results with revenue of $669 million, up 33 percent year over year and ahead of expectations. Software and Services drove growth, with annual recurring revenue rising 18 percent to $1.18 billion. Gross margin expanded to 63.3 percent, and adjusted EBITDA margin improved to 25.7 percent. Net revenue retention held at 124 percent, and future contracted revenue grew to $10.7 billion. Axon continues to strengthen its AI leadership. The recent acquisition of Prepared, an AI-powered platform for 911 call centers, enhances real-time operations and broadens Axon’s role across public safety workflows. Management reaffirmed guidance, underscoring durable momentum.”

Jim Cramer Notes Axon (AXON) is a “New High Natural”

Axon Enterprise, Inc. (NASDAQ:AXON) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 61 hedge fund portfolios held Axon Enterprise, Inc. (NASDAQ:AXON) at the end of the third quarter, which was 62 in the previous quarter. In the third quarter, Axon Enterprise, Inc. (NASDAQ:AXON) generated $711 million in revenue, representing a 31% increase year-over-year.  While we acknowledge the risk and potential of Axon Enterprise, Inc. (NASDAQ:AXON) as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than Axon Enterprise, Inc. (NASDAQ:AXON) and that has 10,000% upside potential, check out our report about this cheapest AI stock.

In another article, we covered Axon Enterprise, Inc. (NASDAQ:AXON) and shared the list of best industrial stocks to buy according to Wall Street analysts. In addition, please check out our hedge fund investor letters Q3 2025 page for more investor letters from hedge funds and other leading investors.

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Disclosure: None. This article is originally published at Insider Monkey.