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Segment Data
9 Months Ended
Sep. 30, 2020
Segment Reporting [Abstract]  
Segment Data

15. Segment Data

Our operations are comprised of two reportable segments: the manufacture and sale of CEDs, batteries, accessories, extended warranties and other products and services (the “TASER” segment); and the software and sensors business, 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." Our Chief Executive Officer, who is the CODM, is not provided asset information or sales, general, and administrative expense by segment.

Information relative to our reportable segments was as follows (in thousands):

Three Months Ended September 30, 2020

Three Months Ended September 30, 2019

Software and 

Software and 

    

TASER

    

Sensors

    

Total

    

TASER

    

Sensors

    

Total

Net sales from products

$

83,517

$

36,574

$

120,091

$

71,424

$

25,073

$

96,497

Net sales from services

 

889

 

45,462

 

46,351

 

319

 

34,021

 

34,340

Net sales

 

84,406

 

82,036

 

166,442

 

71,743

 

59,094

 

130,837

Cost of product sales

 

31,297

 

26,501

 

57,798

 

26,504

 

15,941

 

42,445

Cost of service sales

 

 

10,404

 

10,404

 

 

8,223

 

8,223

Cost of sales

 

31,297

 

36,905

 

68,202

 

26,504

 

24,164

 

50,668

Gross margin

$

53,109

$

45,131

$

98,240

$

45,239

$

34,930

$

80,169

Research and development

$

3,355

$

25,891

$

29,246

$

3,485

$

21,644

$

25,129

Nine Months Ended September 30, 2020

Nine Months Ended September 30, 2019

Software and

Software and

    

TASER

    

Sensors

    

Total

    

TASER

    

Sensors

    

Total

Net sales from products

$

228,569

97,565

$

326,134

$

197,148

$

67,829

$

264,977

Net sales from services

 

2,222

 

126,507

 

128,729

 

558

 

93,474

 

94,032

Net sales

 

230,791

 

224,072

 

454,863

 

197,706

 

161,303

 

359,009

Cost of product sales

 

88,787

 

61,720

 

150,507

 

74,044

 

46,221

 

120,265

Cost of service sales

 

 

29,331

 

29,331

 

 

24,098

 

24,098

Cost of sales

 

88,787

 

91,051

 

179,838

 

74,044

 

70,319

 

144,363

Gross margin

$

142,004

$

133,021

$

275,025

$

123,662

$

90,984

$

214,646

Research and development

$

10,149

$

75,038

$

85,187

$

10,284

$

61,692

$

71,976