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