Shares of Axon Enterprise Inc. (NASDAQ:AXON) plummeted 20.83% in after-hours trading on Tuesday following the release of the company's third-quarter earnings report and forward guidance. The sharp decline came despite the company reporting revenue growth, as earnings fell short of analyst expectations and the outlook failed to impress investors.

Axon, known for its Taser stun guns and body cameras used by law enforcement, reported Q3 revenue of $711 million, representing a 31% year-over-year increase and beating the consensus estimate of $704.83 million. However, the company's adjusted earnings per share of $1.17 missed analysts' expectations of $1.54, disappointing investors.

Adding to the negative sentiment, Axon provided Q4 revenue guidance in the range of $750 million to $755 million, which was only slightly above the FactSet consensus estimate of $746.2 million. This outlook suggests a potential slowdown in growth compared to the strong Q3 performance, likely contributing to the stock's sharp after-hours decline.

The earnings miss and conservative guidance overshadowed other positive developments, including Axon's announcement of its acquisition of Carbyne, a move aimed at enhancing its cloud infrastructure and AI capabilities in the emergency response sector. Despite this strategic expansion, investors appeared more focused on the near-term financial performance and outlook.