Bad press did not faze the earnings of Scottsdale stun gun maker Taser International.
The company said Tuesday it recorded record sales and earnings in the third quarter despite months of media reports questioning the safety of the technology.
While executives were pleased with the numbers, they spent most of the time during an earnings conference call defending the safety of their guns to Wall Street analysts and investors.
For the three months ended Sept. 30, the company reported earnings of $6.1 million, or 19 cents per share, up from $1.1 million, or 4 cents per share, in the same quarter a year ago. Revenue reached $18.9 million, more than triple the $6.1 million posted last year.
Analysts surveyed by Thomson First Call predicted earnings of 15 cents per share on revenue of $17.9 million. Taser reported a record 32.3 percent after-tax profit during the quarter, and said it shipped more than 20,000 guns for the first time in its history.
“The third quarter is historically our slowest quarter of the year and we are pleased to be able to report such solid results. With the continued strong new business picture for the company through three consecutive quarters, we now believe we can increase guidance on revenue growth from 150 percent to an increase of 175 percent over the prior year," stated Rick Smith, CEO.
Taser stock increased on the news nearly 6 percent, or $2.18 a share, to close Tuesday on the Nasdaq at $40.25 a share. The company said its financials show it withstood adverse media reports from the New York Times, CBS and other media outlets.
In July, Taser’s stock took a tumble after several media reports were critical of the stun gun’s safety. The Times reported at least 50 people, including six in June, had died since 2001 after being shocked.
It also reported at least two medical examiners said Tasers were partly responsible for the deaths of two people in police custody. The company trumpeted a report this week from the Department of Defense that said the weapons are generally safe. It also listed as positive an announcement during the quarter that about 6,000 armed officers in the United Kingdom will carry Tasers.
“This is the medical equivalent of getting FDA approval on a blockbuster drug,” said Tom Smith, Taser president, adding the British government spent almost four years and several million dollars studying the technology using scientists, doctors and field trials. Over the summer, Massachusetts legalized Tasers for use by law enforcement. Only one state, New Jersey, still does not allow police to use the guns, Tom Smith said.
“The conclusion from all the testing to date is the Taser is generally safe and not the primary cause of any in-custody deaths,” said Phil Smith, Taser chairman. “I'm sure that sticks in the craw of the media because they've had a lot of fun with this, saying this thing has caused death. They continue to put it out there. Continued testing is recommended by these people and we are moving forward on that.”