Axon Enterprise‘s (NASDAQ:AAXN) offerings have become the gold standard in law-enforcement body cameras, and in related video and cloud services. As of the end of 2018’s third quarter, the company had 325,200 active seats using its Axon Cloud — nearly twice as many as it had in service a year earlier.
Now, another new market for cameras with a cloud connection and live feeds could be opening up: The company has landed its first deal with a paramedic department. With 248,000 EMTs and paramedics in just the U.S., there’s significant growth to be had for Axon if this contract goes well.
Paramedics go live
Cypress Creek Emergency Medical Services will be the first organization to equip paramedics and paramedic supervisors with body cameras. Their goal is to improve communication between first responders, and to use the video captured as an instructional tool. Cypress Creek EMS Executive Director Bradley England said this in Axon’s press release announcing the partnership:
We conducted a trial with Axon cameras in 2014 and it proved to be an invaluable teaching tool that improved our clinical practice and sped up advanced certifications. The use of this technology contributed to saving at least two lives because our paramedics were able to show ER doctors exactly what they saw in the field.
The real-time data from body cameras may be what is most useful in the paramedic market. Axon’s Body 3 camera now supports live-streaming through AT&T and Verizon’s wireless networks, and has embedded GPS. Location information can be key for tracking patients, and if doctors and nurses know what injuries are coming into the emergency room before they arrive, it could improve medical outcomes.
Expanding the addressable market
The good news for Axon Enterprise investors is that paramedics could offer the company an incremental growth market that doesn’t require changing its product line much at all. As of October 2018, management said its total addressable market was worth $8.4 billion. There’s not currently an estimate on the incremental value of the paramedic market for body cameras, but any adjacent market that Axon can add will improve the company’s economics.
Another win for Axon Enterprise
Management has seemed focused on expanding its law enforcement business, but this deal may indicate that it’s looking toward new markets where the data body cameras could be valuable. Those could include paramedics, firefighters, security workers, or even the military.
From an investment perspective, this shows that Axon could have a higher revenue ceiling than it would if it continued to focus solely on law enforcement. Taking body cameras wireless could help expand those opportunities, and I think we’ll see more product announcements like this as more customers see the value of live monitoring.
Travis Hoium owns shares of AT&T, Axon Enterprise, and Verizon Communications. The Motley Fool owns shares of and recommends Axon Enterprise. The Motley Fool recommends Verizon Communications. The Motley Fool has a disclosure policy.