Multiple Growth Drivers Lifted Axon (AXON) in Q2

Fidelity Investments, an investment management company, recently released its “Fidelity Growth Strategies Fund” second-quarter 2025 investor letter. A copy of the letter can be downloaded here. The Fidelity Growth Strategies Fund is a diversified domestic equity strategy with a focus on mid-cap growth investments. The fund focuses on investing in high-quality companies that demonstrate consistent growth and generate positive free cash flow. The fund’s Retail Class shares returned 22.74% in the second quarter, underperforming the 18.20% return of the benchmark Russell Midcap Growth Index. U.S. mid-cap growth stocks saw strong gains in Q2, bouncing back from a brief decline in early April following President Trump's tariff announcement. In addition, you can check the fund’s top 5 holdings to know its best picks in 2025.

In its second-quarter 2025 investor letter, Fidelity Growth Strategies Fund highlighted stocks such as Axon Enterprise, Inc. (NASDAQ:AXON). Axon Enterprise, Inc. (NASDAQ:AXON) manufactures conducted energy devices (CEDs) under the TASER brand. The one-month return of Axon Enterprise, Inc. (NASDAQ:AXON) was -4.70%, and its shares gained 80.14% of their value over the last 52 weeks. On September 25, 2025, Axon Enterprise, Inc. (NASDAQ:AXON) stock closed at $712.15 per share, with a market capitalization of $55.907 billion.

Fidelity Growth Strategies Fund stated the following regarding Axon Enterprise, Inc. (NASDAQ:AXON) in its second quarter 2025 investor letter:

"Among individual stocks, a sizable overweight in capital goods firm Axon Enterprise, Inc. (NASDAQ:AXON) (+57%) was the top contributor. The company develops products and technology for the law enforcement industry. It is a high-quality firm with deep competitive moats, including what is essentially a monopoly in the taser business. More recently, Axon has expanded into AI-driven products that enhance police productivity, such as automated report writing and language translators, and these new products have seen strong adoption to date. Axon was our top holding and largest overweight on June 30."

Axon Enterprise, Inc. (NASDAQ:AXON) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 62 hedge fund portfolios held Axon Enterprise, Inc. (NASDAQ:AXON) at the end of the second quarter, which was 61 in the previous quarter. In the second quarter, Axon Enterprise, Inc. (NASDAQ:AXON) generated $669 million in revenue, representing a 33% increase year-over-year and marking its 14th consecutive quarter of revenue growth exceeding 25%. While we acknowledge the potential of Axon Enterprise, Inc. (NASDAQ:AXON) as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

In another article, we covered Axon Enterprise, Inc. (NASDAQ:AXON) and shared the list of stocks buzzing after important analyst calls. ClearBridge Growth Strategy highlighted Axon Enterprise, Inc. (NASDAQ:AXON) as a solid investment with promising growth and margin expansion prospects in its Q2 2025 investor letter. In addition, please check out our hedge fund investor letters Q2 2025 page for more investor letters from hedge funds and other leading investors.

READ NEXT: The Best and Worst Dow Stocks for the Next 12 Months and 10 Unstoppable Stocks That Could Double Your Money.

Disclosure: None. This article is originally published at Insider Monkey.