Garmin Ltd. Announces Record Third Quarter 2024 Results

Garmin Ltd., a global leader in GPS technology and wearable devices, has reported its financial results for the third quarter of 2024, showcasing significant growth and operational achievements. The company has raised its full-year guidance based on the strong performance observed so far.

Financial Highlights

For the third quarter ended September 28, 2024, Garmin reported consolidated revenue of $1.59 billion, marking a 24% increase compared to the same period last year. The gross margin expanded to 60.0%, while the operating margin improved to 27.6%. Operating income surged by 62% to $437 million. The GAAP earnings per share (EPS) stood at $2.07, with a pro forma EPS of $1.99, reflecting a 41% growth in pro forma EPS over the prior year quarter.

Business and Operational Highlights

Garmin's performance was bolstered by strong demand across various segments:

• Fitness: Revenue increased by 31%, driven by robust demand for wearables. The segment achieved gross and operating margins of 61% and 32%, respectively.
• Outdoor: Revenue grew by 21%, primarily due to the success of adventure watches. The segment reported gross and operating margins of 68% and 40%, respectively.
• Aviation: Revenue saw a modest increase of 3%, with growth driven by aftermarket product categories. The segment's gross and operating margins were 75% and 22%, respectively.
• Marine: Revenue rose by 22%, largely due to the acquisition of JL Audio®. The segment reported gross and operating margins of 55% and 17%, respectively.
• Auto OEM: Revenue surged by 53%, driven by growth in domain controllers. The segment's gross margin was 20%, with an operating loss narrowing to $1 million.

Strategic Initiatives and Corporate Developments

Garmin announced several strategic initiatives and corporate developments during the quarter:

• Launched the fēnix® 8 series and the EnduroTM 3, expanding its lineup of outdoor adventure watches.
• Named 2024 Manufacturer of the Year by the National Marine Electronics Association for the 10th consecutive year.
• Acquired Lumishore, a leader in marine LED lighting.
• Co-founders Dr. Min Kao and the late Gary Burrell were enshrined in the National Aviation Hall of Fame.

Management's Perspective

Cliff Pemble, President and Chief Executive Officer of Garmin Ltd., commented, "We delivered another quarter of impressive financial results as our highly differentiated and innovative products resonate with customers, and we successfully leveraged growth opportunities across market segments and geographies. We are raising our 2024 outlook based on the results we have achieved so far and the momentum we are experiencing as we enter the important holiday selling season."

Future Outlook

Based on the performance in the first three quarters of 2024, Garmin has adjusted its full-year guidance. The company now anticipates revenue of approximately $6.12 billion and pro forma EPS of $6.85, based on a gross margin of 58.5%, operating margin of 24.0%, and a full-year effective tax rate of 16.5%.

SEC Filing: GARMIN LTD [ GRMN ] - 8-K - Oct. 30, 2024