Garmin Reports Q2 Growth

SCHAFFHAUSEN, Switzerland—Garmin Ltd. (Nasdaq: GRMN – News) today announced results for the second quarter ended June 30, 2018.

Highlights for the second quarter 2018 include:

  • Total revenue of $894 million, growing 8% over the prior year, with fitness, marine, aviation and outdoor collectively growing 17% over the prior year quarter and contributing 80% of total revenue
  • Gross margin of 58.5% compared to 58.2% in the prior year quarter
  • Operating margin of 24.3% compared to 25.2% in the prior year quarter
  • Operating income was $218 million, growing 4% over the prior year quarter
  • GAAP EPS was $1.00 and pro forma EPS(1) was $0.99
  • Launched the vívoactive® 3 music expanding our music offerings into the advanced wellness category
  • Introduced the new revolutionary Panoptix LiveScopeTM delivering the first and only live scanning sonar for recreational fishing
  • Launched the fēnix® 5 Plus series of watches with built-in color maps, Garmin PayTM mobile payments, music storage and added Pulse Ox sensor technology for blood oxygen saturation awareness to the fēnix 5X Plus

“We achieved strong second quarter consolidated revenue growth led by robust double-digit growth in our fitness, marine and aviation segments,” said Cliff Pemble, president and chief executive officer of Garmin Ltd. “We introduced revolutionary products and are pleased with our performance in the first half of 2018. The results we achieved thus far in 2018 give us confidence to raise our full year guidance, and we look forward to the remainder of the year.”

Garmin’s marine segment posted robust revenue growth of 24% driven by organic growth across multiple product categories and our Navionics® acquisition. Gross margin increased year-over-year to 59%. Operating margin declined to 21%, however operating income grew by 14%. During the second quarter of 2018, Garmin introduced the award winning Panoptix LiveScope, a live scanning sonar that allows anglers a real-time clear image in front of, below, and around their boat. Additionally, Garmin was selected as the exclusive marine electronics supplier to Sportsman Boats beginning in model year 2019. We remain focused on innovations and achieving market share gains within the inland fishing category.

During the second quarter of 2018, the outdoor segment grew 4% with growth contributions from all product categories. Gross and operating margins remained strong at 64% and 36%, respectively. Garmin launched the fēnix 5 Plus series, adding color maps, Garmin Pay mobile payments and music to all three watch sizes. Garmin also expanded our sensor technology with the addition of Pulse Ox to the fēnix 5X Plus for blood oxygen saturation awareness for athletes and outdoor enthusiasts. Garmin launched the inReach® mini, a compact satellite communicator that allows for two-way communication from anywhere. Additionally, we have seen positive customer response to our premium golf offerings. Looking forward, Garmin remains focused on opportunities in wearables and other product categories within the outdoor segment.

Read the full earnings statement here.