Financial Data and Key Metrics Changes - Consolidated revenue increased 12% to nearly $1.8 billion, setting a new third-quarter record, despite a strong comparison from last year when revenue increased over 24% [4] - Gross margin was 59.1%, a 90 basis point decrease from the prior quarter, primarily due to higher product costs [15] - Operating income reached $457 million, up 4% year-over-year, with a pro forma EPS of $1.99 and GAAP EPS of $2.08 [4][15] Business Segment Data and Key Metrics Changes - **Fitness Segment**: Revenue increased 30% to $601 million, driven by strong demand for advanced wearables, with gross and operating margins at 60% and 32% respectively [6][7] - **Outdoor Segment**: Revenue decreased 5% to $498 million, impacted by the anniversary of the Diesel Series launch and the Phoenix 8 launch, with gross and operating margins at 66% and 34% respectively [8][10] - **Aviation Segment**: Revenue increased 18% to $240 million, with gross and operating margins at 75% and 25% respectively [11] - **Marine Segment**: Revenue increased 20% to $267 million, with gross and operating margins expanding to 56% and 19% respectively [12][13] - **Auto OEM Segment**: Revenue decreased 2% to $165 million, with a gross margin of 15% negatively impacted by increased warranty costs, resulting in an operating loss of $17 million [14] Market Data and Key Metrics Changes - By geography, double-digit growth was achieved in all three regions: 14% in APAC, 13% in EMEA, and 10% in the Americas [16] Company Strategy and Development Direction - The company is focused on maintaining a diversified business model and anticipates delivering another record year of double-digit growth in revenue, operating income, and EPS [4][6] - The launch of new products, such as the Blaze Equine Wellness System and the Phoenix 8 Pro, reflects the company's strategy to innovate and capture market share in various segments [9][12] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving full-year revenue of $7.1 billion and raised full-year EPS guidance to $8.15, reflecting strong year-to-date performance [5][18] - The company is managing through tariff impacts and is focused on optimizing its supply chain structure [70] Other Important Information - The effective tax rate increased to 21.2% due to new U.S. tax legislation affecting R&D cost capitalization [17] - Free cash flow for the third quarter was $425 million, with full-year expectations of approximately $1.3 billion [17] Q&A Session Summary Question: Downward revision to outdoor guidance - Management noted that the Phoenix 8 Pro launched late in Q3, impacting expectations, and acknowledged that previous expectations may have been too high [20][21] Question: Drivers behind gross margin guide for Q4 - Management indicated that higher product costs, tariffs, and warranty accruals impacted gross margins, with Q4 being a more promotional period [22][23][24] Question: Cycle for fitness and outdoor segments - Management views the market as an ongoing opportunity for growth rather than a cyclical pattern, emphasizing strong product lines [28][29] Question: Channel inventory health - Management stated that channel inventory is healthy and lean, ready for Q4, with strong sell-out trends [36] Question: Growth in auto segment - Management anticipates revenue pressure in 2026 due to end-of-life programs but expects new programs to come online in the latter half of 2026 [41] Question: Drivers of growth in aviation segment - Both OEM and aftermarket segments are performing strongly, benefiting from a long backlog and resilient consumer behavior [42] Question: Accrued warranty costs in auto segment - Management clarified that accrued warranty costs were an isolated issue and that long-term margin targets remain unchanged [60][61] Question: Component supply environment - Management acknowledged impacts from the semiconductor market but believes it will benefit customers in the long term [62] Question: Marine segment guidance - Management noted that the end market is stabilizing, with positive consumer interest and market share gains [68]

Financial Data and Key Metrics Changes - Consolidated revenue increased 12% to nearly $1.8 billion, setting a new third-quarter record, with operating income of $457 million, up 4% year-over-year [4][14] - Pro forma EPS increased to $1.99, with full-year EPS guidance raised to $8.15, reflecting an increase of $0.15 over prior guidance [5][17] - Gross margin was 59.1%, a 90 basis point decrease from the prior quarter, while operating margin was 25.8%, a 180 basis point decrease compared to the prior quarter [14][16] Business Segment Performance - **Fitness Segment**: Revenue increased 30% to $601 million, with gross and operating margins of 60% and 32% respectively, resulting in operating income of $194 million [5][6] - **Outdoor Segment**: Revenue decreased 5% to $498 million, with gross and operating margins of 66% and 34% respectively, resulting in operating income of $170 million [8][10] - **Aviation Segment**: Revenue increased 18% to $240 million, with gross and operating margins of 75% and 25% respectively, resulting in operating income of $61 million [11] - **Marine Segment**: Revenue increased 20% to $267 million, with gross and operating margins of 56% and 19% respectively, resulting in operating income of $49 million [12][13] - **Auto OEM Segment**: Revenue decreased 2% to $165 million, with a gross margin of 15, resulting in an operating loss of $17 million [14] Market Data and Key Metrics Changes - Double-digit growth was achieved in all three regions: APAC (14%), EMEA (13%), and Americas (10%) [15] - Inventory increased year-over-year to approximately $1.9 billion, reflecting a strategy to increase inventory of high-demand product lines [16] Company Strategy and Industry Competition - The company is focused on maintaining a diversified business model and leveraging product innovation to capture market share in the wearables market [28] - The launch of new products, such as the Blaze Equine Wellness System, indicates a strategy to enter underserved markets [45] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving another record year of double-digit growth in revenue, operating income, and EPS, driven by strong demand entering the holiday season [5][4] - The company acknowledged challenges in the outdoor segment due to product release cycles but remains optimistic about long-term growth [10][21] Other Important Information - The effective tax rate increased to 21.2% due to new U.S. tax legislation affecting R&D cost capitalization [17] - Free cash flow for the third quarter was $425 million, with expectations of approximately $1.3 billion for the full year [16] Q&A Session Summary Question: What are the main drivers behind the downward revision to outdoor guidance? - Management noted that the Phoenix 8 Pro launched late in Q3, impacting its performance, and acknowledged that expectations may have been too high initially [19][21] Question: Can you elaborate on the implied gross margin guide for Q4? - Management indicated that higher product costs, tariffs, and warranty accruals impacted gross margins, with Q4 being a more promotional period [22][24] Question: How does the company view the cycle for fitness and outdoor segments? - Management sees ongoing opportunities for growth rather than cyclical ups and downs, emphasizing strong market share potential [27][28] Question: What is the health of channel inventory? - Management reported that channel inventory is healthy, with strong sell-out trends in preparation for Q4 [35] Question: What are the expectations for auto OEM growth going into next year? - Management anticipates revenue pressure in 2026 as legacy programs wind down, but expects new programs to come online in the latter half of 2026 [38] Question: What is driving growth in the fitness business? - Growth is attributed to strong consumer behavior and new user registrations across various fitness products [41][42] Question: What is the outlook for the marine segment? - Management noted a stabilized end market with positive consumer interest and market share gains in various categories [56]

Financial Performance - Garmin achieved record third quarter consolidated revenue and operating income[6] - Consolidated revenue reached $1.77 billion, a 12% year-over-year increase[5] - Operating income was $457 million, a 4% year-over-year increase[5] - GAAP EPS was $2.08, a $0.01 increase year-over-year[17] Segment Performance - Fitness segment revenue grew by 30% year-over-year to $601 million, with an operating income of $194 million and a 32% operating margin[7] - Aviation segment revenue increased by 18% year-over-year to $240 million, with an operating income of $61 million and a 25% operating margin[11] - Marine segment revenue grew by 20% year-over-year to $267 million, with an operating income of $49 million and a 19% operating margin[14] - Outdoor segment revenue declined by 5% year-over-year to $498 million, with an operating income of $170 million and a 34% operating margin[9, 10] - Auto OEM segment revenue declined by 2% year-over-year to $165 million, with an operating loss of $17 million and a (10%) operating margin[15] Financial Position - Cash and marketable securities totaled $3.92 billion[22] - Accounts receivable was $956 million[22] - Inventory was $1.89 billion[22] - Free cash flow was $425 million[22] Guidance - The company is raising 2025 EPS guidance[6] - Revenue guidance for 2025 is $7.1 billion[23]

Core Insights - Garmin has raised its adjusted profit forecast for the year, indicating a positive outlook despite challenges in certain segments [1] Financial Performance - The company reported a rise in operating expenses, which may impact overall profitability [1] - There was a decline in quarterly revenue specifically from its outdoor and auto units, suggesting potential weaknesses in these segments [1]

Core Insights - Garmin reported quarterly earnings of $1.99 per share, slightly exceeding the Zacks Consensus Estimate of $1.98 per share, maintaining the same earnings as the previous year, indicating stability in performance [1] - The company generated revenues of $1.77 billion for the quarter ended September 2025, which fell short of the Zacks Consensus Estimate by 1.05%, but showed an increase from $1.59 billion year-over-year [2] - Garmin's stock has increased by approximately 20.3% since the beginning of the year, outperforming the S&P 500's gain of 17.2% [3] Earnings Performance - Over the last four quarters, Garmin has surpassed consensus EPS estimates three times, indicating a generally positive earnings trend [2] - The company had a favorable estimate revisions trend ahead of the earnings release, resulting in a Zacks Rank 2 (Buy) for the stock, suggesting expected outperformance in the near future [6] Future Outlook - The current consensus EPS estimate for the upcoming quarter is $2.29 on revenues of $2.02 billion, while for the current fiscal year, the estimate is $8.09 on revenues of $7.15 billion [7] - The outlook for the Electronics - Miscellaneous Products industry, where Garmin operates, is strong, currently ranking in the top 20% of over 250 Zacks industries, which historically correlates with better stock performance [8]

Core Insights - Garmin matched earnings estimates for Q3 with adjusted earnings of $1.99 per share, but sales were slightly below expectations at $1.77 billion compared to the anticipated $1.78 billion [2][4] - The company's earnings in the same quarter last year were also $1.99 per share, but sales were lower at $1.59 billion, indicating stable earnings year-over-year but growth in sales [2][4] - Following the earnings report, Garmin's stock fell over 3% in premarket trading, dropping to $240 [2][4] Financial Performance - Adjusted earnings per share for Q3 were $1.99, matching analyst expectations [2] - Sales for the September quarter were reported at $1.77 billion, slightly below the forecast of $1.78 billion [2] - Year-over-year comparison shows that sales increased from $1.59 billion in the previous year to $1.77 billion this year [2] Market Position - Garmin is recognized on the IBD Tech Leaders list, indicating its strong position within the technology sector [3] - The company has seen an upgrade in its IBD SmartSelect Composite Rating, rising to 96 from 94, reflecting improved market performance [4][5] - Garmin's stock has shown rising relative strength, although it remains shy of key benchmarks [5]

Financial Performance - Record consolidated revenue of approximately $1.77 billion, a 12% increase compared to the prior year quarter[4] - Operating income reached $456.8 million, a 4% increase year-over-year, with an operating margin of 25.8%[5] - Fitness segment revenue increased by 30% to $601 million, driven by strong demand for advanced wearables[7] - Aviation segment revenue grew by 18% to $240 million, with significant growth in both OEM and aftermarket product categories[9] - Marine segment revenue increased by 20% to $267 million, with new product launches contributing to growth[10] - Auto OEM segment revenue decreased by 2% to $164 million, impacted by legacy programs nearing end-of-life[11] - Net sales for the 13 weeks ended September 27, 2025, reached $1,770,901, a 12% increase from $1,586,022 in the same period last year[31] - Gross profit for the 39 weeks ended September 27, 2025, was $2,998,043, compared to $2,616,630 for the same period in 2024, reflecting a significant increase[29] - Operating income for the 39 weeks ended September 27, 2025, was $1,261,922, up from $1,077,913 in the prior year, indicating strong operational performance[29] - Net income for the 39 weeks ended September 27, 2025, was $1,135,206, a 16% increase from $975,703 in the same period last year[27] - The company reported a diluted net income per share of $5.87 for the 39 weeks ended September 27, 2025, compared to $5.06 in the previous year[27] - GAAP net income for the 13 weeks ended September 27, 2025, was $401,615,000, compared to $399,111,000 for the same period in 2024, reflecting a slight increase[36] - Pro forma net income for the 39 weeks ended September 27, 2025, was $1,117,441,000, up from $962,809,000 in 2024, indicating a year-over-year growth of approximately 16.1%[36] Cash Flow and Expenses - Total operating expenses rose by 15% to $590 million, primarily due to increased personnel-related costs[12] - The company generated operating cash flows of $486 million and free cash flow of $425 million in the third quarter[14] - Free cash flow for the 39 weeks ended September 27, 2025, was $933,301,000, compared to $839,712,000 for the same period in 2024, representing an increase of about 11.1%[39] - Management believes free cash flow is a crucial liquidity measure, defined as operating cash flows less capital expenditures for property and equipment[38] Guidance and Dividends - Full year 2025 revenue guidance updated to approximately $7.10 billion, with pro forma EPS expected to be $8.15[15] - The Board of Directors approved a cash dividend of $0.90 per share, with the next payment date set for December 26, 2025[16] Regional Performance - The Americas region generated net sales of $795,624 for the 13 weeks ended September 27, 2025, a 10% increase year-over-year[31] - The EMEA region saw a 13% increase in net sales to $692,557 for the 13 weeks ended September 27, 2025, compared to the same period last year[31] Assets and Financial Position - Total assets increased to $10,522,878 as of September 27, 2025, from $9,630,527 at the end of 2024, indicating growth in the company's financial position[25] - Cash and cash equivalents at the end of the period were $2,073,546, slightly down from $2,080,154 at the beginning of the period[27] Research and Development - Research and development expenses increased to $831,247 for the 39 weeks ended September 27, 2025, compared to $734,848 in 2024, highlighting a focus on innovation[27] Tax and Currency Impact - The company's effective tax rates for the 13 weeks ended September 27, 2025, were 21.2% and 17.9% for the 39 weeks, reflecting the tax effect of foreign currency gains[37] - There were no discrete tax items identified in the first three quarters of 2025 and 2024, which is important for consistent comparison[34] - The estimated impact of foreign currency gains and losses on diluted net income per share was $0.10 for the 39-week period ended September 27, 2025[42] - The company is unable to estimate the future net effect of foreign currency exchange gains and losses on a forward-looking basis due to high variability[42] - Management's forward-looking financial measures for 2025 include economic assumptions such as foreign currency exchange rates and tariffs, which can change rapidly[40]

Core Insights - Garmin (GRMN) is set to report its third-quarter 2025 results on October 29, with earnings estimated at $1.98 per share, reflecting a year-over-year decrease of 0.5% [1][10] - The Zacks Consensus Estimate for Garmin's revenues in the third quarter of 2025 is $1.79 billion, indicating a year-over-year growth of 12.8% [2][10] - Garmin has exceeded the Zacks Consensus Estimate in three of the last four quarters, with an average surprise of 17.21% [1] Revenue Segments - The Fitness segment is expected to generate revenues of $585 million, representing a year-over-year growth of 26.1%, driven by strong demand for advanced wearables and new wellness products [5][4] - The Outdoor segment's revenues are estimated at $559.9 million, showing a growth of 6.3% year-over-year, supported by strong momentum in wearables and new product launches [7][6] - The Marine segment is projected to achieve revenues of $229.6 million, up 3.3% from the previous year, bolstered by new product launches and the acquisition of Lumishore [9][8] - The Aviation segment's revenues are expected to reach $213.5 million, indicating a year-over-year growth of 4.3%, driven by increased demand in private air travel and new product features [11][10] - The Auto OEM segment is estimated to generate revenues of $178.7 million, reflecting a 5.9% year-over-year growth, attributed to increased shipments to BMW [12] Growth Drivers - Garmin's expanding product portfolio and collaborations, such as the integration with Google Maps, are anticipated to drive top-line growth across various segments [3][4] - Recent product launches, including the Venu 4 smartwatch and various advanced wearables, are expected to enhance revenue performance in the Fitness and Outdoor segments [6][4]

Core Viewpoint - Garmin (GRMN) is expected to report quarterly earnings of $1.98 per share, reflecting a slight decline of 0.5% year-over-year, while revenues are forecasted to increase by 12.8% to $1.79 billion [1] Earnings Estimates - There have been no revisions in the consensus EPS estimate for the quarter over the last 30 days, indicating stability in analysts' forecasts [1][2] Key Metrics Projections - Analysts project 'Net Sales- Marine' to be $239.52 million, a year-over-year increase of 7.8% [4] - 'Net Sales- Aviation' is estimated at $219.19 million, reflecting a 7.1% increase from the previous year [4] - 'Net Sales- Fitness' is expected to reach $593.93 million, showing a significant growth of 28% year-over-year [4] - 'Net Sales- Outdoor' is forecasted at $565.76 million, indicating a 7.5% increase [5] - 'Net Sales- Auto OEM' is estimated at $171.22 million, a modest increase of 1.5% [5] Operating Income Projections - 'Operating income (loss)- Outdoor' is projected to be $202.47 million, down from $208.87 million in the previous year [5] - 'Operating income (loss)- Fitness' is expected to reach $165.69 million, up from $147.77 million year-over-year [6] - 'Operating income (loss)- Marine' is forecasted at $46.17 million, an increase from $37.84 million in the prior year [6] Gross Profit Estimates - 'Gross profit- Fitness' is projected to be $352.82 million, compared to $283.33 million in the same quarter last year [7] - 'Gross profit- Marine' is estimated at $132.91 million, up from $122.43 million year-over-year [7] - 'Gross profit- Aviation' is expected to reach $164.32 million, an increase from $154.14 million in the previous year [7] - 'Gross profit- Outdoor' is projected at $366.21 million, compared to $358.69 million last year [8] Stock Performance - Garmin shares have increased by 5.7% over the past month, outperforming the S&P 500 composite, which rose by 1.3% [8]

Core Insights - Garmin's stock closed at $250.17, reflecting a daily increase of +1.06%, outperforming the S&P 500's gain of 0.58% [1] - The stock has risen by 4.7% over the past month, contrasting with a 0.5% decline in the Computer and Technology sector [1] Earnings Expectations - Garmin's upcoming earnings report is scheduled for October 29, 2025, with expected earnings of $1.98 per share, indicating a year-over-year decline of 0.5% [2] - Revenue is projected at $1.79 billion, representing a 12.84% increase from the same quarter last year [2] Fiscal Year Projections - For the entire fiscal year, earnings are estimated at $8.09 per share and revenue at $7.15 billion, reflecting increases of +9.47% and +13.62% respectively from the prior year [3] Analyst Estimates - Recent changes in analyst estimates for Garmin indicate positive sentiment regarding the company's business operations and profit generation capabilities [4] - The Zacks Rank system, which evaluates these estimate changes, currently ranks Garmin at 2 (Buy) [6] Valuation Metrics - Garmin's Forward P/E ratio stands at 30.61, which is higher than the industry average of 23.19 [7] - The company has a PEG ratio of 2.74, compared to the industry average PEG ratio of 2.03 [7] Industry Context - The Electronics - Miscellaneous Products industry, part of the Computer and Technology sector, holds a Zacks Industry Rank of 40, placing it in the top 17% of over 250 industries [8]