Garmin Q3 Earnings: Strong Revenue Growth Wearable Demand, Margin Expansion, Holiday Season Prompts Outlook Boost

Garmin Ltd reported 24% revenue growth in Q3 2024, beating analyst estimates. EPS of $1.99 also beat expectations. Stock rose after earnings report.

Garmin Ltd GRMN reported fiscal third-quarter 2024 revenue growth of 24% year-on-year to $1.59 billion, beating the analyst consensus estimate of $1.44 billion. 

The GPS navigation and wearable technology company's proforma EPS of $1.99 beat the analyst consensus estimate of $1.44. The stock gained after the print.

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Segments: Revenue from Fitness grew by 31% year over year to $463.89 million, led by growth in wearables.

Outdoor revenue increased by 21% year over year to $526.55 million, primarily due to growth in adventure watches. Aviation revenue rose 3% year over year at $204.63 million, driven by aftermarket product categories.

Marine revenue increased by 22% year over year to $222.24 million due to contributions from the acquisition of JL Audio. Auto OEM grew 53% Y/Y to $168.71 million, primarily driven by growth in domain controllers.

The gross margin increased 300 bps to 60.0%, and the operating margin climbed to 27.6% from 21.2% a year ago.

Garmin generated $219.41 million in free cash flow for the quarter versus $311.88 million a year ago. It held $2.42 billion in cash and equivalents as of September 28, 2024.

“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,” said Cliff Pemble, President and Chief Executive Officer of Garmin Ltd.

FY24 Outlook: Garmin expects revenue of $6.12 billion (prior $5.95 billion) versus the consensus of $5.99 billion. It expects a proforma EPS of $6.85 (prior $6.00) against the consensus of $6.08. 

Garmin stock gained over 31% year-to-date.

Price Action: GRMN stock is up 14.01% at $189.50 premarket at the last check on Wednesday.

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