Garmin’s Steady Growth Continues – Q4.2023

With the full-year figures now in for Garmin, we see that the turnaround in Q3 has continued into Q4. Overall the company passed $5bn annual sales for the first time and the cash position surged past $1.5bn for the first time up to almost $1.7bn.

As you can see from the figures at the top of this article, Garmin’s outdoor division (Fenix) has continued its modest growth the full-year position is still below 2022. Contrast that to Fitness (Forerunner, Edge, TACX) and we see modest growth for the whole year but a step change in growth for Q3/Q4 to over 20%.

Turning to regional sales, I’m not sure what to make of the superficially positive picture. YoY numbers are up but how much of that is linked to inflation? Analysts might be disappointed that Garmin is not having the same stellar performance in APAC as elsewhere.

Garmin also kindly shows us the profitability of its business segments. Outdoor (Fenix) is likely still the big cash generator but Fitness is catching up and making big gains over previous periods.

Previous Quarters:

Garmin Outdoor Sales Still Declining – Q2.2023 results are in

Garmin Outdoor Sales – Significant Crash

Detailed notes

Here is what Garmin says about its divisional performances. It’s worth noting that these are forward-looking to a degree. We don’t know to what extent trade sales have been booked into this quarter for the newly announced products that are talked about:

Fitness:
Revenue from the fitness segment increased 22% in the fourth quarter with growth across all categories led by strong demand for wearables. Gross and operating margins were 56% and 22%, respectively, resulting in $93 million of operating income. At the recent Consumer Electronics Show, our Venu 3 was recognized with three CES Innovation Awards, including the prestigious Best of Innovation honor for outstanding design and engineering.

Outdoor:
Revenue from the outdoor segment increased 8% in the fourth quarter with growth across multiple categories led by adventure watches. Gross and operating margins were 65% and 34%, respectively, resulting in $164 million of operating income. During the quarter, we expanded our lineup of dive offerings with the introduction of the Descent G1 Solar – Ocean Edition, our first-ever product made with recycled ocean-bound plastics. We also
launched the new Descent Mk3 watch-style dive computer and the Descent T2 transceiver with enhanced SubWave TM sonar technology. This enhanced underwater technology features diver-to-diver messaging and tank pressure monitoring. Also during the quarter, we launched the eTrex® Solar, our first handheld GPS with solar charging capability allowing for infinite battery life for outdoor adventurers.

Take Out

Garmin continues to buck the recessionary elements in global markets. Nice job all around. I’m impressed.