Reports record full-year revenue and profit, and proposes a 20% dividend increase
SCHAFFHAUSEN, Switzerland, Feb. 19, 2025 /PRNewswire/ — Garmin® Ltd. (NYSE: GRMN), today announced results for the fourth quarter ended December 28, 2024.
Highlights for fourth quarter 2024 include:
Consolidated revenue of $1.82 billion, a 23% increase compared to the prior year quarterGross margin expanded to 59.3% from 58.3% in the prior year quarterOperating margin expanded to 28.3% compared to 23.0% in the prior year quarterOperating income was $516 million, a 52% increase compared to the prior year quarterGAAP EPS of $2.25 and pro forma EPS(1) of $2.41, representing 40% growth in pro forma EPS over the prior year quarterShipped over 300 million units since inceptionRunway Occupancy Awareness technology honored with a prestigious Laureate Award from Aviation Week NetworkGarmin ranked No. 1 for the 21st consecutive year in Professional Pilot’s Avionics Manufacturers Product Support SurveyLaunched the Approach® R50, portable golf launch monitor with a built-in simulatorLaunched the Descent™ X50i, our first large-format dive computer
Highlights for fiscal year 2024 include:
Celebrated our 35th year anniversary of creating innovative productsRecord consolidated revenue of $6.30 billion, a 20% increase compared to the prior yearAll segments posted record full-year revenueGross margin expanded to 58.7% compared to 57.5% in the prior yearOperating margin expanded to 25.3% compared to 20.9% in the prior yearRecord operating income of $1.59 billion, a 46% increase compared to the prior yearGAAP EPS of $7.30 and record pro forma EPS(1) of $7.39, representing 32% growth in pro forma EPS over the prior year
(In thousands, except per share information)
13-Weeks Ended
52-Weeks Ended
December 28,
December 30,
YoY
December 28,
December 30,
YoY
2024
2023
Change
2024
2023
Change
Net sales
$
1,822,560
$
1,482,501
23
%
$
6,296,903
$
5,228,252
20
%
Fitness
539,305
412,076
31
%
1,774,487
1,344,637
32
%
Outdoor
629,373
486,378
29
%
1,961,990
1,697,151
16
%
Aviation
236,875
217,134
9
%
876,614
846,329
4
%
Marine
251,259
239,886
5
%
1,073,192
916,911
17
%
Auto OEM
165,748
127,027
30
%
610,620
423,224
44
%
Gross profit
1,079,926
864,149
25
%
3,696,555
3,004,955
23
%
Gross margin %
59.3
%
58.3
%
58.7
%
57.5
%
Operating income
516,082
340,454
52
%
1,593,994
1,092,160
46
%
Operating margin %
28.3
%
23.0
%
25.3
%
20.9
%
GAAP diluted EPS
$
2.25
$
2.82
(20)
%
$
7.30
$
6.71
9
%
Pro forma diluted EPS (1)
$
2.41
$
1.72
40
%
$
7.39
$
5.59
32
%
(1) See attached Non-GAAP Financial Information for discussion and reconciliation of non-GAAP financial measures, including pro forma diluted EPS
Executive Overview from Cliff Pemble, President and Chief Executive Officer:
“2024 was a year of remarkable growth and achievement for Garmin, resulting in record full-year consolidated revenue and record full-year revenue in all five of our segments, as well as record full-year consolidated operating income. We are entering 2025 with continued strong momentum from our robust product lineup and have many product launches planned during the year. I am very proud of what we accomplished in 2024 and look forward to all that 2025 will bring.” – Cliff Pemble, President and Chief Executive Officer of Garmin Ltd.
Fitness:
Revenue from the fitness segment increased 31% in the fourth quarter with growth across all categories led by strong demand for wearables. Gross and operating margins were 57% and 30%, respectively, resulting in $159 million of operating income. During the quarter, we launched Lily® 2 Active, our smallest smartwatch with GPS, featuring a timeless design and up to nine days of battery life in smartwatch mode. We also recently released our 2024 Connect Fitness Report which highlights overall health and fitness trends of our customers around the world.
Outdoor:
Revenue from the outdoor segment increased 29% in the fourth quarter with growth led by adventure watches. Gross and operating margins were 67% and 40%, respectively, resulting in $251 million of operating income. During the quarter, we launched the Approach R50, the only portable golf launch monitor with a built-in simulator, featuring a 10″ built-in color touchscreen display and more than 43,000 preloaded golf courses worldwide. We also launched the Descent X50i, our largest dive computer with a vivid 3″ color display providing rich information that is readable at a glance.
Aviation:
Revenue from the aviation segment grew 9% in the fourth quarter with growth contributions from both the OEM and aftermarket product categories. Gross and operating margins were 75% and 27%, respectively, resulting in $64 million of operating income. During the quarter, Textron Aviation announced the G3000® PRIME integrated flight deck with Autoland for the Cessna Citation CJ4 Gen3. Also, the G3000 PRIME has been selected by BETA Technologies for the ALIA conventional take-off and landing electric aircraft, which conducted its inaugural flight during the quarter.
Marine:
Revenue from the marine segment increased 5% in the fourth quarter with growth across multiple categories. Gross and operating margins were 58% and 20%, respectively, resulting in $51 million of operating income. During the quarter, Garmin was awarded a 2024 National Boating Safety Award from the Sea Tow Foundation for the fourth consecutive year. Also during the quarter, JL Audio® received an Innovation Award for its Pavilion line of outdoor home speakers from Home Technology Specialists of America, Inc., a leading consumer electronics trade group.
Auto OEM:
Revenue from the auto OEM segment increased 30% during the fourth quarter due to increased shipments of domain controllers. Gross margin was 17%, and we recorded an operating loss of $9 million in the quarter. Our Unified Cabin domain controller solution was recognized as a Consumer Electronics Show 2025 Innovation Award Honoree in the in-vehicle entertainment category.
Additional Financial Information:
Total operating expenses in the fourth quarter were $564 million, an 8% increase over the prior year, primarily driven by higher personnel-related costs.
In the fourth quarter of 2024, we reported $80 million of income tax expense, representing an effective tax rate of 15.6%. In the fourth quarter of 2023, we reported a $159 million income tax benefit. Excluding $181 million of income tax benefit due to the revaluation of certain Switzerland deferred tax assets, and $12 million of income tax benefit due to auto OEM manufacturing tax incentives in Poland, our pro forma effective tax rate(1) in the fourth quarter of 2023 was 9.0%. The increase in the current quarter effective tax rate compared to the prior year pro forma tax rate is primarily due to an increase in the combined federal and cantonal Switzerland statutory tax rate in response to global minimum tax requirements.
In the fourth quarter of 2024, we generated operating cash flow of $484 million and free cash flow(1) of $399 million. We paid a quarterly dividend of approximately $144 million and repurchased $33 million of the Company’s shares within the quarter, leaving approximately $238 million remaining as of December 28, 2024 in the share repurchase program authorized through December 2026. We ended the quarter with cash and marketable securities of approximately $3.7 billion.
(1)
See attached Non-GAAP Financial Information for discussion and reconciliation of non-GAAP financial measures, including pro forma effective tax rate and free cash flow.
2025 Fiscal Year Guidance(2):
We expect full-year 2025 revenue of approximately $6.80 billion, an increase of approximately 8% over 2024. We expect our full-year pro forma EPS to be approximately $7.80 based upon gross margin of approximately 58.7%, operating margin of approximately 25.0% and pro forma effective tax rate of approximately 16.5%.
2025 Guidance
Revenue
$6.80B
Gross Margin
58.7 %
Operating Margin
25.0 %
Pro forma Effective Tax Rate
16.5 %
Pro forma EPS
$7.80
(2)
All amounts and %’s in the above 2025 Guidance table are approximate. Also, see attached discussion on Forward-looking Financial Measures.
Dividend Recommendation:
The Board of Directors intends to recommend to the shareholders for approval at the annual meeting to be held on June 6, 2025, a cash dividend in the amount of $3.60 per share, payable in four equal installments on dates to be determined by the Board. The Board currently anticipates the scheduling of the dividend in four installments as follows:
Dividend Date
Record Date
Dividend Per Share
June 27, 2025
June 16, 2025
$0.90
September 26, 2025
September 12, 2025
$0.90
December 26, 2025
December 12, 2025
$0.90
March 27, 2026
March 13, 2026
$0.90
In addition, the Board has established March 28, 2025 as the payment date and March 14, 2025 as the record date for the final dividend installment of $0.75 per share, per the prior dividend approval at the 2024 annual shareholders’ meeting. The first, second and third payments of $0.75 per share were made on June 28, 2024, September 27, 2024, and December 27, 2024, respectively.
Webcast Information/Forward-Looking Statements:
The information for Garmin Ltd.’s earnings call is as follows:
An archive of the live webcast will be available until February 18, 2026 on the Garmin website at www.garmin.com. To access the replay, click on the Investors link and click over to the Events Calendar page.
This release includes projections and other forward-looking statements regarding Garmin Ltd. and its business that are commonly identified by words such as “anticipates,” “would,” “may,” “expects,” “estimates,” “plans,” “intends,” “projects,” and other words or phrases with similar meanings. Any statements regarding the Company’s expected fiscal 2025 GAAP and pro forma estimated earnings, EPS, and effective tax rate, and the Company’s expected segment revenue growth rates, consolidated revenue, gross margins, operating margins, potential future acquisitions, share repurchase programs, currency movements, expenses, pricing, new product launches, market reach, statements relating to possible future dividends, and the Company’s plans and objectives are forward-looking statements. The forward-looking events and circumstances discussed in this release may not occur and actual results could differ materially as a result of risk factors and uncertainties affecting Garmin, including, but not limited to, the risk factors that are described in the Annual Report on Form 10-K for the year ended December 28, 2024 filed by Garmin with the Securities and Exchange Commission (Commission file number 001-41118). A copy of Garmin’s 2024 Form 10-K can be downloaded from https://www.garmin.com/en-US/investors/sec/. All information provided in this release and in the attachments is as of December 28, 2024. Undue reliance should not be placed on the forward-looking statements in this press release, which are based on information available to us on the date hereof. We undertake no duty to update this information unless required by law.
This release and the attachments contain non-GAAP financial measures. A reconciliation to the nearest GAAP measure and a discussion of the Company’s use of these measures are included in the attachments.
Garmin, the Garmin logo, Approach, G3000, Lily and JL Audio are trademarks of Garmin Ltd. or its subsidiaries and are registered in one or more countries, including the U.S. Descent is a trademark of Garmin Ltd. or its subsidiaries. All other brands, product names, company names, trademarks and service marks are the properties of their respective owners. All rights reserved.
Garmin Ltd. and Subsidiaries
Condensed Consolidated Statements of Income (Unaudited)
(In thousands, except per share information)
13-Weeks Ended
52-Weeks Ended
December 28,
December 30,
December 28,
December 30,
2024
2023
2024
2023
Net sales
$
1,822,560
$
1,482,501
$
6,296,903
$
5,228,252
Cost of goods sold
742,634
618,352
2,600,348
2,223,297
Gross profit
1,079,926
864,149
3,696,555
3,004,955
Research and development expense
258,752
237,245
993,601
904,696
Selling, general and administrative expenses
305,092
286,450
1,108,960
1,008,099
Total operating expenses
563,844
523,695
2,102,561
1,912,795
Operating income
516,082
340,454
1,593,994
1,092,160
Other income (expense):
Interest income
30,377
22,840
113,520
77,302
Foreign currency (losses) gains
(36,184)
19,488
(20,599)
26,434
Other income
5,864
254
8,486
4,460
Total other income (expense)
57
42,582
101,407
108,196
Income before income taxes
516,139
383,036
1,695,401
1,200,356
Income tax provision (benefit)
80,405
(159,089)
283,965
(89,280)
Net income
$
435,734
$
542,125
$
1,411,436
$
1,289,636
Net income per share:
Basic
$
2.27
$
2.83
$
7.35
$
6.74
Diluted
$
2.25
$
2.82
$
7.30
$
6.71
Weighted average common shares outstanding:
Basic
192,075
191,363
192,060
191,397
Diluted
193,759
192,557
193,281
192,058
Garmin Ltd. and Subsidiaries
Condensed Consolidated Balance Sheets (Unaudited)
(In thousands)
December 28,
2024
December 30,
2023
Assets
Current assets:
Cash and cash equivalents
$
2,079,468
$
1,693,452
Marketable securities
421,270
274,618
Accounts receivable, net
983,404
815,243
Inventories
1,473,978
1,345,955
Deferred costs
24,040
16,316
Prepaid expenses and other current assets
353,993
318,556
Total current assets
5,336,153
4,464,140
Property and equipment, net
1,236,884
1,224,097
Operating lease right-of-use assets
164,656
143,724
Noncurrent marketable securities
1,198,331
1,125,191
Deferred income tax assets
822,521
754,635
Noncurrent deferred costs
6,898
11,057
Goodwill
603,947
608,474
Other intangible assets, net
154,163
181,145
Other noncurrent assets
106,974
91,106
Total assets
$
9,630,527
$
8,603,569
Liabilities and Stockholders’ Equity
Current liabilities:
Accounts payable
$
359,365
$
253,790
Salaries and benefits payable
210,879
190,014
Accrued warranty costs
62,473
55,738
Accrued sales program costs
108,492
98,610
Other accrued expenses
216,721
245,874
Deferred revenue
110,997
101,189
Income taxes payable
294,582
225,475
Dividend payable
144,349
139,997
Total current liabilities
1,507,858
1,310,687
Deferred income tax liabilities
103,274
114,682
Noncurrent income taxes payable
7,014
16,521
Noncurrent deferred revenue
28,321
36,148
Noncurrent operating lease liabilities
134,886
113,035
Other noncurrent liabilities
776
436
Stockholders’ equity:
Common shares (194,901 and 195,880 shares authorized and issued;
192,468 and 191,777 shares outstanding)
19,490
19,588
Additional paid-in capital
2,247,484
2,125,467
Treasury shares (2,433 and 4,103 shares)
(270,521)
(330,909)
Retained earnings
5,999,183
5,263,528
Accumulated other comprehensive income (loss)
(147,238)
(65,614)
Total stockholders’ equity
7,848,398
7,012,060
Total liabilities and stockholders’ equity
$
9,630,527
$
8,603,569
Garmin Ltd. and Subsidiaries
Consolidated Statements of Cash Flows (Unaudited)
(In thousands)
52-Weeks Ended
December 28, 2024
December 30, 2023
Operating Activities:
Net income
$
1,411,436
$
1,289,636
Adjustments to reconcile net income to net cash provided by
operating activities:
Depreciation
140,494
132,347
Amortization
39,241
45,225
(Gain) loss on sale or disposal of property and equipment
(4,903)
215
Unrealized foreign currency losses (gains)
26,889
(25,541)
Deferred income taxes
(88,137)
(340,774)
Stock compensation expense
137,162
101,422
Realized losses on marketable securities
8
62
Changes in operating assets and liabilities, net of acquisitions:
Accounts receivable, net of allowance for doubtful accounts
(196,256)
(129,120)
Inventories
(178,815)
244,506
Other current and noncurrent assets
(42,130)
7,887
Accounts payable
120,637
28,503
Other current and noncurrent liabilities
24,546
52,188
Deferred revenue
2,223
10,411
Deferred costs
(3,615)
(2,661)
Income taxes
43,691
(38,041)
Net cash provided by operating activities
1,432,471
1,376,265
Investing activities:
Purchases of property and equipment
(193,571)
(193,524)
Purchase of marketable securities
(507,518)
(170,681)
Redemption of marketable securities
309,166
183,372
Acquisitions, net of cash acquired
(16,444)
(150,853)
Other investing activities, net
15,034
(1,286)
Net cash used in investing activities
(393,333)
(332,972)
Financing activities:
Dividends
(572,355)
(558,769)
Proceeds from issuance of treasury shares related to equity awards
49,963
44,063
Purchase of treasury shares related to equity awards
(42,117)
(22,815)
Purchase of treasury shares under share repurchase plan
(62,348)
(98,988)
Net cash used in financing activities
(626,857)
(636,509)
Effect of exchange rate changes on cash and cash equivalents
(26,283)
7,460
Net increase in cash, cash equivalents, and restricted cash
385,998
414,244
Cash, cash equivalents, and restricted cash at beginning of year
1,694,156
1,279,912
Cash, cash equivalents, and restricted cash at end of year
$
2,080,154
$
1,694,156
Garmin Ltd. and Subsidiaries
Net Sales, Gross Profit and Operating Income by Segment (Unaudited)
(In thousands)
Fitness
Outdoor
Aviation
Marine
Auto OEM
Total
13-Weeks Ended December 28, 2024
Net sales
$
539,305
$
629,373
$
236,875
$
251,259
$
165,748
$
1,822,560
Gross profit
308,632
420,759
178,379
144,655
27,501
1,079,926
Operating income (loss)
159,161
251,322
64,469
50,588
(9,458)
516,082
13-Weeks Ended December 30, 2023
Net sales
$
412,076
$
486,378
$
217,134
$
239,886
$
127,027
$
1,482,501
Gross profit
232,147
317,061
162,214
126,099
26,628
864,149
Operating income (loss)
92,550
163,855
56,671
37,294
(9,916)
340,454
52-Weeks December 28, 2024
Net sales
$
1,774,487
$
1,961,990
$
876,614
$
1,073,192
$
610,620
$
6,296,903
Gross profit
1,032,007
1,306,405
656,509
594,127
107,507
3,696,555
Operating income (loss)
482,672
702,730
211,367
236,010
(38,785)
1,593,994
52-Weeks December 30, 2023
Net sales
$
1,344,637
$
1,697,151
$
846,329
$
916,911
$
423,224
$
5,228,252
Gross profit
716,906
1,072,861
625,988
491,261
97,939
3,004,955
Operating income (loss)
232,201
515,254
226,400
179,429
(61,124)
1,092,160
Garmin Ltd. and Subsidiaries
Net Sales by Geography (Unaudited)
(In thousands)
13-Weeks Ended
52-Weeks Ended
December 28,
December 30,
YoY
December 28,
December 30,
YoY
2024
2023
Change
2024
2023
Change
Net sales
$
1,822,560
$
1,482,501
23 %
$
6,296,903
$
5,228,252
20 %
Americas
854,816
732,648
17 %
3,036,083
2,614,358
16 %
EMEA
701,252
523,439
34 %
2,319,310
1,775,965
31 %
APAC
266,492
226,414
18 %
941,510
837,929
12 %
EMEA – Europe, Middle East and Africa
APAC – Asia Pacific and Australian Continent
Non-GAAP Financial Information
To supplement our financial results presented in accordance with GAAP, this release includes the following measures defined by the Securities and Exchange Commission as non-GAAP financial measures: pro forma effective tax rate, pro forma net income (earnings) per share and free cash flow. These non-GAAP measures are not based on any comprehensive set of accounting rules or principles and should not be considered a substitute for, or superior to, financial measures calculated in accordance with GAAP, and may be different from non-GAAP measures used by other companies, limiting the usefulness of the measures for comparison with other companies. Management believes providing investors with an operating view consistent with how it manages the Company provides enhanced transparency into the operating results of the Company, as described in more detail by category below.
The tables below provide reconciliations between the GAAP and non-GAAP measures.
Pro forma effective tax rate
The Company’s income tax expense is periodically impacted by discrete tax items that are not reflective of income tax expense incurred as a result of current period earnings. Therefore, management believes disclosure of the effective tax rate and income tax provision before the effect of certain discrete tax items are important measures to permit investors’ consistent comparison between periods. In the full year 2024 there were no such discrete tax items identified.
(In thousands)
13-Weeks Ended
52-Weeks Ended
December 28,
December 30,
December 28,
December 30,
2024
2023
2024
2023
$
ETR(1)
$
ETR(1)
$
ETR(1)
$
ETR(1)
GAAP income tax provision (benefit)
$
80,405
15.6 %
$
(159,089)
(41.5) %
$
283,965
16.7 %
$
(89,280)
(7.4) %
Pro forma discrete tax items:
Tax effect of state rate change (2)
—
—
—
(2,269)
Switzerland deferred tax assets (3)
—
181,410
—
181,410
Poland incentive tax credits (4)
—
12,116
—
12,116
Pro forma income tax provision
$
80,405
15.6 %
$
34,437
9.0 %
$
283,965
16.7 %
$
101,977
8.5 %
(1) Effective tax rate is calculated by taking the income tax provision (benefit) divided by income before taxes, as presented on the face of the Condensed Consolidated Statements of Income.
(2) In third quarter 2023, the Company recognized $2.3 million of tax expense due to the revaluation of deferred tax assets associated with the change in corporate income tax rate for the state of Kansas.
(3) Certain Switzerland deferred tax assets related to the enactment of Switzerland Federal and Schaffhausen cantonal tax reform were revalued in the fourth quarter of 2023, resulting in income tax benefit of $181.4 million.
(4) In fourth quarter 2023, the Company recognized $12.1 million of income tax benefit due to Auto OEM manufacturing tax incentives in Poland.
Pro forma net income (earnings) per share
Management believes that net income (earnings) per share before the impact of foreign currency gains or losses and certain discrete income tax items, as discussed above, is an important measure in order to permit a consistent comparison of the Company’s performance between periods.
(In thousands, except per share information)
13-Weeks Ended
52-Weeks Ended
December 28,
December 30,
December 28,
December 30,
2024
2023
2024
2023
GAAP net income
$
435,734
$
542,125
$
1,411,436
$
1,289,636
Foreign currency gains / losses (1)
36,184
(19,488)
20,599
(26,434)
Tax effect of foreign currency gains / losses (2)
(5,637)
1,752
(3,450)
2,246
Pro forma discrete tax items (3)
—
(193,526)
—
(191,257)
Pro forma net income
$
466,281
$
330,863
$
1,428,585
$
1,074,191
GAAP net income per share:
Basic
$
2.27
$
2.83
$
7.35
$
6.74
Diluted
$
2.25
$
2.82
$
7.30
$
6.71
Pro forma net income per share:
Basic
$
2.43
$
1.73
$
7.44
$
5.61
Diluted
$
2.41
$
1.72
$
7.39
$
5.59
Weighted average common shares outstanding:
Basic
192,075
191,363
192,060
191,397
Diluted
193,759
192,557
193,281
192,058
(1) Foreign currency gains and losses for the Company are driven by movements of a number of currencies in relation to the U.S. Dollar and the related exchange rate impact on the significant cash, receivables, and payables held in a currency other than the functional currency at a given legal entity. However, there is minimal cash impact from such foreign currency gains and losses.
(2) The tax effect of foreign currency gains and losses was calculated using the pro forma effective tax rate of 15.6% and 16.7% for the 13-weeks and fiscal year ended December 28, 2024, respectively, and the pro forma effective tax rate of 9.0% and 8.5% for the 13-weeks and fiscal year ended December 30, 2023, respectively.
(3) The 2023 discrete tax items are discussed in the pro forma effective tax rate section above.
Free cash flow
Management believes that free cash flow is an important liquidity measure because it represents the amount of cash provided by operations that is available for investing and defines it as operating cash flows less capital expenditures for property and equipment. Management believes that excluding purchases of property and equipment provides a better understanding of the underlying trends in the Company’s operations and allows more accurate comparisons of the Company’s results between periods. This metric may also be useful to investors but should not be considered in isolation as it is not a measure of cash flow available for discretionary expenditures. The most comparable GAAP measure is net cash provided by operating activities.
(In thousands)
13-Weeks Ended
52-Weeks Ended
December 28,
December 30,
December 28,
December 30,
2024
2023
2024
2023
Net cash provided by operating activities
$
483,890
$
465,941
$
1,432,471
$
1,376,265
Less: purchases of property and equipment
(84,702)
(48,648)
(193,571)
(193,524)
Free Cash Flow
$
399,188
$
417,293
$
1,238,900
$
1,182,741
Forward-looking Financial Measures
The forward-looking financial measures in our 2025 guidance provided above do not consider the potential future net effect of foreign currency exchange gains and losses, certain discrete tax items and any other impacts that may be identified as pro forma adjustments in calculating the non-GAAP measures described above.
The estimated impact of foreign currency gains and losses cannot be reasonably estimated on a forward-looking basis due to the high variability and low visibility with respect to non-operating foreign currency exchange gains and losses and the related tax effects of such gains and losses. The impact on diluted net income per share of foreign currency gains and losses, net of tax effects, was $0.09 per share for the 52 weeks ended December 28, 2024.
At this time, management is unable to determine whether or not significant discrete tax items will occur in fiscal 2025 or anticipate the impact of any other events that may be considered in the calculation of non-GAAP financial measures.
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SOURCE Garmin Ltd.
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