Garmin Shares Surge 14% as Fiscal Q4 Results Beat Estimates

Garmin Ltd. (GRMN) shares surged 14% in premarket trading on Wednesday, February 20, 2025, following the release of its fiscal fourth-quarter 2024 results. The GPS navigation and wearable technology company reported revenue growth of 23% year-on-year to $1.82 billion, surpassing the analyst consensus estimate of $1.70 billion. Additionally, Garmin's pro forma EPS of $2.41 beat the analyst consensus estimate of $2.03, marking a 40% increase from the corresponding period in the prior year.



Garmin's strong performance was driven by robust growth across all segments, with the fitness segment leading the way. Revenue from fitness grew by 31% year over year to $539.31 million, fueled by the release of the Lily 2 Active smartwatch. The outdoor segment witnessed a 29% increase, primarily due to growth in adventure watches like the Approach R50. The aviation segment achieved a modest 9% revenue growth, driven by novel technological advances like the G3000 PRIME flight deck. The marine segment enjoyed a 5% revenue rise, maintaining its steadiness with products like chartplotters, while the auto OEM sector saw 30% growth, primarily driven by growth in domain controllers.

Garmin's gross margin increased by 100 basis points to 59.3%, and the operating margin climbed to 28.3% from 23.0% a year ago. The company generated $399.2 million in free cash flow for the quarter, compared to $417.3 million a year ago. As of December 28, 2024, Garmin held $3.7 billion in cash and equivalents.

For fiscal 2025, Garmin expects revenue of $6.80 billion versus the consensus of $6.72 billion and a pro forma EPS of $7.80 against the consensus of $7.74. The company plans to maintain its focus on premium and niche markets, championing innovation and advanced technological solutions.

Garmin's strategic diversification across fitness, outdoor, aviation, marine, and automotive segments has contributed to its consistent revenue growth and market leadership. The company's investments in research and development, particularly in aviation technologies, have driven innovation and maintained its competitive edge. With a strong outlook for fiscal 2025, Garmin's shares are poised to continue their upward trajectory.