Garmin (GRMN) investor relations material

Executive summary

• Achieved record Q2 2026 revenue of $2.02 billion, up 11% year-over-year, with operating income up 30% to $616 million, driven by strong product demand and favorable mix, especially in Fitness and Marine segments.

• Pro forma EPS rose 29% to $2.81; GAAP EPS was $2.80; gross and operating margins expanded, aided by a $21 million tariff refund.

• Raised full-year 2026 guidance for revenue to $8.05 billion and pro forma EPS to $10.00, reflecting strong first-half results.

• Strategic focus on services and recent acquisitions (TrainingPeaks, TrainHeroic) to enhance the Fitness segment and expand offerings for athletes and coaches.

• All business segments contributed to growth, with especially strong performance in Fitness and Marine; Outdoor saw a slight decline.

Financial highlights

• Gross margin reached 62.4% (up 360 bps YoY), primarily from product mix and tariff refunds; operating margin expanded to 30.4% (up 440 bps YoY).

• Free cash flow for Q2 was $276 million; cash and marketable securities at $4.4 billion.

• Paid $202 million in dividends and repurchased $43 million in stock during Q2; $448 million remains in repurchase authorization.

• GAAP EPS was $2.80 (up 35% YoY); pro forma EPS was $2.81 (up 29% YoY).

• Operating expenses increased 9% YoY to $647 million; R&D expenses were $400 million; SG&A expenses were $343 million.

Outlook and guidance

• Full-year 2026 revenue guidance raised to $8.05 billion; EPS guidance increased to $10.00; gross margin guidance at 59.7%, operating margin at 27%, and effective tax rate at 16.5%.

• Stronger revenue performance expected in the second half due to timing of product launches.

• Management expects continued resilience due to a diversified business model despite global supply constraints and currency fluctuations.