Summary
Garmin Ltd. reported strong financial performance in its fiscal year ending December 28, 2019, with net sales increasing by 12% year-over-year to $3.76 billion. This growth was driven by robust performance across its Fitness, Outdoor, Aviation, and Marine segments, with Fitness becoming the largest revenue contributor at 28% of total sales. The company also saw a significant 21% increase in total operating income, reaching $945.6 million, reflecting improved operational leverage and higher gross margins. The company continues to invest in research and development, with R&D expenses representing 16% of net sales, underscoring its commitment to innovation in its diverse product lines. Garmin's diversified business model across multiple market segments provides resilience, although the auto segment experienced a 14% decline in revenue, primarily due to the ongoing contraction in the Personal Navigation Device (PND) market. Despite this, strategic investments in the Automotive OEM sector are ongoing. Garmin maintains a healthy financial position, with approximately $2.6 billion in cash, cash equivalents, and marketable securities as of year-end 2019. The company also returned value to shareholders through dividends, with declared dividends per share increasing consistently. Management expresses confidence in the company's ability to fund future operations, capital expenditures, and strategic initiatives through operating cash flow and existing cash balances.
Financial Highlights
51 data points| Revenue | $3.76B |
| Cost of Revenue | $1.52B |
| Gross Profit | $2.23B |
| R&D Expenses | $605.37M |
| SG&A Expenses | $518.57M |
| Operating Expenses | $1.29B |
| Operating Income | $945.59M |
| Net Income | $952.49M |
| EPS (Basic) | $5.01 |
| EPS (Diluted) | $4.99 |
| Shares Outstanding (Basic) | 189.93M |
| Shares Outstanding (Diluted) | 190.90M |
Key Highlights
- 1Net sales grew 12% to $3.76 billion in fiscal year 2019, driven by strong performance in Fitness, Outdoor, Aviation, and Marine segments.
- 2Fitness segment became the largest contributor to revenue, accounting for 28% of total sales.
- 3Total operating income increased by 21% to $945.6 million, with operating income as a percentage of net sales improving to 25%.
- 4Research and Development (R&D) expenses were $605.4 million, representing 16% of net sales, indicating a strong focus on innovation.
- 5The Auto segment experienced a 14% decline in net sales, attributed to the shrinking PND market, though OEM investments are ongoing.
- 6The company ended fiscal year 2019 with substantial liquidity, holding $2.6 billion in cash, cash equivalents, and marketable securities.
- 7Garmin declared dividends per share increased to $2.28 in 2019, demonstrating a commitment to returning value to shareholders.