Garmin Posts Record Revenue of $1.99 Billion and Raises Full-Year Guidance

Garmin raised its full-year 2026 outlook on Wednesday after posting record third-quarter revenue and operating income, as demand for its wearables and adventure watches pushed sales up 12%.

The Switzerland-based maker of fitness, outdoor, aviation and marine devices now expects 2026 revenue of about $8.15 billion and pro forma EPS of $10.80, according to the earnings release it filed with an 8-K on Wednesday.

Record quarter, wider margins

Revenue rose 12% to a record $1.99 billion. Operating income jumped 34% to a record $612 million, and operating margin widened to 30.8% from 25.8%.

GAAP diluted EPS rose 35% to $2.80, while pro forma EPS climbed 39% to $2.76.

Gross margin expanded 420 basis points to 63.3%, with higher margins in every segment. Garmin attributed the improvement mainly to favorable segment mix, lower product costs and about $33 million in refunds of previously paid tariffs.

"We achieved another quarter of record operating results driven by strength across markets and product categories, with meaningful contributions from recently launched products," President and CEO Cliff Pemble said in the release.

Total operating expenses rose 10% to $646 million, driven mainly by personnel-related costs and advertising. The effective tax rate fell to 18.1% from 21.2%, which Garmin said primarily reflects higher expected U.S. deductions under provisions of 2025 U.S. tax legislation that took effect in 2026.

Watches lead the way

The outdoor segment grew fastest, with revenue up 20% to $597 million, driven mainly by adventure watches. During the quarter, Garmin launched its fenix 9 and fenix 9 Pro series. The segment generated $233 million of operating income.

Fitness, the largest segment, grew 16% to $694 million on strong demand for wearables and produced $231 million of operating income. Marine also rose 16% to $310 million, led by sonar products, and aviation grew 5% to $253 million. Garmin said more than 2,500 aircraft are now equipped with its Autoland emergency landing system.

Auto OEM was the weak spot. Revenue fell 20% to $132 million, primarily because of domain controllers, and the segment posted a $12 million operating loss.

Cash and dividends

Garmin generated $394 million of operating cash flow and $293 million of free cash flow in the quarter. It paid a $202 million quarterly dividend and repurchased $41 million of shares, leaving about $407 million in its $500 million buyback program authorized through December 2028.

The company ended the quarter with about $4.1 billion in cash and marketable securities. Its board set Dec. 24 as the payment date for the next dividend installment of $1.05 per share, with a Dec. 11 record date.

The outlook

The new guidance assumes a gross margin of 61.0%, an operating margin of 29.0% and a full-year tax rate of 16.5%.

Pemble said Garmin is raising its outlook based on results so far and "the momentum we are experiencing as we enter the important holiday selling season." The company also filed its quarterly report on Form 10-Q on Wednesday.

Sources

1. Garmin Form 8-K with third-quarter 2026 earnings release (Exhibit 99.1), filed Oct. 28, 2026 (accession 0001193125-26-435066)
2. Garmin Form 10-Q for the quarter ended Sept. 27, 2026, filed Oct. 28, 2026 (accession 0001193125-26-435070)

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