In the final quarter of 2012, Garmin Ltd reported total revenue of US$769 million, down 16% year on year from US$910 million in Q4 2011. However, the position was mixed across Garmin’s operating division… with Garmin’s Fitness business segment its only area of growth in the period:
- Automotive/Mobile segment revenue decreased 25% to US$437 million
- Outdoor segment revenue decreased 2% to US$119 million
- Fitness segment revenue increased 10% to US$104 million
- Aviation segment revenue decreased 2% to US$70 million
- Marine segment revenue decreased 9% to US$39 million
Geographically, revenues decreased in all regions compared to the fourth quarter of 2011.
For the full year of 2012, Garmin reported total revenue of US$2.72 billion, down 2% from US$2.76 billion in 2011. In 2012, Garmin’s Outdoor and Fitness divisions were the only segments to deliver revenue growth. Outdoor segment revenue increased 11% to US$402 million; and Fitness segment revenue increased 8% to US$322 million.
For the full year, Garmin achieved full year gross and operating margin expansion allowing for EPS (Earnings Per Share) growth. The group sold almost 15.4 million units in 2012 with unit growth in outdoor, fitness and automotive OEM largely offsetting declines in personal navigation devices.
In an executive overview of the 2012 full year results, Garmin’s President and Chief Executive Officer Cliff Pemble commented on the performance of the fitness category. “The fitness segment posted revenue growth of 10% in the quarter and full year growth of 8%, contributing US$112 million of full year operating income.”
He added, “Growth in the segment fell slightly short of our full year expectations due to product delays but strong fourth quarter results point to ongoing growth opportunities within the category. As we had anticipated, the Forerunner 10 was a popular holiday gift and we expect the momentum from that product to continue in 2013. In addition, we recently launched the connected Edge 510 and 810 for the cycling community, which offer live tracking capabilities. The product pipeline is robust, driving our expectations for growth in 2013.”
