Subscribe to RSSGarmin Sees Weaker Margins in 2010 – Analyst Blog
Garmin Ltd. ( GRMN ) reported fourth quarter earnings that beat the Zacks Consensus Estimate by 47 cents. Revenue Revenue of $1.06 billion was up 35.6% sequentially and 1.1% year over year. This was the first year-over-year increase in five quarters. Volumes were up a whopping 71.2%, driven by seasonality, although the ASP declined 20.8%, mainly due to pricing pressures in Garmin’s core PND product family. The ASP also declined 3.2% from the year-ago quarter, but this was offset by a 4.4% increase in volumes. Strength was broad-based across geographies, although North America witnessed the strongest growth. North America contributed 73% of quarterly revenue (up 52.7% sequentially), Europe 23% (up 3.8%), while Asia accounted for the balance (up 9.8%). Revenue by Segment The Auto/Mobile, Outdoor/Fitness, Aviation and Marine segments generated 77%, 14%, 6% and 3% of fourth quarter revenue, respectively. The Auto/Mobile segment was up 48.8% sequentially but down 1.9% year over year. The sequential increase was driven by seasonality and was across all geographies. Management stated that PND market share was stable during the quarter, with North America share at around 60% and Europe at around 20%. The year-over-year decline was driven by a 6% decline in ASP, partially offset by a 3% increase in volumes. The Outdoor/Fitness segment was up 12.5% sequentially and 24.4% year over year. This segment has picked up faster than the others, with the third straight quarter of double-digit sequential growth and the second straight quarter of double-digit year-over-year growth. New products and changes in consumer behavior have been driving this strength. Additionally, the company also enjoyed positive seasonality in the fourth quarter. The Aviation segment revenue was up 11.4% sequentially but down 4.1% year over year. The weakness was due to lower spending, although retrofit spending fared better than OEM and portable. The Marine segment was down 25.1% sequentially, but up 2.3% year over year. The sequential decline is in line with normal seasonality. The increase from the year-ago period was due to strength …
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Garmin Sees Weaker Margins in 2010 – Analyst Blog
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