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FY2025 Q4
Improving
Garmin Ltd. earnings call
Buzzberg read
Fitness segment expected to be strongest contributor to 2026 growth
Garmin reported a record Q4 and full year 2025, with revenue and EPS significantly up across all segments. Management guided to continued strong growth in 2026, expecting revenue of $7.9B and operating income to exceed $2B for the first time, while navigating memory cost pressures. Key cross-company signals include a new $500M buyback, a new Mercedes-Benz program ramping in 2027, and a back-half-weighted outdoor product launch strategy. Record Q4 2025: Revenue $2.125B (+17% YoY), EPS $2.79; Full-year revenue $7.246B (+15% YoY), EPS $8.56.
Buzzberg read Fitness segment expected to be strongest contributor to 2026 growth Garmin reported a record Q4 and full year 2025, with revenue and EPS significantly up across all segments. Management guided to continued strong growth in 2026, expecting revenue of $7.9B and operating income to exceed $2B for the first time, while navigating memory cost pressures. Key cross-company signals include a new $500M buyback, a new Mercedes-Benz program ramping in 2027, and a back-half-weighted outdoor product launch strategy. Record Q4 2025: Revenue $2.125B (+17% YoY), EPS $2.79; Full-year revenue $7.246B (+15% YoY), EPS $8.56. Read full analysisCollapse analysis
Garmin reported a record Q4 and full year 2025, with revenue and EPS significantly up across all segments. Management guided to continued strong growth in 2026, expecting revenue of $7.9B and operating income to exceed $2B for the first time, while navigating memory cost pressures. Key cross-company signals include a new $500M buyback, a new Mercedes-Benz program ramping in 2027, and a back-half-weighted outdoor product launch strategy. Record Q4 2025: Revenue $2.125B (+17% YoY), EPS $2.79; Full-year revenue $7.246B (+15% YoY), EPS $8.56.
- FY2026 guidance: Revenue ~$7.9B (+9% YoY), Operating income >$2B, Gross margin 58.5%, Operating margin 25.5%, Pro forma EPS ~$9.35.
- Fitness was the standout segment, with revenue up 42% in Q4 and 33% annually, driven by wearables.
- Auto OEM segment to decline in 2026 as BMW domain controller volumes peak and legacy programs wind down, but new Mercedes-Benz program to ramp in 2027.
Revenue$2.125BReported
EPS$2.79Reported
Gross margin59.21%Reported
Operating margin28.9%Reported
6 grounded callouts
What matters now
The highest-signal changes from the call.
Product Launches
Outdoor growth to accelerate in 2026 with back-half loaded launches
Auto OEM
Mercedes-Benz domain controller program ramping in 2027
Show 3 more callouts
Capex
New manufacturing facility in Thailand for 2027
AI
Connect Plus nutrition feature boosts trials with high conversion
Buybacks
Share repurchase program expanded to $500 million through 2028
Reported period
Actuals
| Metric | Reported | Change |
|---|---|---|
| Revenue | $2.125B | Reported |
| EPS | $2.79 | Reported |
| Gross margin | 59.21% | Reported |
| Operating margin | 28.9% | Reported |
| Free cash flow | $0.4296B | Reported |
| Capex | $0.1242B | Reported |
Forward-looking
Forward guidance
| Metric | Period | Range | Midpoint | Status |
|---|---|---|---|---|
| Capex | FY2026 | $0.4B | $0.4B | Initiated |
| EPS | FY2026 | $9.35 | $9.35 | Initiated |
| Free cash flow | FY2026 | $1.4B | $1.4B | Initiated |
| Gross margin | FY2026 | 58.5% | 58.5% | Initiated |
| Operating margin | FY2026 | 25.5% | 25.5% | Initiated |
| Revenue | FY2026 | $7.9B | $7.9B | Initiated |
AI, capex & demand read
Management read
Confident
Management emphasized record results, strong forward guidance, and readiness for supply chain challenges, projecting another year of strong growth.
Management AI read
Management discussed AI-based active intelligence for nutrition tracking in Connect Plus, which accelerated free trials and saw very high conversion rates. They also introduced an AI assistant in their next-gen auto domain controller with Meta collaboration.
Investment and capacity
Capital expenditures are expected to increase year-over-year to approximately $400 million in 2026, primarily due to a new manufacturing facility in Thailand, expected to be operational in early 2027.
all 2 named companies below
Companiesreturns since call
Customers
Customers
Cliff Pimble
Mercedes-Benz is a major new customer for Garmin's automotive domain controllers; the program is expected to ramp aggressively starting in early 2027, becoming a key growth driver for the Auto OEM segment.
Evidence
“This program is with renowned global automaker Mercedes-Benz and will broadly apply across their portfolio passenger car models with significant volumes ramping up in 2027.”
Partners
Partners
Cliff Pimble
Meta is a partner in exploring automotive cabin interaction; early phase, no volume or revenue impact yet.
Evidence
“we also announced our collaboration with Meta to explore new ways of interacting with the vehicle.”
External signals
Supply-chain alpha · 2returns since call
Garmin is proactively building inventory of certain components and products to buffer against expected memory cost pressures and supply constraints, and its vertically integrated model reduces BOM impact.
Evidence
“we have intentionally increased inventory levels of certain components and products to ensure we can meet long-term demand... our overall margin structure is higher and that's because we're a vertically integrated company.”
Garmin's launch cadence for outdoor segment in 2026 is back-half weighted, suggesting the next major outdoor product refresh will not hit until late in the year, potentially ceding the holiday quarter to competitors.
Evidence
“We expect full year growth in outdoor to accelerate in 2026 compared to 2025, driven by a significant number of new product introductions... stronger in the back half of the year due to the timing of product launches.”
Methodology & coverage
Management-only analysis. All 2 validated company mentions are shown. Reported actuals and forward guidance are kept separate. Public evidence is limited to eight short attributed quotes. AI-generated analysis can be incomplete or wrong; verify important claims against the original source.