Garmin Ltd.

Revenue was $2.022 billion, up 11% year over year. Gross margin was 62.4%, up 360 basis points, and operating margin was 30.4%, up 440 basis points. Operating income increased 30% to $616 million; GAAP EPS was $2.80 and pro forma EPS was $2.81. Segment revenue growth included Fitness up 25% to $757 million, Outdoor down 2% to $483 million, Aviation up 8% to $269 million, Marine up 14% to $341 million, and Auto OEM up 1% to $172 million. Full-year 2026 guidance was raised to approximately $8.05 billion of revenue, gross margin of about 59.7%, operating margin of about 27%, pro forma tax rate of 16.5%, and pro forma EPS of about $10.00. Full-year free cash flow is expected to be about $1.4 billion, with capital expenditures of about $550 million.

Cliff Pemble said Garmin had another quarter of record results and that first-half performance gave the company confidence to raise full-year guidance. He emphasized broad-based product strength, especially in Fitness, and pointed to new launches and the Training Peaks/TrainHeroic acquisition as part of a long-term services strategy. His tone was upbeat but measured, noting both strong momentum and a commitment to continue investing in innovation and new categories.

Douglas Boessen detailed the quarter’s financial strength: revenue of $2.022 billion, gross margin of 62.4%, operating margin of 30.4%, and pro forma EPS of $2.81. He said the gross margin benefit came mainly from favorable mix and about $21 million of tariff refunds, and noted that memory costs have not yet meaningfully hit results but are expected to affect the second half. He also cited cash and marketable securities of about $4.4 billion, free cash flow of $276 million, capex of $128 million in Q2, dividends of about $202 million, and $43 million of share repurchases, with about $448 million remaining on the buyback authorization.

Analysts focused on CIRQL, asking whether Garmin’s Connect Plus subscription is required for the most advanced AI features and whether Garmin plans to expand into other wearable form factors. Pemble said CIRQL includes the core Garmin Connect features out of the box, while Connect Plus adds extra features such as AI and nutrition tracking; he also said Garmin’s roadmap remains broad and additional products should follow over time. Other questions centered on margin sustainability, memory chip costs, the auto OEM revenue bridge to the next Mercedes-Benz program, the TrueMed/HSA partnership, Training Peaks/TrainHeroic synergies, and Thailand manufacturing capacity. Management said memory is a near-term headwind, auto OEM revenue should decline in the second half before growth resumes in 2027, and the new acquisitions are meant to create a fuller training ecosystem rather than immediate traditional cost synergies.