Garmin announces 3rd quarter results, outdoor/fitness up 35%
Garmin announced third quarter financial results yesterday. I’m always curious to see how the outdoor part of the business does since the Colorado and Oregon are factors in that number. Here are some quotes from the press release:
Outdoor/Fitness segment revenue increased 35% to $119 million in third quarter 2008
Outdoor/Fitness segment revenue increased 37% to $308 million in year-to-date 2008.
Revenue in our outdoor/fitness segment continued to grow rapidly when compared to the year ago quarter due to the strength of our product line-up and an expanding fitness market. Specific growth drivers include the Colorado™ series, the Forerunner® 405, the Edge® 705, and the Oregon™ series, which was just released in the third quarter. We believe this category will continue to perform well during the holidays due to the gift appeal of both the outdoor and fitness products.
Gross margin for the aviation and outdoor/fitness segments remained on target when compared to our long-term targets at 65% and 63%, respectively.
We anticipate annual segment revenue growth rates for our automotive/mobile, outdoor/fitness, and aviation segments to be 13%, 25%, and 7%, respectively.
Given the total third quarter revenue for Garmin was $870m that means that about 13%-14% of the company’s revenue came from outdoor/fitness products which includes the traditional outdoor handhelds as well as the fitness devices like the Forerunner and Edge. I didn’t see any mention of the crossover Nuvi 500 series devices or break down between outdoor and fitness units.
It is interesting to see how the outdoor/fitness devices have much higher margins (65%) versus the ultra competitive automobile PNDs (38%). If you do a quick calculation of average revenue per unit sold in the third quarter it comes out to about $225 — that says most of Garmin’s sales are on the low end Nuvis, not surprising I guess! Either way the outdoor/fitness segment is seeing some solid projected revenue growth (25%) for the year thanks in part to the Colorado and Oregon.
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