Report date: July 29, 2026 (before market open) | Call: 10:30 a.m. ET
Garmin heads into tomorrow's report on a hot streak. The stock closed at $253.69 on July 28, up from roughly $211 a year ago and not far off its April 2026 all-time high near $267. Sentiment has been buoyed by three consecutive quarters of double-digit growth and margin expansion, a raised dividend, a new buyback authorization, and — just last week — a bolt-on acquisition in the fitness/coaching space. But investors should note that Garmin's stock has been anything but calm around earnings: shares jumped double digits after the January-quarter beat in February 2026, but plunged as much as 11% the day after Q3 2025 results when revenue missed estimates by roughly $30 million even though EPS was in line, and gross/operating margins contracted year-over-year. That history is a reminder that this print is a "beat-the-number-and-margins" story as much as a top-line story.
Wall Street is looking for a meaningful deceleration from the blistering growth of the first half of 2025's comps:
Sell-side sentiment is mixed: some trackers show a consensus "Hold" with price targets in the high-$250s to high-$260s (essentially in line with or modestly above the current price), while other aggregations show a "Buy" lean with targets ranging from $208 to $320. Either way, the stock is not obviously cheap relative to near-term estimates, which raises the stakes for guidance commentary.
Q2 2025 comp (the bar to clear): Garmin posted record revenue of $1.815 billion (+20% y/y), with gross margin of 58.8% and operating margin of 26.0% (up from 22.7% a year earlier), and pro forma EPS of $2.17 (+37%). Every segment grew double digits: Fitness +41% to $605M, Outdoor +11% to $490M, Aviation +14% to $249M, Marine +10% to $299M, and Auto OEM +16% to $170M. That is a tough comp, which is exactly why consensus is only modeling high-single-digit revenue growth this quarter.
Q1 2026 (the most recent data point): Garmin delivered a strong start to the year — revenue of $1.753 billion (+14%), gross margin 59.4%, operating margin 24.6%, and pro forma EPS of $2.08 (+29%), beating consensus by double digits. Segment trends to carry into Q2: - Fitness (+42% in Q1) remains the standout — management has flagged it as "the strongest contributor to 2026 consolidated growth," driven by broad-based wearable demand at both entry and premium price points. - Outdoor fell 5% in Q1 against a tough Instinct 3 launch comp, and management explicitly guided that "second quarter outdoor performance [would be] similar to that of Q1," with a stronger back half tied to the timing of new product launches. - Aviation grew 18% in Q1, with management expecting "solid growth throughout the remainder of the year," driven by both OEM and aftermarket demand and a still-healthy aircraft order backlog. - Marine grew 11% in Q1, and management said the segment is "on track to achieve growth consistent with the prior year" (Marine grew 10% for full-year 2025). - Auto OEM was roughly flat in Q1 (+1%) as new infotainment programs offset BMW's peak-and-decline phase; management continues to guide full-year 2026 Auto OEM revenue lower as BMW volumes roll off and legacy programs sunset, with the narrower operating loss persisting until the Mercedes-Benz domain-controller program ramps starting in 2027.
Garmin's formal FY2026 guidance, issued in February and reaffirmed at Q1, calls for:
| Metric | FY2026 Guide |
|---|---|
| Revenue | ~$7.9B (+9% y/y) |
| Gross margin | ~58.5% |
| Operating margin | ~25.5% |
| Pro forma tax rate | ~16.0% |
| Pro forma EPS | $9.35 |
Given Garmin has now delivered Q1 revenue/EPS growth well ahead of that implied full-year pace (14%/29% vs. a 9%/roughly high-single-digit full-year plan), the key question for tomorrow is whether management raises guidance — as it did after Q2 2025's blowout (when it lifted FY2025 revenue guidance to ~$7.1B/EPS to $8.00, only to blow past both with actual results of $7.245B revenue and $8.56 pro forma EPS). Management's stated practice is conservatism early in the year and to "maintain guidance issued in February" through Q1, revisiting only "as the year unfolds" — so a Q2 raise, if it comes, would be a meaningful signal of confidence.
Margin/cost watch items: - Management has said component/tariff cost pressure has been "muted" in 2026 because Garmin is working through safety-stock inventory bought before tariffs took effect, but expects the effect to "start to appear more in 2027" as that inventory rolls off — watch for any change in tone here. - No tariff-refund benefit has been recorded in results to date; any change in that policy stance would be a modest tailwind. - FX has been a modest tailwind to reported growth in EMEA/APAC in recent quarters; the strength (or reversal) of the dollar into Q2 is worth watching for its influence on the print. - Operating expenses have been guided to be roughly flat as a percentage of sales in FY2026 versus FY2025.
Garmin remains a self-funding compounder. As of Q1 2026 quarter-end, the company held ~$4.3 billion in cash and marketable securities, generated $469 million of free cash flow in the quarter (up from $381M a year earlier), and paid a quarterly dividend of $1.05/share (part of a $4.20 annualized rate, a 17% increase approved for 2026) while repurchasing shares under a new $500 million buyback authorized through December 2028 ($491M remaining as of Q1-end). None of this is likely to be a surprise, but confirmation of continued buyback pacing and capital-allocation priorities (organic R&D vs. further M&A like TrainingPeaks) will matter for the multiple.