Question · Q3 2025
Ben Bolin asked about the accrued incremental warranty costs in the Auto OEM segment and the long-term margin structure for that segment. He also inquired about the broader component supply environment, specifically regarding advanced process nodes and memory component availability given hyperscale demand.
Answer
President and CEO Cliff Pemble clarified that the accrued warranty cost was an isolated issue affecting prior period sales, which has since been addressed and corrected. He reiterated the long-term target for Auto OEM margins: mid to upper teens gross margin and mid single-digit operating margin at scale. Regarding component supply, he acknowledged impacts from AI and data center initiatives, but sees a long-term benefit for customers and Garmin through higher-performance processors and denser memory, leading to enhanced product features and capabilities.