e0cf6931fc32f866a82899efce548de6d76a68afcd5e2126cc278d45af0eccce

0a27ae199e67a4b8368afa3ad218c18e6c08601bfbf6de5c55fde2c232badc42

Americas

EMEA

APAC

Total Revenue

5105d8a4befa6f1021fd7453c9a12012544adc2fcfbfe94a1a9d64d3bd56cc1d

Total unit sales (units)

e60a354acc9156e8d84e19b9db5773db2a19069eb24d92404797d746cb383a3b

The increase in Cash and Cash Equivalents in Q3 2024 can be attributed to several factors. **Operating activities** played a significant role by generating **$948,581** in cash, driven by higher net sales and reduced income tax payments.  **[0000950170-24-118582_grmn-20240928.htm:23]**  **Investing activities** improved as cash used decreased due to fewer acquisitions, lower purchases of property and equipment, and a transition from net redemptions to net purchases of marketable securities.  **[0000950170-24-118582_grmn-20240928.htm:23]**  Additionally, **financing activities** saw less cash outflow because of lower purchases of treasury shares, even though there were higher dividend payments.  **[0000950170-24-118582_grmn-20240928.htm:23]**  Lastly, favorable **exchange rate changes** added **$7,536** to the cash balance, contributing to an overall increase of **$315,918** during the period.  **[20241030CG43781:4]** 

What factors contributed to the jump in Cash and Cash Equivalents in Q3 2024?

The notable increase in Total Assets in Q3 2024 was primarily driven by a **rise in Cash and Cash Equivalents**, which increased by **$315,909 thousand**, along with higher **Accounts Receivable** due to increased sales, **Inventories** in preparation for the holiday season and new product launches, and **Marketable Securities** from additional investments. These elements collectively contributed to an overall increase of **$744,163 thousand** in total assets.  **[0000950170-24-118582_grmn-20240928.htm:2]** **[20241030CG43781:4]** **[20241030CG43781:7]** 

What drove the notable increase in Total Assets in Q3 2024?

The **spike** in **Deferred Income Tax Assets** for Q4 2023 was primarily driven by two factors. First, there was a **revaluation of Switzerland Deferred Tax Assets** resulting in an **income tax benefit of $181.4 million**, due to an increase in the combined federal and cantonal statutory tax rate in Switzerland, which was set to take effect in 2024.  **[0000950170-24-017559_grmn-20231230.htm:55]** **[0000950170-24-017559_grmn-20231230.htm:85]** **[0000950170-24-017560_grmn-ex99_1.htm:10]**  Second, **manufacturing tax incentives in Poland** contributed an additional **income tax benefit of $12.1 million**.  **[0000950170-24-017559_grmn-20231230.htm:55]** **[0000950170-24-017560_grmn-ex99_1.htm:11]** **[0000950170-24-017559_grmn-20231230.htm:85]** **[0000950170-24-017560_grmn-ex99_1.htm:10]** 

Why did Deferred Income Tax Assets spike in Q4 2023?

The significant rise in **Marketable Securities** in Q3 2024 was primarily driven by several factors. First, there was a net impact from the **purchases and redemptions** of marketable securities, resulting in a net increase of **$86,449** during the period.  **[0000950170-24-118582_grmn-20240928.htm:3]**  Additionally, **fair value adjustments**—driven by changes in interest rates, credit performance, and other factors—boosted the securities’ fair value by **$121,424**.  **[0000950170-24-118582_grmn-20240928.htm:10]**  A further contribution came from the reduction in **unrealized losses** on these securities, which improved their overall market valuation, in line with Garmin's **investment strategy** that prioritizes capital preservation, liquidity, and yield maximization under low credit risk constraints.  **[0000950170-24-118582_grmn-20240928.htm:10]** 

What factors led to the significant rise in Marketable Securities in Q3 2024?

The **Total Current Liabilities** dropped in Q1 2024 primarily due to a reduction in **Other Accrued Expenses** (a decrease of **$54,400 thousand**), a reduction in **Accrued Sales Program Costs** (down by **$21,018 thousand**), and the elimination of a **dividend payable of $139,997 thousand** that was recorded at the end of 2023.  **[0000950170-24-050879_grmn-20240330.htm:2]** 

What caused Total Current Liabilities to drop in Q1 2024?

89768facf674b7c9e7c34beeafed47431682f1e570d6edb5f4dfffcd117af565

Net sales (USD, thousands)

Cost of goods sold (USD, thousands)

Gross profit (USD, thousands)

Research and development expense (USD, thousands)

Selling, general and administrative expenses (USD, thousands)

Total operating expense (USD, thousands)

Operating income (USD, thousands)

Interest income (USD, thousands)

Foreign currency gains (losses) (USD, thousands)

Other income (USD, thousands)

Total other income (expense) (USD, thousands)

Income before income taxes (USD, thousands)

Income tax provision (USD, thousands)

Net income (USD, thousands)

Basic net income per share (USD)

Diluted net income per share (USD)

Weighted average common shares outstanding - Basic (thousands)

Weighted average common shares outstanding - Diluted (thousands)

c98d1a98f4465a2a65b31bef8dd59ca502f65370a0e869170e55f6fba03c2c48

Fitness

Outdoor

Aviation

Marine

Auto OEM

Auto

- Auto OEM

- Consumer Auto

c7ea15f09b8d5020afc8adc57a5ad5dde5a220007b006b9bca57bee68f06e56a

Adjustments for Non-Cash Items [USD, Thousands]

Stock-Based Compensation [USD, Thousands]

Changes in Working Capital [USD, Thousands]

Capital Expenditures (CapEx) [USD, Thousands]

Proceeds from / Repayments of Debt [USD, Thousands]

Share Repurchases [USD, Thousands]

Dividend Payments [USD, Thousands]

Net Change in Cash [USD, Thousands]

009d3eff7b20587db86b2ed5e5450ee68a71959545188be95ce2e49c4582069c

Total Revenue [USD, Thousands]

Cost of Goods Sold (COGS) [USD, Thousands]

SG&A [USD, Thousands]

R&D [USD, Thousands]

D&A [USD, Thousands]

Interest Expense [USD, Thousands]

Operating Income (EBIT) [USD, Thousands]

Net Income [USD, Thousands]

EPS - Basic [USD, Units]

EPS - Diluted [USD, Units]

7c8d5518d24e020d2c126eb376ae4854e6e2c3307c83623830fc058efcfa2df4

99d1c345c649b1c6c64b5f9e3937451d73956bc8f1f6230a88b0b2a6275ccd81

The jump in Operating Cash Flow was primarily driven by a **lower use of cash for inventory purchases**, as normalized component lead times, improved availability, and eased shipping bottlenecks allowed for better management of inventory. Additionally, **higher net income**—which rose to **$275,961 thousand** in Q4 2023—reflected strong revenue growth and improved operating margins, while **increased accounts receivable** due to seasonally strong sales also played a role.  **[0000950170-24-017560_grmn-ex99_1.htm:14]** **[GRMN_3374232_4]** **[0000950170-24-050879_grmn-20240330.htm:3]** 

What drove the jump in Operating Cash Flow in Q4 2023?

The documents show that **Q1 2024** had a net increase of **$228,318 thousand**  **[0000950170-24-050879_grmn-20240330.htm:3]**  while **Q2 2024** saw a net increase of only **$15,697 thousand**.  **[0000950170-24-088230_grmn-20240629.htm:3]**  However, the detailed explanation provided in the documents only addresses the **year‐over‐year change** in Q2 (comparing **Q2 2024** to **Q2 2023**) and does not specifically discuss the sharp drop between **Q1 and Q2 2024**. Therefore, while we know the numerical change, the documents do not offer a definitive explanation for the Q1 to Q2 drop.  **[0000950170-24-050879_grmn-20240330.htm:3]** **[0000950170-24-088230_grmn-20240629.htm:3]** **[20240731CG73271:8]** **[0000950170-24-088230_grmn-20240629.htm:23]** 

Why did the net increase in cash drop so sharply in Q2 2024?

Based on the documents, there isn’t any information suggesting that investing outflows were significantly reduced in Q4 2023. Instead, the documents explain that net cash used in investing activities **increased significantly** in Q4 2023 compared to the prior year. This increase was mainly driven by a **substantial rise in cash used for acquisitions** (from **$13,455 thousand** to **$150,853 thousand**), coupled with **lower net redemptions of marketable securities** and a **smaller decrease in purchases of property and equipment** that did not fully offset the other factors.  **[0000950170-24-017559_grmn-20231230.htm:65]** **[0000950170-24-017559_grmn-20231230.htm:66]** **[0000950170-24-017559_grmn-20231230.htm:56]** 

What contributed to the significant reduction in investing outflows in Q4 2023?

The documents do not provide a definitive explanation for why Garmin's **Operating Cash Flow** was significantly lower in Q2 2024 compared to Q1 2024. While one document states that the **Net Cash Provided by Operating Activities** was **435,305** in Q1 2024  **[0000950170-24-050879_grmn-20240330.htm:3]**  and **255,321** in Q2 2024  **[0000950170-24-088230_grmn-20240629.htm:3]** , the detailed reasons provided focus on the first half of 2024 compared to the same period in 2023—including factors like **higher net sales**, **lower cash paid for income taxes**, and changes in **accounts payable** and **inventories**.  **[20240731CG73271:0]**  However, these explanations address year-over-year changes rather than a direct quarter-to-quarter comparison. Therefore, based on the available information, we do not have a definitive answer for the drop from Q1 to Q2 2024.

Why was Operating Cash Flow significantly lower in Q2 2024 compared to Q1 2024?

1e3a4bfa692fe0404f608299e22c5ba921eadf68384bfaaf19518a53dace5455

The **negative income tax provision in Q4 2023** was driven by two discrete tax items: a revaluation of Switzerland deferred tax assets and the recognition of auto OEM manufacturing tax incentives in Poland. Specifically, Garmin revalued its Switzerland deferred tax assets in response to an increase in the combined federal and Schaffhausen cantonal tax rates to approximately **15%**, which generated an income tax benefit of **$181.4 million**. Additionally, tax benefits of **$12.1 million** were recognized from manufacturing-related tax incentives in Poland. These factors combined to yield a **GAAP income tax benefit of $159.1 million** in Q4 2023.  **[0000950170-24-017559_grmn-20231230.htm:55]** **[0000950170-24-017560_grmn-ex99_1.htm:10]** **[GRMN_3374232_15]** 

Why was the income tax provision negative in Q4 2023?

In Q4 2023, the surge in net income was driven by several factors. **Revenue growth** played a key role—with consolidated revenue increasing by **13% year-over-year** to **$1.483 billion**—which was complemented by **gross margin expansion** to **58.3%** and an improvement in **operating margins** to **23.0%**, reflecting better cost management. Additionally, a **27% year-over-year rise** in operating income further underpinned the growth. Notably, the company also benefited from a **$12.1 million income tax benefit** due to auto OEM manufacturing tax incentives and realized **foreign currency gains** of **$19.5 million**, significantly contributing to the net income surge.  **[0000950170-24-017560_grmn-ex99_1.htm:0]** **[GRMN_3374232_1]** **[GRMN_3374232_4]** **[0000950170-24-017560_grmn-ex99_1.htm:11]** **[0000950170-24-017560_grmn-ex99_1.htm:13]** **[0000950170-24-017559_grmn-20231230.htm:63]** 

What drove the surge in net income in Q4 2023?

The spike in EPS in Q4 2023 was primarily driven by **robust revenue growth**, with consolidated revenue increasing by **13% to reach $1.48 billion**, and by **improved margins**, as the gross margin expanded from **57.0% to 58.3%** and the operating margin rose from **20.5% to 23.0%**. This was further supported by a **27% increase in operating income, reaching $340 million**, and a significant jump in GAAP net income from **$293,272 thousand** in Q4 2022 to **$542,125 thousand** in Q4 2023.  **[0000950170-24-017560_grmn-ex99_1.htm:0]** **[GRMN_3374232_4]** **[0000950170-24-017560_grmn-ex99_1.htm:13]** 

What contributed to the spike in EPS in Q4 2023?

The documents explain that net income in Q1 2024 increased by approximately **36%** compared to Q1 2023, highlighting factors like revenue growth and improved margins.  **[20240501CG02516:0]** **[0000950170-24-050880_grmn-ex99_1.htm:0]** **[GRMN_3381821_3]**  However, while the net income in Q1 2024 (**$275,961 thousand**  **[0000950170-24-050879_grmn-20240330.htm:1]** ) is lower than in Q4 2023 (**$542,127 thousand**  **[0000950170-24-017559_grmn-20231230.htm:63]** ), the documents do not provide any detailed explanation for this quarter-over-quarter drop. Therefore, we cannot definitively explain why net income fell significantly from Q4 2023 to Q1 2024 with the available information.  **[0000950170-24-017559_grmn-20231230.htm:63]** **[0000950170-24-050879_grmn-20240330.htm:1]** 

Why did net income drop significantly in Q1 2024?

2979bc56aedba475beac7e22f16c48034f14ea7c84a630083eeb28490c02e6b8

Garmin Ltd (GRMN)

Financials