Despite surges in three out of the company’s four segments, Garmin Ltd. posted a 1% decrease in total sales for the first quarter of 2010.
Accordingly, sales in the company’s outdoor/fitness, marine and aviation segments increased by 28%, 9% and 12%, respectively. The negative impact derives from a 15% drop in sales for Garmin’s auto/mobile segment, which is larger in comparison to the other three. As a result, the 1% drop landed the company with total revenues amounting $431 million for the quarter ended Mar 27.
In terms of region, revenues increased in Europe and Asia, up 1% and 54% respectively, but slid by 8% in North America to $243 million.
Altogether, gross margins increased to 53.6%, improving 870 basis points over the prior year, equaling a sequential, 777 basis point year-over-year rise of 54%.
Altogether, gross margins increased to 53.6%, improving 870 basis points over the prior year, equaling a sequential, 777 basis point year-over-year rise of 54%.
In addition, operating margin increased year-over-year to 19%, compared to 13% in first quarter 2009. On a GAAP basis, which excluded the currency gains, net income dropped 21% to 19 cents per share from 24 cents in first quarter 2009.
Garmin attributes the rapid growth in the outdoor/fitness segment to the company’s Forerunner 110, a highly intelligent fitness watch that offers real-time data and affordability to consumers. Similar trends were experienced upon the arrival of the Forerunner 405, the predecessor of the 410. “The growth in this segment has occurred on a global basis with all three of our sales territories showing sustained growth,” said Cliff Pemble, president and chief operating officer for Garmin.