Garmin Elevates Outlook as Demand for Wearable Devices Remains Strong

Garmin Ltd. (NYSE:GRMN) raised its full-year revenue and profit forecasts today after delivering a strong performance in the third quarter, exceeding analyst expectations in the fitness segment. The company, known for its GPS technology and wearable devices, anticipates that the launch of new products as the holiday season approaches will further boost sales.

The fitness segment, Garmin's second-largest by revenue, demonstrated significant growth in the first half of the year. This trend continued into the third quarter, with segment revenue reaching $463.9 million, surpassing the analyst consensus estimate of $396.1 million compiled by LSEG.

Garmin's confidence is bolstered by positive metrics indicating an increase in the number of downloads and monthly active users of the Garmin Connect app, designed to sync with the company’s range of wearable devices.

In preparation for the critical holiday shopping season, Garmin has launched new wearable products. Amid economic uncertainty and concerns about consumer and business spending, the company relies on its diversified product portfolio to maintain growth.

The updated full-year revenue projection is now approximately $6.12 billion, reflecting a significant increase from the previous estimate of around $5.95 billion. Additionally, the company raised its pro forma profit expectation from $6.00 per share to $6.85.

For the quarter ending September 30, Garmin reported revenues of $1.59 billion, exceeding the analyst consensus of $1.44 billion. The pro forma profit for the quarter came in at $1.99 per share, which also exceeded the expected $1.44.

Following the announcement, Garmin shares experienced a remarkable increase of 9.5% in pre-market trading. The market's positive reaction reflects investors' optimism regarding the company's performance and future prospects.