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Garmin Reports Third Quarter 2012 Results With Growth In Revenue, Operating Margin And EPS; Raises Full Year EPS Guidance

The outdoor segment posted revenue growth of 11% in the quarter. Growth continued to be driven by our golf line-up, dog tracking and training, and our recently introduced fēnix™. During the quarter, we introduced our first collaborative product following the Tri-Tronics® acquisition, the Alpha GPS Track and Train System. The unit combines robust GPS tracking from Garmin and proven electronic correction from Tri-Tronics.

The fitness segment posted a revenue decline of 6% in the quarter as growth in cycling and multi-sport were offset by a slowdown in running watches. We again faced a difficult year-over-year comparison due to 2011 promotional activity on the Forerunner 305 and the strong early shipments of the Forerunner 610. With the launch of the Forerunner 10, we expect to regain market share in the value price category. Early response to the Forerunner 10 has been positive with great reviews and strong pre-orders. We remain confident that the fitness market will continue to offer growth opportunities in 2013 and beyond.

The aviation segment posted revenue growth of 3% driven by our OEM relationships. The general aviation market remains depressed as evidenced by production levels and we do not foresee any near-term improvement. Yet, we continue to gain market share which will provide accelerated growth in 2013. Most recently, the Garmin G5000 integrated avionics system was selected by Cessna for the upcoming Sovereign refresh which will be delivered to customers in 2013. We now have five new cockpit certifications pending for 2013.

In the marine segment, revenues declined 7% year-over-year as growth in the Americas could not offset the very weak European market. The marine industry continues to be affected by weak economic conditions, as the large boat market has further declined, and we anticipate that the market will remain difficult throughout 2013. Though the near-term remains challenging, we are focusing our resources on the long-term opportunities by continuing to invest in new product development and making strategic acquisitions that broaden our market reach, including Nexus® Marine AB in the third quarter. Nexus is a leading supplier of instrumentation for the sailing market and provides Garmin with immediate expertise and presence in another niche of the marine industry.

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