GET DAILY SIGNALSGarmin (GRMN) Reports Record Q3 Revenue and Raises Full-Year 2026 Outlook
Key Takeaways
- Garmin posted record third-quarter revenue of $1.99 billion, up 12% year over year, led by strong fitness, outdoor, and marine demand.
- Pro forma EPS reached $2.76, up 39% year over year and above consensus; GAAP EPS was $2.80.
- Operating income rose 34% to a record $612 million, while gross margin expanded to 63.3% and operating margin to 30.8%.
- Management raised full-year 2026 guidance to approximately $8.15 billion in revenue and $10.80 in pro forma EPS.
- Auto OEM revenue declined 20%, the quarter's main weak spot amid an ongoing domain controller transition.
- Rising memory and component costs were flagged as a margin headwind heading into 2027.
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Why This Quarter Matters
Garmin's third quarter of fiscal 2026, which ended September 26, 2026, offers a useful checkpoint for the company's broad GPS-driven portfolio. After a period of steady gains in wearables and adventure watches, this report helps confirm whether premium product launches can maintain double-digit growth while holding onto strong profitability. The results stand out because Garmin operates across five distinct areas—fitness, outdoor, aviation, marine, and auto OEM—and its ability to post record margins even as component costs rise points to solid pricing power and operational focus. The updated full-year outlook adds to the sense of confidence heading into the holiday period.
Quarterly Results in Detail
Consolidated revenue came in at $1.99 billion, a 12% increase from the year-ago quarter and close to what analysts had expected. Pro forma EPS of $2.76 jumped 39% year over year and beat estimates by roughly $0.37, while GAAP diluted EPS reached $2.80, up from $2.08. Net income rose to $541.7 million from $401.6 million. I also checked this using Tickeron’s AI Screener to see how the stock compares to others in the industry.
Profitability showed clear improvement. Operating income increased 34% to a record $612 million, pushing the operating margin to 30.8%. Gross margin expanded to 63.3%, up 420 basis points, supported by a favorable segment mix, a weaker Taiwan dollar, and about $33 million in tariff refunds.
Segment performance varied. Fitness revenue grew 16% to $694 million, outdoor revenue climbed 20% to $597 million, marine revenue rose 16% to $310 million, and aviation revenue increased 5% to $253 million. Auto OEM revenue fell 20% to $132 million as domain controller sales continued to decline ahead of the expected Mercedes-Benz program launch.
Management lifted its full-year 2026 outlook, now expecting revenue of about $8.15 billion, pro forma EPS of $10.80, a gross margin near 61%, and an operating margin around 29%.
Market Reaction
Even with the earnings beat and raised guidance, GRMN shares moved lower after the report, with indications of a roughly 6% decline in the session. The response seemed driven more by forward concerns than by the strong quarter. Management highlighted that rising memory and raw material costs—previously offset by lower-cost inventory—will start to weigh on gross margins, with the overall margin profile expected to move back toward historical levels in 2027. Lower free cash flow, tied to higher inventory and prepayments for components, added to the cautious tone. Investors appear to be balancing the solid holiday setup against these cost pressures and the current valuation.
Looking Ahead
The key question going forward is how quickly higher memory and component costs will affect results. Management guided for a full-year gross margin of about 61%, but expects the consolidated margin to settle back toward longer-term norms in 2027 as more expensive memory enters production. How well the company manages this through vertical integration, scale, and selective pricing will be worth watching.
On the demand side, the holiday quarter will show whether recent product momentum holds. Launches such as the fēnix 9 and fēnix 9 Pro watches, the new CIRQL Smart Ring in fitness, and LiveScope 2 in marine should help support fourth-quarter growth. Fitness looks likely to remain the strongest growth driver for the year.
Attention will also turn to the auto OEM segment, where revenue is declining as planned. The upcoming Mercedes-Benz domain controller program is expected to support growth in 2027, so its timing and ramp-up will be important. Finally, cash generation deserves monitoring: Garmin now projects full-year 2026 free cash flow of about $1.1 billion, down from its earlier estimate due to inventory builds and component prepayments. Balancing product availability with rising working capital needs will remain a focus in the coming quarters.
Using Tickeron Tools in My Research
I find Tickeron’s AI Screener helpful for quickly filtering stocks by technical patterns, fundamentals, and AI signals when reviewing names like GRMN. It lets me compare performance across sectors and spot ideas worth a closer look without spending hours on manual screens. The platform’s customizable filters make it straightforward to check trends and volatility alongside the latest earnings data.
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Contributor
Sergey Savastiouk, Ph.D. has a degree in Applied Mathematics from Moscow University and has extensive experience as an entrepreneur, investor, manager, and mathematician. His professional expertise is in applied mathematics, mathematical modeling, system and pattern analysis, and software and hardware system integration. He has served as the CEO of several hi-tech start-up companies and nonprofit organizations, which has given him proven capabilities in business strategy for high-tech start-up companies, market assessment, company formation, team building, product development, marketing, and sales. He has published numerous articles in journals and magazines on related fields. As a retail investor, he spent 15 years developing his proprietary trading and quantitative algorithms (now Tickeron’s A.I.), which brought him significant returns in trading the stock market. His current work and goal in founding Tickeron is to bring professional, sophisticated stock market analysis capabilities to retail investors via an easy-to-use interface.
GRMN in upward trend: price rose above 50-day moving average on October 19, 2026
GRMN moved above its 50-day moving average on October 19, 2026 date and that indicates a change from a downward trend to an upward trend. In 33 of 47 similar past instances, the stock price increased further within the following month. The odds of a continued upward trend are 70%.
Technical Analysis (Indicators)
Bullish Trend Analysis
The RSI Indicator points to a transition from a downward trend to an upward trend -- in cases where GRMN's RSI Indicator exited the oversold zone, 14 of 23 resulted in an increase in price. Tickeron's analysis proposes that the odds of a continued upward trend are 61%.
The Momentum Indicator moved above the 0 level on October 15, 2026. You may want to consider a long position or call options on GRMN as a result. In 59 of 91 past instances where the momentum indicator moved above 0, the stock continued to climb. The odds of a continued upward trend are 65%.
The Moving Average Convergence Divergence (MACD) for GRMN just turned positive on October 16, 2026. Looking at past instances where GRMN's MACD turned positive, the stock continued to rise in 30 of 49 cases over the following month. The odds of a continued upward trend are 61%.
The 10-day moving average for GRMN crossed bullishly above the 50-day moving average on October 23, 2026. This indicates that the trend has shifted higher and could be considered a buy signal. In 11 of 16 past instances when the 10-day crossed above the 50-day, the stock continued to move higher over the following month. The odds of a continued upward trend are 69%.
Following a +1.74% 3-day Advance, the price is estimated to grow further. Considering data from situations where GRMN advanced for three days, in 215 of 336 cases, the price rose further within the following month. The odds of a continued upward trend are 64%.
GRMN may jump back above the lower band and head toward the middle band. Traders may consider buying the stock or exploring call options.
The Aroon Indicator entered an Uptrend today. In 159 of 261 cases where GRMN Aroon's Indicator entered an Uptrend, the price rose further within the following month. The odds of a continued Uptrend are 61%.
Bearish Trend Analysis
The Stochastic Oscillator demonstrated that the ticker has stayed in the overbought zone for 7 days. The longer the ticker stays in the overbought zone, the sooner a price pull-back is expected.
Following a 3-day decline, the stock is projected to fall further. Considering past instances where GRMN declined for three days, the price rose further in 50 of 62 cases within the following month. The odds of a continued downward trend are 54%.
Fundamental Analysis (Ratings)
The Tickeron Profit vs. Risk Rating rating for this company is 21 (best 1 - 100 worst), indicating low risk on high returns. The average Profit vs. Risk Rating rating for the industry is 81, placing this stock better than average.
The Tickeron Price Growth Rating for this company is 43 (best 1 - 100 worst), indicating steady price growth. GRMN’s price grows at a higher rate over the last 12 months as compared to S&P 500 index constituents.
The Tickeron PE Growth Rating for this company is 44 (best 1 - 100 worst), pointing to consistent earnings growth. The PE Growth rating is based on a comparative analysis of stock PE ratio increase over the last 12 months compared against S&P 500 index constituents.
The Tickeron SMR rating for this company is 44 (best 1 - 100 worst), indicating strong sales and a profitable business model. SMR (Sales, Margin, Return on Equity) rating is based on comparative analysis of weighted Sales, Income Margin and Return on Equity values compared against S&P 500 index constituents. The weighted SMR value is a proprietary formula developed by Tickeron and represents an overall profitability measure for a stock.
The Tickeron Valuation Rating of 78 (best 1 - 100 worst) indicates that the company is slightly overvalued in the industry. This rating compares market capitalization estimated by our proprietary formula with the current market capitalization. This rating is based on the following metrics, as compared to industry averages: P/B Ratio (6.180) is normal, around the industry mean (1.413). P/E Ratio (29.676) is within average values for comparable stocks, (7.202). Projected Growth (PEG Ratio) (3.126) is also within normal values, averaging (5.470). Dividend Yield (0.015) settles around the average of (0.011) among similar stocks. P/S Ratio (6.988) is also within normal values, averaging (32.028).
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Fundamental Analysis Ratings
The average fundamental analysis ratings, where 1 is best and 100 is worst, are as follows
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General Information
a manufacturer of navigation and communications equipments
Industry ElectronicEquipmentInstruments
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