Garmin revenue up due to Fenix 5 sales
Despite a slump in fitness tracker sales, Garmin International Inc. bolstered revenue with its bet on high-end smartwatches.
The Olathe-based consumer electronics company (Nasdaq: GRMN) reported second-quarter revenue of $817 million, up 1 percent from the prior year, and operating income of $203 million. Garmin’s stock jumped 5.5 percent to $52.73 soon after the market opened Wednesday.
Revenue in Garmin’s outdoor segment jumped 46 percent from 2016, bringing in $194.8 million. The segment hosts many of Garmin’s high-end wearables, including its Fenix series of multisport smartwatches.
High demand for wearables and activity trackers
“The demand for advanced wearables was particularly strong, but was partially offset by negative trends in the activity tracker market,” Garmin CEO Cliff Pemble said in a release. “Our results thus far give us confidence in raising our outlook for the remainder of the year.”
The company previously expected a decline in activity tracker sales based on the second half of 2016. Fitness segment revenue declined 15 percent in the second quarter, bringing revenue of $124.1 million.
The company’s auto segment also has been shrinking steadily as more consumers turn to the GPS in their smartphones. Garmin’s auto revenue decreased 15 percent, though it still remains the company’s largest segment, at $208.5 million.