Shares surged 13.9% to $288.80 Wednesday morning — blowing past the prior all-time high of $273.32 — after Garmin delivered a Q2 that wasn't just good but dramatically better than what Wall Street had penciled in. The size of the beat, and the confidence behind a raised annual outlook, forces investors to decide whether Garmin's premium price tag is justified.
• Earnings Blew Past Expectations by a Wide Margin
Garmin reported $2.81 earnings per share for the quarter, beating analysts' consensus estimates of $2.30 by $0.51.
Revenue hit $2.02 billion, compared to analyst estimates of $1.93 billion. That's a 23% EPS surprise and a nearly $90 million revenue overshoot — the kind of blowout that sends algorithms and fund managers scrambling. Garmin has now surpassed the consensus estimate in each of the trailing four quarters, with an average surprise of 10.3% , but this quarter roughly doubled that pattern.
• Fitness Wearables Are Doing the Heavy Lifting
Consolidated revenue grew 11% year-over-year to a record $2.02 billion, with the Fitness segment surging 25% while Outdoor actually dipped 2%.
Gross margins expanded to 62.4% from 58.8% a year ago, and operating margins widened to 30.4% from 26.0% — a sign that higher-margin smartwatches and subscription-adjacent services are shifting the profit mix. A $21 million refund on previously paid tariffs also gave margins a one-time boost.
• Raised Guidance Signals Management Isn't Worried About a Slowdown
Garmin set full-year EPS guidance at $10.00, above the $9.57 consensus, and raised revenue guidance to $8.1 billion versus analysts' $8.0 billion estimate. That's a meaningful step up from the prior full-year guidance of roughly $7.9 billion in revenue and $9.35 in EPS set after Q1. CEO Cliff Pemble said "performance in the first half of 2026 was very strong, giving us confidence to raise our full-year 2026 consolidated revenue and EPS guidance."
• The Valuation Question Gets Louder At $288.80, Garmin trades at roughly 29 times its new $10.00 EPS target — a steep price for a hardware company, even one growing double digits. The firm's market cap now sits near $55 billion.
Notably, insiders have made 23 stock transactions in the past six months — all sales, zero purchases — a pattern worth monitoring. Investors betting on continued Fitness momentum need to weigh whether a single segment's hot streak can power the whole company to justify today's new record price.