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UPDATE 1-Garmin's revenue beats on healthy demand for fitness products
April 27, 2016 / 11:42 AM / in 2 years

UPDATE 1-Garmin's revenue beats on healthy demand for fitness products

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April 27 (Reuters) - Garmin Ltd reported a better-than-expected rise in quarterly revenue as strong demand for its GPS-based fitness devices more than offset a decline in sales of navigation products used in vehicles.

Sales in the core auto segment, the company’s biggest unit, fell for the seventh straight quarter to $195.6 million as consumers increasingly opt for phone apps that offer many of the same features as Garmin’s standalone GPS products.

The fitness products unit, however, has been a bright spot for the company.

Sales in the unit, which makes up for a quarter of total sales, jumped 9 percent in the first quarter ended March 26, driven by the Vivo line of wearables and smartwatches.

Sales in Garmin’s outdoor, aviation and marine business, which makes products including altimeters, transponders and sonar-based fishfinders, also increased in the quarter.

The company’s net income rose to $88 million, or 46 cents per share, in the first quarter ended March 26, from $66.8 million, or 35 cents per share, a year earlier.

On a pro-forma basis, Garmin earned 49 cent per share.

Net sales climbed to $624 million from $585.4 million, easily beating the average analyst estimate of $585.9 billion, according to Thomson Reuters I/B/E/S.

Analysts on average had expected profit of 42 cents per share.

Garmin’s stock is up nearly 14 percent this year, mainly boosted by the success of the company’s push into newer products categories such as wearables. (Reporting by Sai Sachin R in Bengaluru; Editing by Saumyadeb Chakrabarty)

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