Garmin -6.2%; guidance hiked, foreign cash to be repatriated

With a big Q2 beat on the books, Garmin (NASDAQ:GRMN) now expects 2014 revenue of $2.75B-$2.85B and EPS of $2.95-$3.05, above prior guidance of $2.6B-$2.7B and $2.50-$2.60; consensus is at $2.71B and $2.77.

The company also says it will repatriate cash by moving "certain US subsidiaries out from under our Taiwanese subsidiary." Garmin will make $300M in related tax payments over the next year, and declares the action will allow it to "fund dividends, share repurchases, and acquisitions."

Auto/mobile sales (45% of revenue) +2% Y/Y in Q2 to $350M. Fitness +79% Y/Y to $150.7M thanks to vivofit fitness band demand and new biking/running product launches. Outdoor -1% to $106.1M, aviation +11% to $97.3M, marine +1% to $73.8M.

Gross margin was 57%, even with Q1 and up from 55% a year ago; a 65% fitness GM provided a boost. GAAP opex +6% Y/Y to $225.7M. $129M was spent on buybacks.

Ahead of the repatriation, Garmin ended Q2 with $2.8B in cash/investments, and no debt.

Q2 results, PR

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