[February 21, 2018]

Garmin Reports Solid Fiscal 2017 Revenue and Operating Income Growth; Proposes Dividend Increase

Garmin Ltd. (Nasdaq: GRMN) today announced results for the fourth quarter and fiscal year ended December 30, 2017.

Highlights for the fourth quarter 2017 include:

• Total revenue of $888 million, growing 3% over the prior year quarter, with outdoor, fitness, marine and aviation collectively growing 9% over the prior year quarter and contributing 78% of total revenue
• Gross margin improved to 56.2% compared to 54.7% in the prior year quarter
• Operating margin improved to 20.2% compared to 18.6% in the prior year quarter
• Operating income of $179 million, representing growth of 12%
• GAAP EPS was $0.73 for the fourth quarter, representing growth of 2% and pro forma EPS⁽¹⁾ was $0.79 for fourth quarter 2017, representing growth of 9%
• Delivered our one-millionth certified aviation product demonstrating our long history of innovation and contribution to the aviation industry
• Began shipping our updated marine ECHOMAP™ and STRIKER™ products bringing connectivity to the water

Highlights for the fiscal year 2017 include:

• Total revenue of $3,087 million, growing 2% over the prior year, with outdoor, fitness, marine and aviation collectively growing 9% over the prior year and contributing 76% of total revenue
• Gross and operating margins of 57.8% and 21.7%, respectively, both improving from 2016 levels
• Operating income of $669 million, representing 7% growth
• GAAP EPS was $3.68 and pro forma EPS⁽¹⁾ was $2.94
• Shipped over 15 million units and over 188 million since inception
• Completed the acquisition of Navionics®S.p.A., a privately-held worldwide provider of electronic navigational charts and mobile applications for the marine industry
• Strong demand for the fenix® line of wearables led to significant growth in our outdoor segment
• Connect IQ™ app store continued growth with over 3,500 apps and over 45 million downloads since inception
• Garmin ranked #41 on Forbes' "The Just 100: America's Best Corporate Citizens" and ranked as one of the Global 2000 World's Best Employers

Executive Overview from Cliff Pemble, President and Chief Executive Officer:

"2017 was our second full year of sales and operating income growth driven by strong sales in our outdoor, aviation and marine segments," said Cliff Pemble, president and chief executive officer of Garmin Ltd. "Entering 2018, we see additional growth opportunities ahead and we believe that we are well positioned to seize these opportunities with a strong lineup of products."

Outdoor:

The outdoor segment grew 16% in the quarter with significant contributions from wearable devices combined with growth of inReach^® subscription services. Gross and operating margins improved to 63% and 36%, respectively, resulting in 26% operating income growth. We expect outdoor to continue to be a growth segment in 2018 as we leverage opportunities in wearables and other product categories in the segment.

Aviation:

The aviation segment posted solid revenue growth of 11% in the quarter with growth contributions from both aftermarket and OEM. Gross and operating margins remained strong at 75% and 32%, respectively, resulting in 27% operating income growth. During the quarter, we delivered the 500^th G1000® integrated flight deck upgrade for King Air aircraft, witnessed continued strength in our ADS-B offerings, and Textron Aviation announced our selection as the avionics provider for the Cessna Sky Courier 408. We continue to invest in upcoming certifications with our numerous OEM partners, as well as ongoing aftermarket opportunities for long-term market share gains.

Marine:

The marine segment posted strong fourth quarter revenue growth of 24% driven by our updated lineup of chartplotters and fishfinders, as well as contributions from our recently acquired Navionics product line. Gross margin improved to 55%. During the fourth quarter, we recorded a one-time accrual for a litigation settlement resulting in an operating loss in the marine segment of 13%. During the fourth quarter, we began shipping our new connected offerings in our popular ECHOMAP and STRIKER product lines enabling connectivity through our new ActiveCaptain™ mobile app. We expect marine to be a growth segment in 2018 as we focus on market share gains and new product innovations.

Fitness:

The fitness segment posted revenue growth of 1% in the quarter driven by our GPS enabled products, partially offset by declines in our basic activity trackers. Gross and operating margins increased to 53% and 21%, resulting in a 24% growth in operating income. Our recently announced Forerunner® 645 Music brings both music and Garmin Pay™ to a wearable with advanced features such as running dynamics and connectivity. We continue to see growth opportunities in our advanced wearables offset by declines in our basic activity trackers.

Auto:

The auto segment recorded revenue decline of 14% in the quarter, primarily due to the ongoing PND market contraction, partially offset by solid growth in OEM and niche categories. Gross margin declined to 41%, and operating margin was flat at 9%. At the recent Consumer Electronics Show, we announced our new OEM scalable infotainment platform with Amazon Alexa digital assistant integration. Looking forward, we are focused on disciplined execution to bring desired innovation to the market and to optimize profitability in this segment.

Additional Financial Information:

Total operating expenses in the quarter were $320 million, a 3% increase from the prior year. Research and development investment increased 3%, due to engineering personnel costs and the Navionics acquisition partially offset by the additional week of expense in 2016. Selling, general and administrative expenses increased 13%, due primarily to litigation related costs and the Navionics acquisition. Advertising decreased 13%, primarily due to lower media spend in the fitness segment.

The effective tax rate in the fourth quarter of 2017 was 23.1%. The pro forma effective tax rate in the fourth quarter of 2017 was 20.9% (see attached table for reconciliation of this non-GAAP measure), compared to an effective tax rate of 19.0% in the prior year quarter. The increase in the pro forma effective tax rate is primarily due to the Company's election to align certain Switzerland corporate tax positions with evolving international tax initiatives and the impact of the release of reserves partially offset by income mix by tax jurisdiction.

In the fourth quarter of 2017, we generated $144 million of free cash flow (see attached table for reconciliation of this non-GAAP measure) and returned cash to our shareholders with our quarterly dividend of $96 million. We ended the quarter with cash and marketable securities of approximately $2.3 billion.

2018 Guidance:

We currently expect 2018 revenue of approximately $3.2 billion as growth in marine, outdoor and aviation is partially offset by ongoing declines in the PND market. We currently expect our full year pro forma EPS will be approximately $3.05 based upon gross margin of approximately 58.5%, operating margin of approximately 21% and a full year pro forma effective tax rate of approximately 19%.

Effective in the first quarter 2018, the Company adopted Accounting Standards Codification (ASC) Topic 606, the new revenue recognition standard. The 2018 revenue and segment revenue growth percentages are based upon the restated 2017 revenue amounts. We have included additional appendices (Appendix A and B) with 2017 results reflecting the new revenue recognition standard to help investors understand the comparability of the 2018 guidance.

Dividend Recommendation:

The board of directors intends to recommend to the shareholders for approval at the annual meeting to be held on June 8, 2018, a cash dividend in the amount of $2.12 per share (subject to possible adjustment based on the total amount of the dividend in Swiss Francs as approved at the annual meeting), payable in four equal installments on dates to be determined by the Board. The Board currently anticipates the scheduling of the dividend in four installments as follows:

In addition, the board of directors has established March 30, 2018 as the payment date and March 15, 2018 as the record date for the final dividend installment of $0.51 per share, per the prior approval at the 2017 annual shareholders' meeting. The first, second and third payments of $0.51 per share were made on June 30, 2017, September 29, 2017, and December 29, 2017, respectively.

Webcast Information/Forward-Looking Statements:

The information for Garmin Ltd.'s earnings call is as follows:

An archive of the live webcast will be available until February 28, 2019 on the Garmin website at www.garmin.com. To access the replay, click on the Investor Relations link and click over to the Events Calendar page.

This release includes projections and other forward-looking statements regarding Garmin Ltd. and its business that are commonly identified by words such as "would," "may," "expects," "estimates," "plans," "intends," "projects," and other words or phrases with similar meanings. Any statements regarding the Company's GAAP and pro forma estimated earnings, EPS, and effective tax rate, and the Company's expected segment revenue growth rates, consolidated revenue, gross margins, operating margins, currency movements, expenses, pricing, new products to be introduced in 2018, statements relating to possible future dividends and the Company's plans and objectives are forward-looking statements. The forward-looking events and circumstances discussed in this release may not occur and actual results could differ materially as a result of risk factors and uncertainties affecting Garmin, including, but not limited to, the risk factors that are described in the Annual Report on Form 10-K for the year ended December 30, 2017 filed by Garmin with the Securities and Exchange Commission (Commission file number 0-31983). A copy of Garmin's 2017 Form 10-K can be downloaded from http://www.garmin.com/aboutGarmin/invRelations/finReports.html. Any forward-looking statements made in this release speak only as of the date of this release.

Non-GAAP Financial Measures

This release and the attachments also contain non-GAAP financial measures. A reconciliation to the nearest GAAP measure and a discussion of the Company's use of these measures are included in this release or the attachments.

Garmin, the Garmin logo, the Garmin delta, fenix, Forerunner, G1000, inReach and Navionics are registered trademarks of Garmin Ltd. or its subsidiaries and are registered in one or more countries, including the U.S.; Active Captain, Connect IQ, ECHOMAP, Garmin Pay, Garmin Speak and STRIKER are trademarks of Garmin Ltd. or one of its subsidiaries. All other brands, product names, company names, trademarks and service marks are the properties of their respective owners. All rights reserved.

Non-GAAP Financial Information

To supplement our financial results presented in accordance with GAAP, this release includes the following measures defined by the Securities and Exchange Commission as non-GAAP financial measures: pro forma net income (earnings) per share, forward-looking pro forma earnings per share, pro forma effective tax rate, forward-looking pro forma effective tax rate and free cash flow. These non-GAAP measures are not based on any comprehensive set of accounting rules or principles and should not be considered a substitute for, or superior to, financial measures calculated in accordance with GAAP, and may be different from non-GAAP measures used by other companies, limiting the usefulness of the measures for comparison with other companies. Management believes providing investors with an operating view consistent with how it manages the Company provides enhanced transparency into the operating results of the Company, as described in more detail by category below.

The tables below provide reconciliations between the GAAP and non-GAAP measures.

Pro forma effective tax rate

The Company's income tax expense is periodically impacted by discrete tax items that are not reflective of income tax expense incurred as a result of current period earnings. Therefore, management believes disclosure of the effective tax rate and income tax provision before the effect of such discrete tax items are important measures to permit investors' consistent comparison between periods. In fiscal 2016, there were no such discrete tax items identified.

The net release of uncertain tax position reserves, amounting to approximately $17.9 million and $11.9 million for the 52-weeks and 53-weeks ended December 30, 2017 and December 31, 2016, respectively, have not been included as pro forma adjustments in the above presentation of pro forma income tax provision as such items tend to be more recurring in nature.

Pro forma net income (earnings) per share

Management believes that net income (earnings) per share before the impact of foreign currency gains or losses and certain discrete income tax items, as discussed above, is an important measure in order to permit a consistent comparison of the Company's performance between periods.

Free cash flow

Management believes that free cash flow is an important financial measure because it represents the amount of cash provided by operations that is available for investing and defines it as operating cash less capital expenditures for property and equipment. Management believes that excluding purchases of property and equipment provides a better understanding of the underlying trends in the Company's operating performance and allows more accurate comparisons of the Company's operating results to historical performance. This metric may also be useful to investors, but should not be considered in isolation as it is not a measure of cash flow available for discretionary expenditures. The most comparable GAAP measure is cash provided by operating activities.

Forward-looking pro forma tax rate

Forward-looking pro forma tax rate and pro forma earnings per share are calculated before the effect of certain discrete tax items. Management believes certain discrete tax items may not be reflective of income tax expense incurred as a result of current period earnings. Therefore, in order to permit consistent comparison between periods, the tax rate and earnings per share before the effect of such discrete tax items are important measures. In the 52-weeks ended December 30, 2017, such discrete tax items were recognized on a U.S. GAAP-basis that would have affected comparability between periods and were therefore removed from the pro forma tax rate. However, at this time management is unable to determine whether or not significant discrete tax items will be identified in fiscal 2018.

Forward-looking pro forma earnings per share (EPS)

Our 2018 pro forma EPS excludes foreign currency exchange gains and losses. The estimated impact of such foreign currency gains and losses cannot be reasonably estimated on a forward-looking basis due to the high variability and low visibility with respect to non-operating foreign currency exchange gains and losses and the related tax effects of such gains and losses. The impact of such foreign currency gains and losses, net of tax effects, was $0.04 and $0.09 per share for the 13-weeks and 52-weeks ended December 30, 2017, respectively.

Appendix A - Fiscal 2018 revenue recognition accounting change

The following appendices present 2017 results restated to reflect Accounting Standards Codification (ASC) Topic 606, Revenue from Contracts with Customers. These appendices provide comparable information to help investors understand the 2018 guidance.

We adopted ASC Topic 606, Revenue from Contracts with Customers ("ASC Topic 606"), the new revenue recognition standard, in the first quarter of 2018, effective for Garmin's fiscal year ending December 29, 2018. ASC Topic 606 replaces existing revenue recognition rules with a comprehensive revenue measurement and recognition standard.

Adoption approach

The Company has adopted the new revenue recognition standard utilizing the full retrospective method. Under this method, the new recognition standard is applied to each prior period reported in the forthcoming 2018 Form 10-Q and Form 10-K filings. This adoption approach enhances comparability, as all periods presented in the forthcoming filings are reported under the new standard. We have provided relevant information below to highlight the financial impact of the new revenue recognition standard, and have also provided relevant restated financial statements under ASC Topic 606 in the following appendix.

ASC Topic 606 impacts

Based on our evaluation of the new revenue standard, Garmin's recognition will be consistent with our previous accounting policies except for two impacts, both of which are within the Company's auto segment:

• A portion of the Company's auto segment contracts have historically been accounted for under Accounting Standards Codification Topic 985-605 Software-Revenue Recognition (Topic 985-605). Under Topic 985-605, the Company deferred all elements of multiple-element software arrangements if vendor-specific objective evidence of fair value (VSOE) could not be established for an undelivered element (e.g. map updates). In applying the new revenue standard to certain contracts that include both software licenses and map updates, we recognize the portion of revenue related to the software license at the time of delivery rather than ratably over the map update period.
• For certain multiple-element arrangements within the Company's auto segment, the Company's previous policy was to allocate consideration to traffic services and recognize it ratably over the estimated life of the underlying product. Under the new revenue standard, we recognize revenue related to certain traffic services at the time of hardware and/or software delivery. Specifically, the new revenue standard emphasizes the timing of the Company's performance, and upon delivery of the navigation device and/or software, the Company has performed its obligation with respect to the design and production of the product to receive and interpret the broadcast traffic signal for the benefit of the end user.

Both changes noted above accelerate the timing of revenue recognition. See below for an overview of the financial impact to the Company's results of operations:

The Company's historical net cash flows provided by or used in operating, investing, and financing activities are not impacted by adoption of the new revenue standard.

Within Appendix A and Appendix B, the references to periods such as "FY 17," "Q1 17," or "2017," refer to the corresponding periods or period-end dates as reported in the applicable Form 10-K or Form 10-Q filings. See additional restated financial information below within Appendix B.

APPENDIX B - Restated financial information under ASC Topic 606

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