Garmin Q4 2015 Revenue Drops 3%, Full year down 2%

In the last quarter of 2015 Garmin revenue dropped three percent ($781 million) the company disclosed yesterday in their call with financial analysts. For the full year the revenue was down two percent ($2,820 million).

Gross and operating margins were 52.9% (down from 53.6%) and 18.7% (down from 21.9%), respectively.

Pro forma earning per share was $0.74 (down 4%) for the fourth quarter 2015 and $2.49 for the full year (down 20 percent from $3.10).

Garmin ended the quarter with cash and marketable securities of about $2.4 billion.

“Despite the challenging global economic environment and the intensified competitive landscape of 2015, we finished strong with revenue and margins exceeding our expectations? said Cliff Pemble, CEO of Garmin.

“We are utilizing our robust balance sheet to further diversify our revenue base in adjacent categories with our recently announced acquisitions. We believe we have strong products across all of our business segments and are well positioned as we enter 2016.?

Auto Revenue Down 21% in the Quarter

The small annual revenue drop is entirely due to the sharp decline of the Garmin fishfinder market. Garmin automotive segment (personal Navigation Devices and B2B Automotive) posted a revenue decline of 21% in the fourth quarter. Gross and operating margins were 42% and 13%, respectively.

Revenues were down 15% for the full year and Gross margins and operating margins were 44% and 13% respectively.

Fitness Grows 14%

In comparison the fitness segment posted revenue growth of 14% ($228,7 million) in the quarter. This reflected “the strength of our wellness, running, and cycling product offerings,“ Garmin said.

Gross margin fell to 51% in the quarter, while operating margin declined to 18%. The gross margin decline was driven by holiday promotions and competitive dynamics in certain product categories, as well as product mix within the quarter.

Answering to an analyst question Cliff Pemble said: “we believe we are the market share leader in the GPS-enabled wearable device part of the market. We believe that our share is currently in the low-to-mid 40% range.“

“In 2016, we are targeting revenue growth of approximately 10% in the fitness segment,“ said the Chief Executive.

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15% Annual Growth for Telematics Fleet Tracking in Europe

Swedish market research firm Berg insight published yesterday their annual report on fleet management systems in Europe, reporting that the number of active fleet management systems deployed in commercial vehicle fleets in Europe is expected to reach 8.90 million by 2019, a compound annual growth rate (CAGR) of 15.1 percent, up from 4.40 million in the last quarter of 2014.

Market Led by TomTom

According to Berg Insight, “A group of international aftermarket solution providers have emerged as the leaders on the European fleet management market.“

TomTom Telematics has climbed to the number one spot in Europe ahead of Masternaut. The Dutch company has today about 450,000 vehicles under management in Europe and Masternaut is estimated to have an active installed base of 350,000 units, mainly in France and the UK.

Microlise, Digicore and Trimble have also joined the exclusive group of fleet management providers in Europe having more than 100,000 active devices in the field.

Transics is number one in the heavy trucks segment with an estimated 85,000 active units installed.

Standard line fitment in trucks

Berg Insight also noticed that truck manufacturers are fast growing their subscriber bases in Europe helped by standard line fitment of fleet management solutions. Dynafleet by Volvo, FleetBoard by Daimler and Scania Fleet Management are the most successful with active subscriber bases of 70,000 units, 72,000 units and 88,000 units respectively end of 2014.

High number of mergers and acquisitions

A significant number of acquisitions happened in 2015.

“Nine major mergers and acquisitions have taken place in the past year among the vendors of fleet management systems in Europeâ€?, said Johan Fagerberg, Senior Analyst at Berg Insight.

TomTom acquired Fleetlogic in the Netherlands in December 2014 adding another 27,000 subscribers to its installed base. Fleetmatics acquired Ornicar in February 2015 — a local FM solution provider in France adding around 15,000 vehicle subscriptions. In March 2015, a decision was made to merge the two Danaher Corporation owned companies Navman Wireless and Teletrac. Later in April, Orange Business Services acquired OCEAN that now operates as a subsidiary with the OCEAN brand name.

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Parrot Releases its Flying Action Cam: “Bebop Drone“

Parrot has announced on Friday in a press launch in Paris the availability of its Bebop drone before the end of the month.

The product that was already announced a few months ago (read here) is completely dedicated to the camera system unlike its previous drone where the camera was a feature, not THE product.

The new 14 MP camera takes spheric images that are processed on the fly by the embedded GPU to offer smooth video shots whatever the movement of the drone (even when it flips) and to change the video angle (up, down, left, right) from the smartphone or tablet app that controls the drone.

Compared to the previous version of its drone, this one embeds a GPS/GLONASS receiver, which was previously only offered as an option. It is very helpful for outdoor flying, enabling a “back home“ function where the drone comes back to the location of the smartphone that controls it.

Bebop drone also has a reduced size compared to previous versions which makes it more portable. However, the battery life remains rather short: 10-11 minutes. Hopefully the company supplies a second battery pack in the box.

The range of the drone has been also improved using the latest wifi technology: WiFi ac. To further extend the range of this product Parrot created a controller (Skycontoller – see image) where the user plugs its tablet and which transmits its Wifi signal up to two kilometers (in the 5 Ghz band allowed in the United States, not in Europe). Without the skycontroller the range of the drone will highly depends on each smartphone/tablet that operate the drone depending on its Wi-Fi technology and its antenna.

The price of the Bebop drone is €499 and the drone plus the skycontroller costs €899. We can expect to have $499 and $899 recommended prices in the United States.

With this new product Parrot definitely positions itself in the mid- to high-end of the market. Its previous consumer product, AR Drone, was offered for around €350.

Watch below a short video of the Paris event: