In the second quarter of 2022, Garmin made $1.24 billion in sales. As a result, sales decreased by 6% in the first three months of this year. The gross margin is 58.7%, and the operating margin is 23.6% of total revenue. In the second quarter of 2022, operating income is expected to be $293 million.
"The second quarter earnings decline was primarily due to the lack of success of our fitness segment," said Cliff Pemble, Garmin President, and CEO. "Markets are beginning to normalize after two years of pandemic-driven growth. As a result of these external factors, we are also dealing with high inflation and rising interest rates. Though our sales forecast may need to be adjusted due to the shifting economic climate, we are confident that the innovative product portfolio and the diversification strategy we have in place will help us succeed.
According to Garmin's second-quarter sales, the fitness segment saw a 34% decrease from last year. Wearable and bicycle products are particularly vulnerable to this trend. The company's gross profit margin is 49 percent, and its operating profit margin is 9 percent, resulting in a net profit of $23 million. A new generation of Garmin Forerunner running watches will be available in the second quarter of 2022. In smartwatch mode, the Forerunner 955 Solar has a battery life of up to 20 days and a touchscreen that is easy to use and respond to. There are new features in the Forerunner 255, including support for triathlons and recovery recommendations. The Garmin Edge 1040 series of high-performance bike computers are also on display at the Garmin booth.
The company's outdoor sales increased by 18% compared to the same period last year, mainly due to increased demand for multisport watches. The gross profit margin is 66%, and the operating profit margin is 40%. Approximately $154 million in operating income is generated annually. The Garmin Tactix 7 series was launched by Garmin in the second quarter, a complete GPS smartwatch with tactical functions and extensive navigation system features.
Second quarter revenue in the marine segment was down 7% from last year. Due to supply chain constraints, not all products can meet demand. The gross margin is 57%, and the operating margin is 28%. In the second quarter, Garmin released its new ECHOMAP UHD2 series with built-in WiFi. New marine functions and a simple touchscreen operation were also displayed in Garmin's new Quatix 7.
In the second quarter, sales of automobiles fell by 6%. Profit margins of 40% are expected. For professional drivers, Garmin introduced the new dzl headsets during the quarter, which feature up to 50 hours of uninterrupted Bluetooth talk time and active noise cancellation to ensure sound even while driving.
The aerospace sector's revenue increased by 13% in the second quarter, owing to growth in both the original equipment manufacturer and the aftermarket. In the second quarter, the gross margin was 72 percent, and the operating margin was 30 percent, resulting in a net income of $62.
The Garmin company is revising its annual forecast for 2022 in light of the first half of the year's performance. The company expects to make around $5 billion in sales this year.
