台灣國際航電 (GRMN) 2022 Q1 法說會逐字稿

Good day, and thank you for standing by. Welcome to Garmin Limited First Quarter 2022 Earnings Conference Call. (Operator Instructions) Please be advised that today's conference is being recorded. (Operator Instructions)

美好的一天，感謝您的支持。歡迎參加 Garmin Limited 2022 年第一季度收益電話會議。 （操作員說明）請注意，今天的會議正在錄製中。 （操作員說明）

I would now like to hand the conference over to your first speaker today to Teri Seck, Director of Investor Relations. Please go ahead.

現在，我想將會議交給您今天的第一位發言人，即投資者關係總監 Teri Seck。請繼續。

Good morning. We would like to welcome you to Garmin Ltd.'s First Quarter 2022 Earnings Call. Please note that the earnings press release and related slides are available at Garmin's Investor Relations site on the Internet at www.garmin.com/stock. An archive of the webcast and related transcript will also be available on our website.

早上好。歡迎您參加 Garmin Ltd. 的 2022 年第一季度財報電話會議。請注意，收益新聞稿和相關幻燈片可在互聯網上的 Garmin 投資者關係網站 www.garmin.com/stock 上找到。我們的網站也將提供網絡廣播和相關成績單的存檔。

This earnings call includes projections and other forward-looking statements regarding Garmin Ltd. and its business. Any statements regarding our future financial position, revenues, earnings, gross margins, operating margins, future dividends or share repurchases, market shares, product introductions, future demand for our products and plans and objectives are forward-looking statements. The forward-looking events and circumstances discussed in this earnings call may not occur, and actual results could differ materially as a result of risk factors affecting Garmin. Information concerning these risk factors is contained in our Form 10-K filed with the Securities and Exchange Commission. In particular, there is significant uncertainty about the duration and impact of the COVID-19 pandemic. This means that results could change at any time, and any statement about the impact of COVID-19 on the company's business results and outlook is the best estimate based on the information available as of today's date.

本次財報電話會議包括有關 Garmin Ltd. 及其業務的預測和其他前瞻性陳述。關於我們未來財務狀況、收入、收益、毛利率、營業利潤率、未來股息或股票回購、市場份額、產品介紹、對我們產品的未來需求以及計劃和目標的任何陳述都是前瞻性陳述。本財報電話會議中討論的前瞻性事件和情況可能不會發生，實際結果可能因影響 Garmin 的風險因素而存在重大差異。有關這些風險因素的信息包含在我們向證券交易委員會提交的 10-K 表格中。特別是，COVID-19 大流行的持續時間和影響存在很大的不確定性。這意味著結果可能隨時發生變化，任何關於 COVID-19 對公司業務結果和前景影響的陳述都是基於截至今天可用信息的最佳估計。

Presenting on behalf of Garmin Ltd. this morning are Cliff Pemble, President and Chief Executive Officer; and Doug Boessen, Chief Financial Officer and Treasurer.

今天上午代表 Garmin Ltd. 出席的是總裁兼首席執行官 Cliff Pemble； Doug Boessen，首席財務官兼財務主管。

At this time, I would like to turn the call over to Cliff Pemble.

此時，我想將電話轉給 Cliff Pemble。

Thank you, Teri, and good morning, everyone. As reported earlier today, consolidated revenue increased 9% to $1.17 billion, representing a new first quarter record. Four business segments reported revenue growth in the quarter, 3 of which delivered double-digit growth.

謝謝你，泰瑞，大家早上好。正如今天早些時候報導的那樣，合併收入增長 9% 至 11.7 億美元，創下第一季度的新紀錄。四個業務部門在本季度報告了收入增長，其中三個實現了兩位數的增長。

We generated $229 million of operating income, down 8% from the prior year. Operating margin was 19.5% and was negatively impacted by gross margin performance, which declined due to historically high freight costs, combined with the strengthening of the U.S. dollar. In addition, operating expenses increased for a variety of reasons, including higher associate head count, increased compensation costs and the increase of certain operational expenses as business activities continue to normalize.

我們創造了 2.29 億美元的營業收入，比上一年下降 8%。營業利潤率為 19.5%，並受到毛利率表現的負面影響，毛利率表現因歷史高位的運費以及美元走強而下降。此外，運營費用增加的原因有多種，包括員工人數增加、薪酬成本增加以及隨著業務活動繼續正常化而增加的某些運營費用。

We performed very well during the quarter despite a combination of old and new headwinds. Supply chain constraints persist, which limited the orders we could fill. Russia's invasion of Ukraine created an unthinkable humanitarian crisis and further complicated the global economic outlook. Despite these challenges, demand for our products remains strong and we are optimistic about the future.

儘管新舊逆風相結合，我們在本季度的表現非常好。供應鏈限制持續存在，這限制了我們可以完成的訂單。俄羅斯入侵烏克蘭造成了難以想像的人道主義危機，並使全球經濟前景更加複雜。儘管存在這些挑戰，對我們產品的需求依然強勁，我們對未來持樂觀態度。

Our Board of Directors recently approved a $300 million share repurchase plan, which is in addition to the proposed $2.92 per share dividend that will be considered by shareholders at the upcoming annual meeting.

我們的董事會最近批准了一項 3 億美元的股票回購計劃，這是在股東即將在即將舉行的年度會議上審議的每股 2.92 美元的擬議股息的補充。

Before turning the call over to Doug, I'll provide highlights by segment and a summary of what we see ahead.

在將電話轉給 Doug 之前，我將按部分提供亮點以及我們對未來的展望。

Starting with business, revenue decreased 28% to $221 million. Gross and operating margins were 48% and 0%, respectively. All product categories declined, but the normalization of demand for cycling products was the main contributor. While revenue from fitness wearables declined, on a combined basis, wearable device revenue across all segments at Garmin experienced robust growth.

從業務開始，收入下降 28% 至 2.21 億美元。毛利率和營業利潤率分別為 48% 和 0%。所有產品類別均出現下降，但自行車產品需求的正常化是主要貢獻者。雖然健身可穿戴設備的收入有所下降，但 Garmin 所有細分市場的可穿戴設備收入均出現強勁增長。

We expected the first half of the year to be challenging for the fitness segment as we compare against the outstanding performance of the prior year. While the decline was greater than expected, we believe these trends will moderate in the back half of the year as we move past the pandemic swings of 2021 and benefit from new product introductions.

與上一年的出色表現相比，我們預計今年上半年健身領域將面臨挑戰。儘管下降幅度大於預期，但我們認為，隨著我們度過 2021 年的大流行波動並受益於新產品的推出，這些趨勢將在下半年放緩。

Moving to the outdoor segment. Revenue increased 50% to $385 million with growth in multiple categories led by strong demand for adventure watches. Gross and operating margins were 64% and 39%, respectively, resulting in operating income of $149 million.

轉移到戶外部分。收入增長 50% 至 3.85 億美元，在冒險手錶的強勁需求帶動下，多個類別實現增長。毛利率和營業利潤率分別為 64% 和 39%，營業收入為 1.49 億美元。

During the quarter, we announced sweeping updates to our adventure watch lineup, including our flagship fenix 7 series featuring a distinctive new design with a touchscreen display, and the Instinct 2 series available in 2 sizes, including versions that can operate indefinitely using our exclusive solar power technology. We also announced the all-new epix with a bright AMOLED touchscreen display and class-leading battery life up to 16 days. We believe that strong demand for these new products as well as other categories in the segment will be a growth driver for the remainder of the year.

在本季度，我們宣布對我們的冒險手錶系列進行全面更新，包括我們的旗艦 fenix 7 系列，採用獨特的新設計和触摸屏顯示屏，以及提供 2 種尺寸的 Instinct 2 系列，包括可以使用我們的獨家太陽能無限期運行的版本電力技術。我們還宣布了全新的 Epix，它具有明亮的 AMOLED 觸摸屏顯示屏和長達 16 天的領先電池壽命。我們認為，對這些新產品以及該領域其他類別的強勁需求將成為今年剩餘時間的增長動力。

Looking next at the aviation segment. Revenue increased 1% to $175 million with growth driven by OEM product categories. Supply constraints impacted sales of aftermarket products but the situation improved throughout the quarter. Gross and operating margins were 73% and 23%, respectively, resulting in operating income of $40 million.

接下來看航空領域。在 OEM 產品類別的推動下，收入增長 1% 至 1.75 億美元。供應限制影響了售後產品的銷售，但整個季度情況有所改善。毛利率和營業利潤率分別為 73% 和 23%，營業收入為 4000 萬美元。

Aircraft OEMs are reporting robust orders from both new and existing customers. Aftermarket demand is also strong as customers invest in new cockpit systems. We believe these are positive indicators of growth for the remainder of the year.

飛機原始設備製造商報告來自新老客戶的強勁訂單。隨著客戶投資新的駕駛艙系統，售後市場的需求也很強勁。我們認為這些都是今年剩餘時間增長的積極指標。

The marine segment delivered another quarter of impressive results with revenue increasing 21% to $254 million. We experienced broad-based growth across multiple product categories led by chartplotters. Gross and operating margins were 51% and 23%, respectively, resulting in operating income of $59 million.

海洋部門又取得了令人印象深刻的四分之一業績，收入增長 21% 至 2.54 億美元。我們在由海圖儀領導的多個產品類別中經歷了廣泛的增長。毛利率和營業利潤率分別為 51% 和 23%，營業收入為 5900 萬美元。

LiveScope has proven to be a halo technology for Garmin, and the new LiveScope Plus sonar system raises the bar with higher resolution images and improved target separation. We continue to see strong demand for our marine products and LiveScope Plus builds on this momentum. We believe this is a positive indicator of growth for the remainder of the year.

LiveScope 已被證明是 Garmin 的一項光環技術，新的 LiveScope Plus 聲納系統通過更高分辨率的圖像和改進的目標分離提高了標準。我們繼續看到對我們的海洋產品的強勁需求，而 LiveScope Plus 正是基於這一勢頭。我們認為這是今年剩餘時間增長的積極指標。

Moving finally to the auto segment. Revenue increased 11% to $138 million, with growth from both OEM and consumer categories. Gross margin was 38%, and we recorded an operating loss of $20 million driven by investments in auto OEM programs.

最後轉向汽車領域。收入增長 11% 至 1.38 億美元，來自 OEM 和消費者類別的增長。毛利率為 38%，由於對汽車 OEM 項目的投資，我們錄得 2000 萬美元的經營虧損。

In consumer auto, we continue to diversify our product offerings with the launch of the Instinct 2 dezl edition smartwatch for truck drivers. In the OEM category, we made significant progress preparing for the launch of the next-generation BMW computing module platform. BMW approved our new Poland factory, giving it a rare green rating for mass production readiness. We anticipate delivering production parts to BMW starting in the second quarter.

在消費類汽車領域，我們通過推出適用於卡車司機的 Instinct 2 dezl 版智能手錶繼續豐富我們的產品供應。在 OEM 領域，我們在準備推出下一代 BMW 計算模塊平台方面取得了重大進展。寶馬批准了我們在波蘭的新工廠，為它的大規模生產準備提供了罕見的綠色評級。我們預計從第二季度開始向寶馬交付生產零件。

Before I turn the call over to Doug, it's important to remember that our diversified business model offers many different paths to achieve our consolidated growth goals. We remain focused on creating highly differentiated products in all segments that excite our customers and lead to success.

在我把電話轉給道格之前，重要的是要記住，我們多元化的商業模式提供了許多不同的途徑來實現我們的綜合增長目標。我們仍然專注於在所有領域創造高度差異化的產品，讓我們的客戶興奮並走向成功。

Regarding our outlook for the rest of the year, I mentioned several new and existing headwinds we face, and we cannot predict the impact that these might have on the business. Also, the first quarter represents the lowest seasonal quarter of our financial year and much of the year remains ahead of us. With these things in mind, we are maintaining our 2022 guidance issued in February, which called for consolidated revenue of $5.5 billion and EPS of $5.90 a share.

關於我們對今年剩餘時間的展望，我提到了我們面臨的幾個新的和現有的逆風，我們無法預測這些可能對業務產生的影響。此外，第一季度是我們財政年度中季節性最低的季度，一年中的大部分時間都在我們前面。考慮到這些因素，我們將維持 2 月份發布的 2022 年指引，該指引要求合併收入為 55 億美元，每股收益為 5.90 美元。

So that concludes my remarks. Next, Doug will walk you through additional details on our financial results. Doug?

我的發言到此結束。接下來，Doug 將向您詳細介紹我們的財務業績。道格？

Thanks, Cliff. Good morning, everyone. I begin by reviewing our first quarter financial results and provide comments on the balance sheet, cash flow statement and taxes.

謝謝，克里夫。大家，早安。我首先回顧我們第一季度的財務業績，並就資產負債表、現金流量表和稅收發表評論。

We posted revenue of $1.173 billion in the first quarter, representing 9% increase year-over-year. Gross margin was 56.5%, 330 basis point decrease from the prior quarter. The decrease was primarily due to higher freight costs and favorable impact of foreign exchange rates.

我們公佈第一季度收入為 11.73 億美元，同比增長 9%。毛利率為 56.5%，比上一季度下降 330 個基點。減少的主要原因是運費上漲和匯率的有利影響。

Operating expense as a percentage of sales was 37%, a 50 basis point increase. Operating income was $229 million, 8% decrease. Operating margin was 19.5%, 300 basis point decrease. Our GAAP EPS was $1.09. The former EPS was $1.11.

營業費用佔銷售額的百分比為 37%，增加了 50 個基點。營業收入為 2.29 億美元，下降 8%。營業利潤率為 19.5%，下降 300 個基點。我們的 GAAP 每股收益為 1.09 美元。前每股收益為 1.11 美元。

Next, we look at our first quarter revenue by segment and geography. In the first quarter, we achieved double-digit growth in 3 of our 5 segments, led by the outdoor segment, robust growth of 50%; followed by the marine segment, 21% growth; and the auto segment, 11% growth. By geography, 21% growth in APAC, 13% growth in Americas was partially offset by 1% decline in EMEA, which was negatively impacted by foreign exchange rates during the quarter.

接下來，我們按細分市場和地理位置查看第一季度的收入。第一季度，我們的 5 個板塊中有 3 個實現了兩位數的增長，其中戶外板塊引領了 50% 的強勁增長；其次是海洋板塊，增長 21%；而汽車領域則增長 11%。按地域劃分，亞太地區 21% 的增長，美洲 13% 的增長部分被歐洲、中東和非洲地區 1% 的下降所抵消，該下降受到本季度外匯匯率的負面影響。

Looking next at operating expenses. First quarter operating expense increased by $42 million or 11%. Research and development increased $20 million year-over-year, primarily due to engineering personnel costs. Advertising expense increased approximately $3 million due to higher spend in the outdoor and marine segments. SG&A increased $19 million compared to the prior year quarter, primarily due to increases in personnel-related expenses, information technology costs.

接下來看看運營費用。第一季度運營費用增加了 4200 萬美元或 11%。研發同比增長 2000 萬美元，主要是由於工程人員成本。由於戶外和海洋領域的支出增加，廣告費用增加了約 300 萬美元。 SG&A 與去年同期相比增加了 1900 萬美元，主要是由於人事相關費用和信息技術成本的增加。

A few highlights on the balance sheet, cash flow statement and taxes. We ended the quarter with cash, marketable securities approximately $3 billion. Accounts receivable decreased sequentially to $600 million following a seasonally strong fourth quarter and grew year-over-year, relatively in line with our sales growth.

資產負債表、現金流量表和稅收方面的一些亮點。我們以現金、有價證券約 30 億美元結束本季度。在經歷了季節性強勁的第四季度之後，應收賬款環比下降至 6 億美元，並且同比增長，與我們的銷售增長相對一致。

Inventory balance increased year-over-year to $1.3 billion. We're executing our strategy, increase days supply to support our increasingly diversified product lines to optimize the mix of ocean versus air freight shipments to carry sufficient levels of raw material safety stock to mitigate increased lead times.

庫存餘額同比增加至 13 億美元。我們正在執行我們的戰略，增加天數供應以支持我們日益多樣化的產品線，以優化海運與空運的組合，以攜帶足夠水平的原材料安全庫存，以減少交貨時間的增加。

In the first quarter of 2022, we generated free cash flow of $126 million, a $206 million decrease in the prior quarter, primarily due to increased working capital needs and higher capital expenditures, also reported effective tax rate of 10.3% compared to 12.2% in the prior quarter. The decrease in effective tax rate is primarily due to an increase in U.S. tax deductions and credits.

在 2022 年第一季度，我們產生了 1.26 億美元的自由現金流，比上一季度減少了 2.06 億美元，主要是由於營運資金需求增加和資本支出增加，同時報告的有效稅率為 10.3%，而上一季度為 12.2%上一季度。有效稅率的下降主要是由於美國稅收減免和抵免的增加。

This concludes our formal remarks. Talon, could you please open the line for Q&A?

我們的正式發言到此結束。 Talon，你能打開問答線嗎？

(Operator Instructions) I show our first question comes from the line of Paul Chung from JPMorgan.

（操作員說明）我表明我們的第一個問題來自摩根大通的 Paul Chung。

First up, you had a very nice head start in outdoor off the strength of fenix and other product releases. Any update to kind of the year and how we think about that? Should we expect kind of more product releases throughout the year? And then can you help us on the kind of seasonal outlook for outdoor? That would also be helpful.

首先，憑藉 fenix 和其他產品發布的優勢，您在戶外有一個非常好的開端。對這一年的任何更新以及我們如何看待這一點？我們是否應該期待全年發布更多產品？然後你能幫助我們了解戶外的季節性前景嗎？這也會有所幫助。

Yes. I think in terms of the update to the year, we basically are still seeing things the way that we've laid them out, and it's very early in the year to really make any conclusions based on the start that we've had. But we do have a strong product lineup right now, and we have more new products coming throughout the year in all of our segments. And so a lot of our momentum and growth is driven around new innovation and new products.

是的。我認為就今年的更新而言，我們基本上仍然按照我們制定的方式看待事物，而且根據我們已經擁有的開端真正做出任何結論還為時過早。但我們現在確實擁有強大的產品陣容，並且全年我們所有細分市場都會推出更多新產品。因此，我們的很多動力和增長都是圍繞新的創新和新產品驅動的。

Got you. And then a similar question on fitness. The pace of decline was a bit more kind of than expected. How do we think about the balance of the year as well? And what drove the minimal operating profit in the quarter? Is that mostly component and cost related? And how does that rebound throughout the year?

得到你。然後是關於健身的類似問題。下降的速度比預期的要快一些。我們如何看待今年的餘額？是什麼推動了本季度的最低營業利潤？這主要與組件和成本有關嗎？全年如何反彈？

Yes. So fitness was weaker than we expected for sure. And the cycling category is the biggest contributor to that. We are comping against really strong results from last year. So there's lots of moving pieces, lots of dimensions to this. But the cycling side of things is really the one that's the biggest impact.

是的。所以健身肯定比我們預期的要弱。自行車類別是其中最大的貢獻者。我們正在與去年的強勁業績相抗衡。所以有很多移動的部分，很多維度。但事情的自行車方面確實是影響最大的方面。

But if you look at it from a different angle, the operating profit was mostly affected by FX and freight costs. If those things would have been under normal circumstances, we would have been pretty much in the range of where our gross margin and operating margin profiles are for the segment.

但換個角度看，營業利潤主要受外彙和運費成本的影響。如果這些事情是在正常情況下發生的，那麼我們的毛利率和營業利潤率就會在該細分市場的範圍內。

Got you. And then lastly, Doug, on free cash flow. Kind of any update on the annual guide? And the share buyback messaging, that's new. We haven't seen buybacks in 4 years -- last 4 years. How should we think about kind of the pace there and potential for more kind of material buybacks given kind of $3 billion net cash?

得到你。最後，Doug，關於自由現金流。年度指南有什麼更新嗎？還有股票回購消息，這是新的。我們已經有 4 年沒有看到回購了——過去 4 年。考慮到 30 億美元的淨現金，我們應該如何考慮那裡的步伐以及更多種類的物質回購的潛力？

Yes. Yes. Regarding free cash flow, yes, still early in the year, but there's a couple of things you need to consider, one of which is our working capital needs. We did have some of those working capital needs here in Q1, where we saw inventory increased more than the previous year. You also need to factor in last year, we had a large amount of inventory increases in the back of the year. So hopefully, we won't have as much of an increase in the inventory, I'll say, year-over-year than we did last year in there. But the working free cash flow and other things, CapEx is pretty consistent year-over-year for the full year in there. It depends also on the operating side of things, but we'll give you more guidance on that in Q2.

是的。是的。關於自由現金流，是的，仍然在今年年初，但是您需要考慮幾件事，其中之一是我們的營運資金需求。我們在第一季度確實有一些營運資金需求，我們看到庫存比去年增加了更多。您還需要考慮到去年，我們在年末有大量庫存增加。因此，希望我們的庫存不會比去年同期增加那麼多。但是工作自由現金流和其他方面，資本支出在全年的同比情況相當一致。這也取決於事物的運營方面，但我們將在第二季度為您提供更多指導。

As it relates to the share buyback, it's something that we evaluate with the Board, and we felt that was something that was appropriate at this point in time. Regarding the amount that we're going to be doing, it's really depending upon market conditions, business conditions at a point in time, the amount that we buy back during the period.

由於它與股票回購有關，這是我們與董事會一起評估的事情，我們認為這在此時是合適的。關於我們將要做的金額，這實際上取決於市場條件，某個時間點的業務狀況，我們在此期間回購的金額。

I show our next question comes from the line of Will Power from Baird.

我展示了我們的下一個問題來自 Baird 的 Will Power。

Great. Maybe just a follow-up first on fitness. I think we, and you all noted, there were some particularly tough cycling comps year-over-year, but it sounds like there was some year-over-year weakness in the other fitness categories, too. I guess I'm wondering if there are any areas you'd call out there. Any key drivers of that? Maybe any comments on changes in the competitive climate? Just trying to understand the broader fitness picture.

偉大的。也許只是健身的後續行動。我想我們，你們都注意到，每年都有一些特別艱難的自行車比賽，但聽起來其他健身類別也有一些同比弱點。我想我想知道是否有任何地方你會在那裡打電話。有什麼關鍵驅動因素嗎？也許對競爭環境的變化有何評論？只是想了解更廣泛的健身情況。

Yes. I think that as we mentioned, all categories in this segment were weaker year-over-year. We're comparing against a really monster quarter from the last year. So that's one dimension. And then you can't discount the impact of our overall wearable product lineup across the company and particularly the release of the new adventure wearables on the outdoor side, which probably impacted things as well.

是的。我認為正如我們所提到的，該細分市場的所有類別都同比下降。我們正在與去年的一個非常糟糕的季度進行比較。所以這是一個維度。然後你不能低估我們整個公司的整體可穿戴產品陣容的影響，特別是在戶外方面發布新的冒險可穿戴設備，這可能也影響了事情。

So as I mentioned, we experienced robust growth across all wearables at Garmin. So we feel like the market is robust and our position in the market is also very robust.

正如我所提到的，我們在 Garmin 的所有可穿戴設備上都經歷了強勁的增長。所以我們覺得市場很強勁，我們在市場上的地位也很穩健。

Okay. That makes sense. Cliff, it'd be great to get a little more color as to what you're seeing kind of real-time across Europe. As you talk to your retail partners, have you seen any change in kind of purchasing trends, appetite from them just as you think about the impacts of the Russia-Ukraine conflict and inflationary pressures kind of across the continent, particularly in Eastern Europe? As you exit Q1 and obviously now into Q2, anything you'd call out there with respect to demand trends?

好的。這就說得通了。 Cliff，如果你能在整個歐洲實時看到你所看到的內容，那就太好了。當您與您的零售合作夥伴交談時，您是否看到他們的購買趨勢和興趣發生了任何變化，就像您考慮俄羅斯-烏克蘭衝突的影響以及整個非洲大陸，特別是東歐的通貨膨脹壓力一樣？當您退出第一季度並顯然現在進入第二季度時，您對需求趨勢有何看法？

Yes. I think Europe is more notably weak as you can see in our geographical results. I think really 2 aspects to that. One is the Ukraine situation. We definitely did see a noticeable impact in product registrations as that conflict broke out and was weaker for the initial period and has only recently started to show some signs of kind of popping back as people maybe normalize or get used to the risk environment that they're in there.

是的。正如您在我們的地理結果中所看到的那樣，我認為歐洲更加疲軟。我認為確實有兩個方面。一是烏克蘭局勢。我們確實確實看到了產品註冊的顯著影響，因為衝突爆發並且在最初階段較弱，並且直到最近才開始顯示出一些反彈的跡象，因為人們可能會正常化或習慣他們的風險環境'重新在那裡。

But the other factor for Europeans is the high inflation. It's really not just European, but it's global, but they particularly are impacted by much higher fuel prices and concern and worry over the economy. So I think those factors impacted us in Europe, but we saw a much stronger growth in Americas and APAC.

但對歐洲人來說，另一個因素是高通脹。這不僅是歐洲的，而且是全球的，但他們尤其受到燃料價格高得多以及對經濟的擔憂和擔憂的影響。所以我認為這些因素在歐洲影響了我們，但我們在美洲和亞太地區看到了更強勁的增長。

Yes. Okay. I guess maybe just a last question. You maintained guidance for the year. Maybe just any other color as to your confidence there. I mean it sounds like it's really built just on the diversity of the business, and I recognize we're still early in the year. But as you think about the various uncertainties that are still out there, whether it's supply chain, inflation, et cetera, maybe just any other color as to what gives you confidence in maintaining that outlook at this point?

是的。好的。我想也許只是最後一個問題。你維持了當年的指導。也許只是你在那裡的信心的任何其他顏色。我的意思是，這聽起來真的是建立在業務的多樣性之上，我承認我們還處於年初。但是，當您考慮仍然存在的各種不確定性時，無論是供應鏈、通貨膨脹等，也許只是任何其他顏色，您有信心在這一點上保持這種前景嗎？

Yes. As you said, we're maintaining what we said in February. It is early in the year, and this is our lowest seasonal quarter. So we like to see how the year is evolving before we make any material changes to our outlook.

是的。正如你所說，我們將維持我們在 2 月份所說的話。現在是年初，這是我們季節性最低的季度。因此，我們希望在對我們的前景做出任何重大改變之前先看看這一年的發展情況。

I would say that in general, we see positive indicators, as I said in my remarks, across many of our segments. And at the same time, the uncertainties have increased and the complexities have increased, so we recognize that as well. But the diversity of our business is very high. The demand in several of our segments is strong. And so that's what we base our confidence on as we go forward.

我想說，總的來說，正如我在講話中所說，我們在許多領域都看到了積極的指標。同時，不確定性增加了，複雜性增加了，所以我們也認識到這一點。但我們業務的多樣性非常高。我們幾個細分市場的需求強勁。這就是我們前進的信心的基礎。

Our next question comes from the line of Nik Todorov from Longbow.

我們的下一個問題來自 Longbow 的 Nik Todorov。

Doug and Cliff, first question on gross margin for fitness. How should we think about the trajectory throughout the year? Obviously, I think FX headwind, if anything, is probably going to increase in 2Q sequentially and the logistics piece is probably not changing much. So any kind of color on trajectory of fitness gross margin through the rest of the year?

Doug 和 Cliff，關於健身毛利率的第一個問題。我們應該如何看待全年的軌跡？顯然，我認為外匯逆風（如果有的話）可能會在第二季度連續增加，而物流部分可能不會發生太大變化。那麼今年剩餘時間健身毛利率的軌蹟有什麼顏色嗎？

Yes. As it relates to gross margin for fitness, yes, 2 of the big drivers there, obviously, are freight and FX. And actually, FX is a bigger impact on the fitness business just given our EMEA side of the business in there.

是的。由於它與健身毛利率有關，是的，其中兩個主要驅動因素顯然是貨運和外匯。實際上，考慮到我們在歐洲、中東和非洲地區的業務，FX 對健身業務的影響更大。

So as it relates to the year, it's still early in the year here, but we have to manage through those headwinds, and we'll have to see how those mitigate hopefully. We're doing things, hopefully, help mitigate some of the freight. I previously mentioned inventory. We're trying to optimize our ocean versus air to mitigate some of the increases there. But FX, that's something -- and we've seen more of the strengthening of dollar there and increases. So we have to see how that all plays out for the rest of the year.

因此，與今年有關，現在還處於年初，但我們必須克服這些不利因素，我們必須看看這些不利因素如何緩解。我們正在做的事情，希望能幫助減輕一些運費。我之前提到了庫存。我們正在努力優化我們的海洋與空氣，以減輕那裡的一些增長。但是外匯，就是這樣——我們已經看到更多的美元走強和上漲。所以我們必須看看這一切在今年剩下的時間裡會如何發展。

Okay. And then, Cliff, I think you mentioned in your remarks that you're starting to see some improvement in aviation in the aftermarket business as it relates to component supply. Do you have any visibility into further easing into the rest of the year? And do you expect maybe a return to some normal environment to the second half? Or that's too early to call?

好的。然後，克利夫，我想你在評論中提到，你開始看到售後市場的航空業在零部件供應方面有所改善。您對今年剩餘時間的進一步寬鬆有任何了解嗎？您是否預計下半年可能會恢復正常環境？或者現在打電話還為時過早？

Yes. I think one of the things we mentioned actually last time is we expected the first half of the year to be more challenging for the aviation aftermarket because of the supply chain constraints we were experiencing. We've started to see that improve, especially as we rolled into the month of March and onward. But we do expect still to be able to see more improvement as we get into the back half because we're taking actions to dual source some parts as well as we're getting more supply from our existing suppliers.

是的。我認為我們上次實際上提到的一件事是，由於我們遇到的供應鏈限制，我們預計今年上半年航空售後市場將更具挑戰性。我們已經開始看到這種改善，尤其是當我們進入 3 月份及以後。但我們確實希望在進入後半部分時仍能看到更多改進，因為我們正在採取行動對一些零件進行雙重採購，並且我們從現有供應商那裡獲得更多供應。

Okay. And last question for me. There's been some signs of moderation of retail boating demand, and I know you're exposed more on the aftermarket side. But I'm just wondering, are you seeing any spillover effect, any signs of moderation on the aftermarket side of marine?

好的。最後一個問題。有一些零售船需求放緩的跡象，我知道您在售後市場方面的風險更大。但我只是想知道，您是否看到任何溢出效應，船舶售後市場方面的任何緩和跡象？

Yes. I think really nothing to speak of. We still see very strong demand for our most popular products and especially driven by the technology developments that we've made in the area of live sonar, and our display systems are all very good and sought after.

是的。我覺得真的沒什麼好說的。我們仍然看到對我們最受歡迎的產品的強勁需求，尤其是在我們在現場聲納領域取得的技術發展的推動下，我們的顯示系統都非常好並且受到追捧。

I would say in terms of retail boating or I would say the OEM side is what we would call that, but in general, we still hear our OEM partners say that they're sitting on years of backlogs in their business and working very hard to deliver the boats that have been ordered. So we still see a strong demand cycle moving forward from the OEM side of the business.

我想說的是零售船，或者我會說 OEM 方面就是我們所說的，但總的來說，我們仍然聽到我們的 OEM 合作夥伴說他們的業務積壓了多年，並且非常努力地工作交付已訂購的船隻。因此，我們仍然看到來自 OEM 業務的強勁需求週期向前發展。

I show our next question comes from the line of Jeffrey Rand from Deutsche Bank.

我展示了我們的下一個問題來自德意志銀行的杰弗里蘭德。

How are the current inventory levels of your channel for your cycling business? And how do you think about end customer demand for cycling products through the rest of the year?

您的自行車業務目前的渠道庫存水平如何？您如何看待今年剩餘時間內最終客戶對自行車產品的需求？

I think in terms of inventory, it varies by product line, but the one that we've been talking about most is the indoor trainer inventory. Retailers do have a lot of inventory in the indoor training category, and they're selling through that, of course. And we also have inventory that we have in our warehouses that would go into the channel as soon as it kind of clears up. But that's a situation that's going to be around for a while. We don't expect it to improve quickly. So we're just going to have to be patient and work through that.

我認為在庫存方面，它因產品線而異，但我們一直在談論最多的是室內訓練器庫存。零售商在室內訓練類別中確實有很多庫存，當然，他們正在通過這些庫存進行銷售。而且我們的倉庫中還有庫存，一旦清理完畢就會進入渠道。但這種情況會持續一段時間。我們預計它不會很快改善。所以我們只需要耐心等待並解決這個問題。

In terms of other categories, it really depends by geography, by retailer, by product line. But in general, we think channel inventory levels are reasonable, and we don't see any concern there.

就其他類別而言，它確實取決於地理位置、零售商和產品線。但總的來說，我們認為渠道庫存水平是合理的，我們沒有看到任何擔憂。

Great. And then operating margins in your auto OEM business were relatively flat sequentially. How do you think about operating margins for this business over the next few quarters as projects ramp up further?

偉大的。然後，您的汽車 OEM 業務的營業利潤率環比持平。隨著項目的進一步增加，您如何看待該業務在未來幾個季度的營業利潤率？

Yes. I think in terms of what will happen going forward, as our deliveries increase, we will be able to experience scale in that business. So it should improve our overall operating margin performance, although we're not expecting that to swing to a positive number in the near term. But as we start to deliver the new products to BMW and as our production scale increases, it should generally improve.

是的。我認為就未來會發生什麼而言，隨著我們交付量的增加，我們將能夠在該業務中體驗規模。因此，它應該會改善我們的整體營業利潤率表現，儘管我們預計短期內不會轉為正數。但隨著我們開始向寶馬交付新產品，隨著我們生產規模的擴大，總體上應該會有所改善。

I show our next question comes from the line of Ben Bollin from Cleveland Research.

我展示了我們的下一個問題來自 Cleveland Research 的 Ben Bollin。

A couple of questions. The first is, Cliff, could you talk a little bit about how you think of fitness and outdoor wearables? And how much of that business do you think is completely new buyers versus how much might be refresh of preexisting buyers? And then I had a follow-up.

幾個問題。首先是，Cliff，你能談談你對健身和戶外可穿戴設備的看法嗎？您認為該業務中有多少是全新的買家，而有多少可能是現有買家的更新？然後我進行了跟進。

Yes, thanks. I think in terms of the customer profile of our wearables, it really depends by product line and by segment. But at the highest level, if you look across all our wearables, we are mostly selling to brand-new customers to Garmin who are registering a new device for the first time and creating a Garmin Connect account. But we also have, of course, a sizable amount of business that we do with people who love to stay current on the latest products that we release. And so we see that side of the business as well. But right now, it's still more of an -- it's still a majority of people that are new to our wearables.

是啊謝謝。我認為就我們可穿戴設備的客戶概況而言，它確實取決於產品線和細分市場。但在最高級別，如果您查看我們所有的可穿戴設備，我們主要向 Garmin 的全新客戶銷售產品，這些客戶是首次註冊新設備並創建 Garmin Connect 帳戶。但當然，我們也有大量的業務，我們與那些喜歡了解我們發布的最新產品的人合作。所以我們也看到了業務的那一面。但現在，它仍然更多——仍然是大多數人對我們的可穿戴設備不熟悉。

Okay. The other different question, can you remind us on the revenue recognition methodology with BMW. How it may change as you go into the broader platform outside of China? And any thoughts on content opportunity?

好的。另一個不同的問題，你能提醒我們寶馬的收入確認方法嗎？當您進入中國以外的更廣泛平台時，它會如何變化？對內容機會有什麼想法嗎？

Yes. So as revenue recognition standpoint, probably shouldn't be that much different than we have at this point in time in the different models that come out from that standpoint -- from a revenue recognition standpoint.

是的。因此，從收入確認的角度來看，從收入確認的角度來看，從這個角度得出的不同模型可能與我們目前所擁有的差別不大。

Any thoughts on content going forward? As you get into more of these models, does that change the amount of dollar content per vehicle? Or is it similar with what you saw in China?

對未來的內容有什麼想法嗎？隨著您使用更多這些模型，這是否會改變每輛車的美元內容量？還是和你在中國看到的一樣？

I think actually, Ben, the content per vehicle on the newer platforms that we're delivering is much higher per vehicle than what we're seeing on the current products delivered out of China as well as out of the U.S. factory here. In some cases, once we get to full production mode with BMW, they've adopted it across all of their platforms. Some vehicles could have 3 or more of these modules within the vehicle. So it will dramatically increase per vehicle based on what we're delivering over the long term to BMW.

Ben，我認為實際上，我們交付的新平台上每輛車的內容比我們在中國和美國工廠交付的當前產品上看到的每輛車的內容要高得多。在某些情況下，一旦我們與寶馬一起進入全面生產模式，他們就會在所有平台上採用這種模式。一些車輛可能在車輛內具有 3 個或更多這些模塊。因此，根據我們長期向寶馬提供的產品，每輛車的價格將大幅增加。

I show our next question comes from the line of Elizabeth Grenfell from Bank of America.

我展示了我們的下一個問題來自美國銀行的 Elizabeth Grenfell。

As we think about the cycling business and the normalization that we're seeing, when do you expect it to completely have normalized? And at what level do you consider normal?

當我們考慮自行車業務和我們所看到的正常化時，您預計它何時會完全正常化？你認為在什麼水平上是正常的？

Yes, I think that's a very good question. During the first half of 2021, we saw elevated demands for all cycling products, including the indoor trainers where every factory -- and speaking broadly beyond just Garmin every factory and every manufacturer of those devices were delivering all that they could make to the market because of the demand. So the first half was very robust because of that really strong pandemic-driven demand and then that tailed off significantly in the second half. So we are expecting to see that those comps will improve starting in the second half and will probably take throughout the remainder of the year to really normalize.

是的，我認為這是一個非常好的問題。在 2021 年上半年，我們看到對所有自行車產品的需求都在增加，包括每家工廠的室內訓練器——廣泛地說，不僅僅是 Garmin，每家工廠和這些設備的每家製造商都在向市場提供他們可以生產的所有產品，因為的需求。因此，由於大流行驅動的需求非常強勁，上半年非常強勁，然後在下半年顯著下降。因此，我們預計這些組合將從下半年開始有所改善，並且可能需要在今年餘下的時間裡才能真正正常化。

In terms of the levels we're seeing, generally, we continue to see that the levels we're settling at for cycling products are in line with reasonable growth of the overall market over the past 2 to 3 years. So what that means is the CAGR is probably somewhere in the 5% to 10% range of the overall market, and it's settling in at some reasonable growth level over 2019 or even early 2020 type numbers.

就我們所看到的水平而言，總的來說，我們繼續看到我們為自行車產品設定的水平與過去 2 到 3 年整體市場的合理增長相一致。所以這意味著複合年增長率可能在整個市場的 5% 到 10% 範圍內，並且在 2019 年甚至 2020 年初的型號數量上穩定在某個合理的增長水平。

(Operator Instructions) I show our next question comes from the line of Erik Woodring from Morgan Stanley.

（操作員說明）我展示了我們的下一個問題來自摩根士丹利的 Erik Woodring。

Maybe just a few for me. Starting with one clarification question, Cliff. And Cliff, you mentioned earlier about channel inventory levels being reasonable. Was that just a fitness comment? Or was that a total company comment?

也許對我來說只有幾個。從一個澄清問題開始，克里夫。還有 Cliff，您之前提到過渠道庫存水平是合理的。這只是一個健身評論嗎？或者那是公司的全部評論？

I would say total across all of our product lines that are popular in retail.

我想說的是我們所有在零售業流行的產品線的總和。

Okay. And then in your -- in the prepared remarks, in the presentation deck, you made similar comments in outdoor, aviation, marine, calling out positive indicators. Any way that you can just maybe, for each of those markets, elaborate just a bit on what those positive indicators are?

好的。然後在你準備好的評論中，在演示文稿中，你在戶外、航空、海洋方面發表了類似的評論，並提出了積極的指標。對於這些市場中的每一個，您是否可以通過任何方式詳細說明這些積極指標是什麼？

Well, I think if we just look at those one by one, I would say, in outdoor, our new product releases and the adventure watches are -- we continue to work to fill all of the demand that we're seeing for those. And in addition, there's some golf products that we've struggled to match the demand popularity of some of the products that we have there. So that's the outdoor side of things.

好吧，我認為如果我們只看這些，我會說，在戶外，我們的新產品發布和冒險手錶是——我們繼續努力滿足我們對這些產品的所有需求。此外，我們一直在努力滿足一些高爾夫產品的需求，以滿足我們在那裡擁有的一些產品的需求。這就是事情的戶外方面。

On the marine side of things, our new Panoptix LiveScope Plus system is extremely popular. And so we're working to fulfill a lot of back orders on that product, which also drives display systems. So there's kind of a broad-based demand in our marine segment because of that.

在海洋方面，我們新的 Panoptix LiveScope Plus 系統非常受歡迎。因此，我們正在努力完成該產品的大量延期交貨，這也推動了顯示系統。因此，正因為如此，我們的海洋領域存在廣泛的需求。

And then finally, in aviation, I think our biggest opportunity right now is the aftermarket side of things. We've been constrained because of the supply chain situation. And as I mentioned, we're starting to see that get better incrementally, but it will take some time to really fully recover. But the backlogs that we have there of things that we need to deliver is strong.

最後，在航空領域，我認為我們現在最大的機會是售後市場。由於供應鏈情況，我們受到了限制。正如我所提到的，我們開始看到這種情況逐漸好轉，但要真正完全恢復還需要一些時間。但是，我們需要交付的東西的積壓非常多。

Okay. Super helpful. And then one last question for me on outdoor. How much of the outperformance, so to speak, in 1Q was a result of sales being pushed from 4Q into 1Q? And then kind of second to that, were you able to fill the channel with all of your -- with all of the new products that you were -- that you launched in outdoor? Or is there still more to come, you'd say?

好的。超級有幫助。最後一個關於戶外的問題。可以說，第一季度的出色表現有多少是由於銷售從第四季度推到了第一季度？其次，您是否能夠用您在戶外推出的所有新產品填充渠道？或者還有更多的東西，你會說？

I think most certainly, we tried to time the launch of the new products optimally, and we felt like it was not the best time to launch in late Q4. So there's probably some impact that shifted demand because people were waiting for our new products for sure. But it's hard to speculate on how much of that there was.

我認為最肯定的是，我們試圖優化新產品的發佈時間，我們覺得這不是在第四季度末發布的最佳時間。所以可能會有一些影響改變了需求，因為人們肯定在等待我們的新產品。但很難推測其中有多少。

And would you say your second part again?

你會再說一遍你的第二部分嗎？

Yes. Just curious if you were able to get enough supply to fill the channel to your ideal levels for those new products launch in outdoor, if there is still more of that to come in the future, you'd say?

是的。只是好奇您是否能夠獲得足夠的供應以將渠道填充到您在戶外推出的新產品的理想水平，如果將來還有更多供應，您會說？

I think for our initial plan, we definitely were able to fill the channel. And what we found is that the reorders have continued to be strong. And so we're still chasing initial demand for that product line that we're working to fill.

我認為對於我們最初的計劃，我們絕對能夠填補這個頻道。我們發現，重新訂購持續強勁。因此，我們仍在追逐我們正在努力填補的產品線的初始需求。

I'm showing no further questions in the queue. At this time, I would like to turn the call back over to Teri Seck, Director of Investor Relations, for closing remarks.

我沒有在隊列中顯示更多問題。在這個時候，我想把電話轉給投資者關係總監 Teri Seck 來做閉幕詞。

Okay, everyone. Thanks so much for your time. Doug and I are available for callbacks and have a great day.

好的，大家。非常感謝您的寶貴時間。道格和我可以接聽電話，祝您度過愉快的一天。

This concludes today's conference call. Thank you for participating. You may now disconnect.

今天的電話會議到此結束。感謝您的參與。您現在可以斷開連接。