Garmin (GRMN) is down about 3% after releasing first-quarter 2026 results (quarter ended March 28, 2026). While the company reported record revenue and operating income, the stock reaction has skewed negative as the report did not include an increase to full-year 2026 guidance and highlighted higher operating expenses.

Garmin reported Q1 2026 consolidated revenue of about $1.75 billion (+14% year over year) and GAAP diluted EPS of $2.09 (pro forma EPS $2.08). Gross margin expanded to 59.4% and operating margin to 24.6%, with operating income of about $432 million (+30% year over year). The company maintained its FY 2026 revenue outlook of $7.9 billion and pro forma EPS guidance of $9.35, which can read as conservative given the strong start to the year. Operating expenses rose 11% year over year, driven by R&D and SG&A personnel costs, which may be contributing to today’s pullback.

Segment results were mixed: Fitness grew sharply (up 42% year over year), while Outdoor declined (down 5%); Aviation and Marine grew 18% and 11%, respectively, and Auto OEM was roughly flat (+1%). Garmin also emphasized cash generation and shareholder returns, reporting roughly $536 million in operating cash flow and $469 million in free cash flow for the quarter, paying about $174 million in dividends and repurchasing about $40 million of shares; it had about $491 million remaining under its $500 million repurchase authorization as of March 28, 2026.

The next catalyst is management’s commentary around cost growth, the durability of margin expansion, and whether the strong Fitness performance can offset softness in Outdoor. With full-year targets reiterated rather than raised, investors will likely look for signals that Garmin can outperform its own FY 2026 assumptions without further expense acceleration.