8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

Current Report Pursuant to Section 13 or 15(d) of

the Securities Act of 1934

Date of Report (Date of earliest event reported): August 1, 2007

GARMIN LTD.

(Exact name of registrant as specified in its charter)

Cayman Islands	0-31983	98-0229227
(State or other	(Commission	(I.R.S. Employer
jurisdiction	File Number)	Identification No.)
of incorporation)

P.O. Box 30464SMB

5^th Floor, Harbour Place

103 South Church Street

George Town, Grand Cayman, Cayman Islands

(Address of principal executive offices)

Registrant’s telephone number, including area code: (345) 946-5203

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

oWritten communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

oSoliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

oPre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

oPre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02. Results of Operations and Financial Condition

On August 1, 2007, Garmin Ltd. issued a press release announcing its financial results for the fiscal second quarter ended June 30, 2007. A copy of the press release is attached as Exhibit 99.1.

The information in this Item 2.02, and Exhibit 99.1 to this Current Report on Form 8-K, shall not be deemed “filed” for the purposes of or otherwise subject to the liabilities under Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Unless expressly incorporated into a filing of Garmin Ltd. under the Securities Act of 1933, as amended, or the Exchange Act made after the date hereof, the information contained in this Item 2.02 and Exhibit 99.1 hereto shall not be incorporated by reference into any filing of the registrant, whether made before or after the date hereof, regardless of any general incorporation language in such filing.

Item 9.01. Financial Statements and Exhibits

(a) Not applicable.

(b) Not applicable.

(c) Not applicable.

(d) Exhibits. The following exhibit is furnished herewith.

Exhibit No.	Description
99.1	Press Release dated August 1, 2007 (furnished pursuant to Item 2.02).

2

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	GARMIN LTD.
Date: August 1, 2007		/s/ Andrew R. Etkind
		Andrew R. Etkind
		General Counsel and Secretary

3

EXHIBIT INDEX

Exhibit No.	Description
99.1	Press Release dated August 1, 2007

4

EX-99.1

EXHIBIT 99.1

Garmin Reports Record Second Quarter; Announces Increased Dividend, Raises Guidance

Cayman Islands/August 1, 2007/PR Newswire

Garmin Ltd. (Nasdaq: GRMN - news) today announced a record quarter ended June 30, 2007.

Second Quarter 2007 Financial highlights:

· Total revenue of $742 million, up 72% from $433 million in second quarter 2006

· Automotive/Mobile segment revenue increased 99% to $508 million in second quarter 2007

· Aviation segment revenue increased 39% to $78 million in second quarter 2007

· Outdoor/Fitness segment revenue increased 9% to $77 million in second quarter 2007

· Marine segment revenue increased 59% to $80 million in second quarter 2007

· All geographic areas experienced significant growth:

· North America revenue was $455 million compared to $233 million, up 95%

· Europe revenue was $257 million compared to $178 million, up 44%

· Asia revenue was $31 million compared to $22 million, up 41%

· Mix of revenue by region reflected the strong growth of the Automotive/Mobile segment in North American with a higher percentage of North American revenue relative to the year-ago quarter. Revenue from our automotive/mobile segment continued to become a larger portion of total company revenues when compared with the same quarter in 2006, at 68% of total revenues.

· Diluted earnings per share increased 75% to $0.98 from $0.56 in second quarter 2006; excluding foreign exchange, EPS increased 82% to $1.00 from $0.55 in the same quarter in 2006.

Year-to-Date 2007 Financial highlights:

· Total revenue of $1.23 billion, up 64% from $755 million year-to-date 2006

· Automotive/Mobile segment revenue increased 103% to $825 million in year-to-date 2007

· Aviation segment revenue increased 32% to $150 million in year-to-date 2007

· Outdoor/Fitness segment revenue increased 2% to $138 million in year-to-date 2007

· Marine segment revenue increased 22% to $123 million in year-to-date 2007

· All geographic areas experienced significant growth:

· North America revenue was $777 million compared to $435 million, up 79%

· Europe revenue was $405 million compared to $280 million, up 45%

· Asia revenue was $53 million compared to $40 million, up 33%

· Diluted earnings per share increased 69% to $1.62 from $0.96 in year-to-date 2006; excluding foreign exchange, EPS increased 62% to $1.59 from $0.98 in the same quarter in 2006.

Business highlights:

· Strong sales in our automotive/mobile, aviation, and marine segments put them on track to meet or exceed earlier full year guidance for these segments.

· 2.54 million units sold in the second quarter of 2007, up 99% from the same quarter in 2006; year-to-date units sold increased 85% from the same period in 2006.

· Completed the build-out of our second Taiwan manufacturing facility, increasing the number of production lines from 21 to 31, and production capacity at the end of the second quarter to approximately 12 million units annually.

· Purchased and began build-out of our third Taiwan facility in Linkou. Because of the significant increase in demand for PNDs, new production lines are being installed now, with initial production runs scheduled to begin in August. Expansion of our R&D and other office space in Taiwan is also in progress.

· We have begun work to expand our North American warehouse in Olathe, Kansas with expected completion of Q1 2008.

· Targeted advertising and promotional programs for the spring season drove solid second quarter sales. We continue to work to increase our retail penetration and broaden our distribution as retailers lay the groundwork for the upcoming holiday selling season.

· Completed the acquisition of our German distributor on July 2nd, and announced our intent to acquire our distributor in Spain. These activities are part of our ongoing efforts to improve our market share in Europe.

Executive overview from Dr. Min Kao, Chairman and Chief Executive Officer:

“Garmin experienced a very exciting second quarter. Our strong growth in the automotive/mobile segment demonstrated that our products continue to be well-positioned to take advantage of the growing demand for portable navigation devices. We are pleased that, according to independent market research, we have maintained a strong leadership position in North America with approximately fifty percent PND market share. The nüvi^TM 200W and 250W products delivered during the second quarter will provide an attractive option for cost-conscious consumers who prefer a wide-screen display. Our popular nüvi^TM and c-series product offerings support our strategy of extensive market segmentation, drawing in customers with compelling, competitive features, and useful content integrated into easy-to-use products at many attractive price points. We believe this approach should drive strong results in the holiday season and push revenue growth beyond our earlier expectations.

Our aviation segment continued to grow faster than expected during the quarter, as positive response to our WAAS and GMX200 product offerings and growth in the sale of our G1000 cockpit continued. We are pleased to report we have begun shipment of our G1000 cockpit to Piper Aircraft, Inc. for their Piper Saratoga II TC and Piper 6X aircraft. We believe our aviation segment will exceed our earlier revenue growth expectations.

Response to our revolutionary new marine products and cartography has been very positive. Sell-through and backlogs for our new products including our 4000- and 5000-series have been strong. We believe the marine segment is positioned to meet our 2007 guidance for this segment.

Revenue in our outdoor/fitness segment increased when compared to the year ago quarter. We look forward to increased sales generated by the newly released Astro dog tracking product, as well as new eTrex and Rino products which provide high-sensitivity GPS performance. We still see good growth opportunities for this segment, however we believe revenue growth for this segment will be lower than earlier anticipated due to the timing of our new product introductions.”

Financial overview from Kevin Rauckman, Chief Financial Officer:

“Clearly we are pleased with our financial results for the second quarter, and look forward to a strong second half of 2007,” said Kevin Rauckman, chief financial officer of Garmin Ltd. “Our revenue and earnings per share during the quarter grew 72% and 75% respectively, exceeding our expectations. Excluding the impact of foreign exchange, EPS for the quarter grew 82%, from $0.55 to $1.00.

Gross margin for the overall business remained strong in the second quarter, rising 50 basis points from the year-ago quarter. The automotive/mobile segment gross margin improved during the quarter as PND pricing declined more slowly than we expected. Gross margin for the other three segments declined slightly when compared with the year-ago quarter. However, marine margin improved substantially relative to the previous two quarters as new product releases pushed up gross margin. Our outdoor/fitness gross margin also improved sequentially as we began shipping new products toward the end of the quarter.

Operating margin improved 140 basis points from the year-ago quarter. This improvement was primarily driven by strength in gross margin combined with operating leverage as revenues outpaced the increase in expenses during the quarter. Sequentially, operating margin expanded within all four of our business segments as we continued to roll out new products. While we are pleased with the margin improvements, they reflect a less aggressive PND pricing environment than we had anticipated combined with favorable cost reductions during the quarter. However, we anticipate a more significant price compression during the second half of 2007.

We also generated $154 million of free cash flow in the second quarter of 2007, resulting in a cash and marketable securities balance of nearly $1.1 billion at the end of the quarter.”

Fiscal 2007 Outlook

We remain optimistic about the future success of our business and our ability to serve customers and distributors around the world. With this in mind, we are updating our guidance as follows:

· We anticipate overall revenue to exceed $2.8 billion in 2007, and earnings per share to exceed $3.15.

· We anticipate segment revenue growth rates for our automotive/mobile, aviation, marine, and outdoor/fitness segments to be 80%, 30%, 20%, and 10%, respectively

· We anticipate operating margins to be approximately 27% for the full year 2007

· Our effective tax rate should remain approximately 13%

Increased Dividend

The Garmin Board of Directors has approved an annual cash dividend of $0.75 per share, an increase of $0.25 per share. The dividend is payable to shareholders of record on August 15, 2007, and will be paid on September 14, 2007.

Non-GAAP Measures

Net income (earnings) per share, excluding foreign currency

Management believes that net income per share before the impact of foreign currency translation gain or loss is an important measure. The majority of the company’s consolidated foreign currency translation gain or loss results from translation into New Taiwan dollars at the end of each reporting period of the significant cash and marketable securities, receivables and payables held in U.S. dollars by the company’s Taiwan subsidiary. Such translation is required under GAAP because the functional currency of this subsidiary is New Taiwan dollars. However, there is minimal cash impact from such foreign currency translation and management expects that the Taiwan subsidiary will continue to hold the majority of its cash, cash equivalents and marketable securities in U.S. dollars. Accordingly, earnings per share before the impact of foreign currency translation gain or loss allows an assessment of the company’s operating performance before the non-cash impact of the position of the U.S. dollar versus the New Taiwan dollar, which permits a consistent comparison of results between periods.

The following table contains a reconciliation of GAAP net income per share to net income per share excluding the impact of foreign currency translation gain or loss.

Garmin Ltd. And Subsidiaries

Net income per share, excluding FX

( in thousands, except per share information)

	13-Weeks Ended					26-weeks Ended
	June 30,		July 1,			June 30,			July 1,
	2007		2006			2007			2006
Net Income (GAAP)	$	214,377	$	123,286		$	354,237		$	210,800
Foreign currency (gain) / loss, net of tax effects	$	5,289		($2,499	)		($6,187	)	$	3,793
Net income, excluding FX	$	219,666	$	120,787		$	348,050		$	214,593
Net income per share (GAAP):
Basic	$	0.99	$	0.57		$	1.64		$	0.97
Diluted	$	0.98	$	0.56		$	1.62		$	0.96
Net income per share, excluding FX:
Basic	$	1.02	$	0.56		$	1.61		$	0.99
Diluted	$	1.00	$	0.55		$	1.59		$	0.98
Weighted average common shares outstanding:
Basic		216,380		216,818			216,298			216,594
Diluted		219,078		219,344			218,925			218,868

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 flow less capital expenditures for property and equipment.

The following table contains a reconciliation of GAAP net cash provided by operating activities to free cash flow.

Garmin Ltd. And Subsidiaries

Free Cash Flow

( in thousands)

	13-Weeks Ended						26-Weeks Ended
	June 30,			July 1,			June 30,			July 1,
	2007			2006			2007			2006
Net cash provided by operating activities	$	253,469		$	76,159		$	422,139		$	132,376
Less: purchases of property and equipment		($99,621	)		($11,743	)		($112,020	)		($26,612	)
Free Cash Flow	$	153,848		$	64,416		$	310,119		$	105,764

Earnings Call Information

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

When: Wednesday, August 1, 2007 at 11:00 a.m. Eastern

Where: http://www.garmin.com/aboutGarmin/invRelations/irCalendar.html

How: Simply log on to the web at the address above or call to listen in at 800-883-9537.

Contact: investor.relations@garmin.com

A phone recording will be available for five business days following the earnings call and can be accessed by dialing 800-642-1687 or (706) 645-9291 and utilizing the access code 4552756. An archive of the live webcast will be available until August 17, 2007 on the Garmin website at http://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. Any statements regarding the company’s estimated earnings and revenue for fiscal 2007, the Company’s expected segment revenue growth rate, margins, the number of new products to be introduced in 2007 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 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, 2006 filed by Garmin with the Securities and Exchange Commission (Commission file number 0-31983). A copy of Garmin’s 2006 Form 10-K can be downloaded from http://www.garmin.com/aboutGarmin/invRelations/finReports.html.

Through its operating subsidiaries, Garmin Ltd. designs, manufactures, and markets navigation, communications and information devices, most of which are enabled by GPS technology. Garmin is a leader in the general aviation and consumer markets and its products serve aviation, marine, outdoor, fitness, automotive, mobile and OEM applications. Garmin Ltd. is incorporated in the Cayman Islands, and its principal subsidiaries are located in the United States, Taiwan and United Kingdom. For more information, visit the investor relations site of Garmin Ltd. at www.garmin.com or contact the Investor Relations department at 913-397-8200. Garmin and Forerunner are registered trademarks, and Edge is a trademark of Garmin Ltd. or its subsidiaries.

Garmin Ltd. And Subsidiaries

Condensed Consolidated Balance Sheets (Unaudited)

(In thousands, except share information)

	June 30,			December 30,
	2007			2006
Assets
Current assets:
Cash and cash equivalents	$	667,671		$	337,321
Marketable securities		147,435			73,033
Accounts receivable, net		506,483			403,524
Inventories, net		290,682			271,008
Deferred income taxes		56,934			55,996
Prepaid expenses and other current assets		19,104			28,202
Total current assets		1,688,309			1,169,084
Property and equipment, net		350,299			250,988
Marketable securities		258,445			407,843
Restricted cash		1,558			1,525
Licensing agreements, net		14,804			3,307
Other intangible assets, net		131,186			64,273
Total assets	$	2,444,601		$	1,897,020
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable	$	167,339		$	88,375
Salaries and benefits payable		26,056			16,268
Warranty reserve		49,725			37,639
Other accrued expenses		168,057			100,732
Income taxes payable		16,975			94,668
Total current liabilities		428,152			337,682
Long-term debt, less current portion		-			248
Deferred income taxes		1,010			1,191
Other liabilities		90,470			-
Stockholders' equity:
Common stock		1,085			1,082
Additional paid-in capital		105,525			83,438
Retained earnings		1,832,892			1,478,654
Accumulated other comprehensive loss		(14,533	)		(5,275	)
Total stockholders' equity		1,924,969			1,557,899
Total liabilities and stockholders' equity	$	2,444,601		$	1,897,020

Garmin Ltd. And Subsidiaries

Condensed Consolidated Statements of Income (Unaudited)

(In thousands, except per share information)

	13-Weeks Ended						26-Weeks Ended
	June 30,			July 1,			June 30,			July 1,
	2007			2006			2007			2006
Net sales	$	742,466		$	432,468		$	1,234,625		$	754,779
Cost of goods sold		367,799			216,184			622,206			375,706
Gross profit		374,667			216,284			612,419			379,073
Selling, general and administrative expenses		95,373			54,915			161,297			92,678
Research and development expense		37,727			26,793			71,230			51,707
		133,100			81,708			232,527			144,385
Operating income		241,567			134,576			379,892			234,688
Other income (expense):
Interest income		10,841			8,538			20,199			15,843
Interest expense		(23	)		(5	)		(55	)		(12	)
Foreign currency		(6,086	)		2,958			7,119			(4,488	)
Other		338			(167	)		389			3,437
		5,070			11,324			27,652			14,780
Income before income taxes		246,637			145,900			407,544			249,468
Income tax provision		32,260			22,614			53,307			38,668
Net income	$	214,377		$	123,286		$	354,237		$	210,800
Net income per share:
Basic	$	0.99		$	0.57		$	1.64		$	0.97
Diluted	$	0.98		$	0.56		$	1.62		$	0.96
Weighted average common shares outstanding:
Basic		216,380			216,818			216,298			216,594
Diluted		219,078			219,344			218,925			218,868

Garmin Ltd. And Subsidiaries

Condensed Consolidated Statements of Cash Flows (Unaudited)

(In thousands)

	26-Weeks Ended
	June 30,			July 1,
	2007			2006
Operating Activities:
Net income	$	354,237		$	210,800
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation		13,479			10,211
Amortization		15,856			17,055
Loss (gain) on sale of property and equipment		18			191
Provision for doubtful accounts		1,808			2,038
Deferred income taxes		(725	)		(13,478	)
Foreign currency transaction gains/losses		(10,358	)		2,392
Provision for obsolete and slow moving inventories		17,309			9,336
Stock compensation expense		7,196			4,759
Realized gains on marketable securities		-			(3,852	)
Changes in operating assets and liabilities:
Accounts receivable		(88,405	)		(126,836	)
Inventories		(33,406	)		(37,408	)
Other current assets		9,059			(11,135	)
Accounts payable		63,472			13,119
Other current and non-current liabilities		101,826			56,503
Income taxes		6,937			143
Purchase of licenses		(22,290	)		(1,462	)
Net cash provided by operating activities		422,139			132,376
Investing activities:
Purchases of property and equipment		(112,020	)		(26,612	)
Purchase of intangible assets		(1,881	)		(1,115	)
Purchase of marketable securities		(378,909	)		(231,870	)
Redemption of marketable securities		455,598			150,222
Change in restricted cash		(33	)		(92	)
Net cash paid for acquisition of businesses and other intangibles		(68,902	)		-
Net cash used in investing activities		(106,147	)		(109,467	)
Financing activities:
Proceeds from issuance of common stock		7,534			9,479
Payments on long term debt		(248	)		-
Tax benefit related to stock option exercise		7,360			6,988
Net cash provided by financing activities		14,646			16,467
Effect of exchange rate changes on cash and cash equivalents		(288	)		216
Net increase in cash and cash equivalents		330,350			39,592
Cash and cash equivalents at beginning of period		337,321			334,352
Cash and cash equivalents at end of period	$	667,671		$	373,944

Garmin Ltd. And Subsidiaries

Revenue, Gross Profit, and Operating Income by Segment (Unaudited)

	Reporting Segments
	Outdoor/				Auto/
	Fitness		Marine		Mobile		Aviation		Total
13-Weeks Ended June 30, 2007
Net sales	$	77,163	$	79,771	$	507,895	$	77,637	$	742,466
Gross profit	$	43,648	$	46,381	$	233,520	$	51,118	$	374,667
Operating income	$	28,600	$	33,115	$	149,067	$	30,785	$	241,567
13-Weeks Ended July 1, 2006
Net sales	$	71,115	$	50,115	$	255,387	$	55,851	$	432,468
Gross profit	$	42,469	$	29,823	$	107,061	$	36,931	$	216,284
Operating income	$	31,617	$	21,146	$	59,974	$	21,839	$	134,576
26-Weeks Ended June 30, 2007
Net sales	$	137,690	$	122,775	$	824,520	$	149,640	$	1,234,625
Gross profit	$	77,063	$	67,534	$	370,251	$	97,571	$	612,419
Operating income	$	49,809	$	44,410	$	228,591	$	57,082	$	379,892
26-Weeks Ended July 1, 2006
Net sales	$	134,761	$	100,818	$	406,116	$	113,084	$	754,779
Gross profit	$	78,812	$	57,839	$	170,147	$	72,275	$	379,073
Operating income	$	56,298	$	40,059	$	96,264	$	42,067	$	234,688