In the third quarter, we generated $202 million of free cash flow (see attached table for reconciliation of this non-GAAP measure). We continued to return cash to shareholders with our quarterly dividend of approximately $92 million and our share repurchase activity which totaled $79 million in the current quarter. We have now fully executed the $300 million share repurchase plan and have returned approximately 100% of our forecasted 2014 free cash flow to shareholders via the dividend and share repurchase. As we have done in recent years, we will reassess our capital return strategy in conjunction with our 2015 guidance in February 2015. We currently have almost $2.8 billion of cash and marketable securities allowing us a significant level of flexibility to utilize our balance sheet to continue to generate long-term shareholder value.

2014 Guidance:

Due to our continued strong results in the third quarter, we are revising our guidance to reflect our outlook for the remainder of the year. We now anticipate revenues of approximately $2.85 billion, the high end of our prior guidance, with gross and operating margins of 56% and 24%, respectively. Given the full year effective tax rate of 17%, we forecast pro forma EPS of approximately $3.10. As indicated last quarter, our guidance anticipates promotional pricing for the holiday season, as well as higher spending in marketing and advertising to support new product categories, resulting in slightly lower margins in the fourth quarter.

Webcast Information/Forward-Looking Statements:

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

	When:		Wednesday, October 29, 2014 at 10:30 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 888-312-9865

An archive of the live webcast will be available until December 24, 2014 on the Garmin website at 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 2014, the Company’s expected segment revenue growth rate, margins, new products to be introduced in 2014 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 28, 2013 filed by Garmin with the Securities and Exchange Commission (Commission file number 0-31983). A copy of Garmin’s 2013 Form 10-K can be downloaded from http://www.garmin.com/aboutGarmin/invRelations/finReports.html.

Garmin, Approach, Alpha, VIRB, Forerunner and Fusion are registered trademarks and fēnix, vívosmart, and Connect IQ are trademarks of Garmin Ltd. or its subsidiaries. All other brands, product names, company names, trademarks and service marks are the properties of their respective owners. All rights reserved.

Garmin Ltd. And Subsidiaries
Condensed Consolidated Statements of Income (Unaudited)
(In thousands, except per share information)
		13-Weeks Ended								39-Weeks Ended
		Sept 27,				Sept 28,				Sept 27,				Sept 28,
			2014				2013				2014				2013
Net sales		$	706,283			$	643,637			$	2,067,352			$	1,872,156
Cost of goods sold			308,037				290,748				893,788				859,494
Gross profit			398,246				352,889				1,173,564				1,012,662
Advertising expense			33,112				26,251				92,457				77,983
Selling, general and administrative expense			90,632				86,462				272,914				260,769
Research and development expense			98,998				88,427				293,567				272,349
Total operating expense			222,742				201,140				658,938				611,101
Operating income			175,504				151,749				514,626				401,561
Other income (expense):
Interest income			9,344				8,435				28,781				25,512
Foreign currency gains (losses)			(12,703	)			(822	)			(20,266	)			18,280
Other			517				1,438				707				3,666
Total other income (expense)			(2,842	)			9,051				9,222				47,458
Income before income taxes			172,662				160,800				523,848				449,019
Income tax provision (benefit)			319,496				(26,869	)			369,882				192
Net income (loss)			($146,834	)		$	187,669			$	153,966			$	448,827
Net income (loss) per share:
Basic			($0.76	)		$	0.96			$	0.79			$	2.30
Diluted			($0.76	)		$	0.96			$	0.79			$	2.29
Weighted average common
shares outstanding:
Basic			192,239				195,325				193,700				195,488
Diluted			192,239				196,300				194,763				196,312
Dividends declared per share										$	1.92			$	1.80

Garmin Ltd. And Subsidiaries
Condensed Consolidated Balance Sheets
(In thousands)
		(Unaudited)
		Sept 27,				December 28,
			2014				2013
Assets
Current assets:
Cash and cash equivalents		$	1,154,558			$	1,179,149
Marketable securities			151,366				149,862
Accounts receivable, net			478,722				564,586
Inventories, net			466,482				382,226
Deferred income taxes			59,186				69,823
Deferred costs			52,113				57,368
Loan receivable			-				137,379
Prepaid expenses and other current assets			59,058				55,243
Total current assets			2,421,485				2,595,636
Property and equipment, net			431,753				414,848
Marketable securities			1,453,047				1,502,106
Restricted cash			293				249
Noncurrent deferred income tax			84,345				88,324
Noncurrent deferred costs			35,272				41,157
Other intangible assets, net			221,566				219,494
Other assets			21,603				17,789
Total assets		$	4,669,364			$	4,879,603
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable		$	144,882			$	146,582
Salaries and benefits payable			67,496				59,794
Accrued warranty costs			26,543				26,767
Accrued sales program costs			38,699				50,903
Deferred revenue			210,621				256,908
Accrued royalty costs			52,558				64,538
Accrued advertising expense			23,480				19,448
Other accrued expenses			77,157				65,657
Deferred income taxes			6,823				989
Income taxes payable			197,846				38,043
Dividend payable			277,378				175,675
Total current liabilities			1,123,483				905,304
Deferred income taxes			36,073				1,758
Non-current income taxes			135,911				140,933
Non-current deferred revenue			136,025				171,012
Other liabilities			1,459				890
Stockholders' equity:
Shares, CHF 10 par value, 208,077 shares authorized and issued;
191,227 shares outstanding at September 27, 2014
and 195,150 shares outstanding at December 28, 2013			1,797,435				1,797,435
Additional paid-in capital			92,144				79,263
Treasury stock			(350,063	)			(120,620	)
Retained earnings			1,649,727				1,865,587
Accumulated other comprehensive income			47,170				38,041
Total stockholders' equity			3,236,413				3,659,706
Total liabilities and stockholders' equity		$	4,669,364			$	4,879,603

Garmin Ltd. And Subsidiaries
Condensed Consolidated Statements of Cash Flows (Unaudited)
(In thousands)
			39-Weeks Ended
			Sept 27,				Sept 28,
				2014				2013
Operating Activities:
Net income			$	153,966			$	448,827
Adjustments to reconcile net income to net cash
provided by operating activities:
	Depreciation			35,860				36,840
	Amortization			19,705				23,629
	(Gain) loss on sale of property and equipment			(742	)			41
	Provision for doubtful accounts			778				1,023
	Deferred income taxes			55,235				2,851
	Unrealized foreign currency loss (gain)			22,610				(17,273	)
	Provision for obsolete and slow moving inventories			21,051				15,965
	Stock compensation expense			18,988				15,608
	Realized loss (gain) on marketable securities			685				(2,963	)
Changes in operating assets and liabilities:
	Accounts receivable			74,323				128,098
	Inventories			(107,273	)			(44,337	)
	Other current and non-current assets			1,528				(18,329	)
	Accounts payable			(3,209	)			21,936
	Other current and non-current liabilities			(1,997	)			(60,719	)
	Deferred revenue			(80,712	)			(22,613	)
	Deferred cost			11,136				(57	)
	Income taxes payable			155,762				(48,256	)
Net cash provided by operating activities				377,694				480,271
Investing activities:
Purchases of property and equipment				(54,829	)			(41,325	)
Proceeds from sale of property and equipment				748				65
Purchase of intangible assets				(9,422	)			(1,574	)
Purchase of marketable securities				(746,305	)			(716,226	)
Redemption of marketable securities				807,778				578,464
Proceeds from repayment (advances) on loan receivable				137,379				(173,708	)
Change in restricted cash				(44	)			584
Acquisitions, net of cash acquired				(18,871	)			(5,686	)
Net cash provided by (used in) investing activities				116,434				(359,406	)
Financing activities:
Dividends paid				(268,023	)			(263,857	)
Purchase of treasury stock under share repurchase plan				(241,460	)			(26,926	)
Purchase of treasury stock related to equity awards				(11,274	)			(7,430	)
Proceeds from issuance of treasury stock related to equity awards				12,761				13,620
Tax benefit from issuance of equity awards				4,422				411
Net cash used in financing activities				(503,574	)			(284,182	)
Effect of exchange rate changes on cash and cash equivalents				(15,145	)			837
Net decrease in cash and cash equivalents				(24,591	)			(162,480	)
Cash and cash equivalents at beginning of period				1,179,149				1,231,180
Cash and cash equivalents at end of period			$	1,154,558			$	1,068,700

Garmin Ltd. And Subsidiaries
Revenue, Gross Profit, and Operating Income by Segment (Unaudited)
		Reporting Segments
											Auto/
		Outdoor			Fitness			Marine			Mobile			Aviation			Total
13-Weeks Ended Sep 27, 2014
Net sales		$	121,079		$	116,171		$	62,128		$	307,558		$	99,347		$	706,283
Gross profit		$	79,227		$	74,056		$	31,510		$	140,995		$	72,458		$	398,246
Operating income		$	51,382		$	36,670		$	5,452		$	53,042		$	28,958		$	175,504
13-Weeks Ended Sep 28, 2013
Net sales		$	101,350		$	81,007		$	55,301		$	322,520		$	83,459		$	643,637
Gross profit		$	69,471		$	49,328		$	27,265		$	147,866		$	58,959		$	352,889
Operating income		$	44,107		$	26,493		$	4,118		$	53,848		$	23,183		$	151,749
39-Weeks Ended Sep 27, 2014
Net sales		$	311,123		$	367,137		$	195,911		$	900,545		$	292,636		$	2,067,352
Gross profit		$	194,805		$	236,204		$	105,097		$	422,379			215,079		$	1,173,564
Operating income		$	110,345		$	133,054		$	26,919		$	158,248		$	86,060		$	514,626
39-Weeks Ended Sep 28, 2013
Net sales		$	284,372		$	237,660		$	178,344		$	919,810		$	251,970		$	1,872,156
Gross profit		$	184,333		$	149,368		$	91,550		$	410,348		$	177,063		$	1,012,662
Operating income		$	110,538		$	76,026		$	16,089		$	134,324		$	64,584		$	401,561

Garmin Ltd. And Subsidiaries
Revenue by Geography (Unaudited)
		13-Weeks Ended									39-Weeks Ended
		Sep 27,				Sep 28,			Yr over Yr		Sep 27,			Sep 28,			Yr over Yr
		2014					2013		Change			2014			2013		Change
Net sales		$	706,283			$	643,637		10%		$	2,067,352		$	1,872,156		10%
Americas			374,111				333,448		12%			1,090,267			1,002,796		9%
EMEA			260,830				245,659		6%			781,860			692,836		13%
APAC			71,342				64,530		11%			195,225			176,524		11%
EMEA - Europe, Middle East and Africa; APAC - Asia Pacific

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