Garmin: revenue from phone segment in Q2 was 'below our plan'
byChris Ziegler||August 5th 2010 at 12:54pmAugust 5th 2010 12:54 pm
Garmin's second-quarter results hit the wires this week, and overall, the company seems to be pretty healthy; its automotive, outdoor, aviation, and marine businesses all posted growth, average selling price was up, and shipped units grew a solid 8 percent year-over-year. If you read a little deeper, though, there's one segment that undelivered -- smartphones, a joint venture the company shares with ASUS -- which contributed $27 million in revenue in the last three months. $27 million in profit would be business as usual for a division of a company of Garmin's size, but $27 million in revenue is a drop in the bucket -- and sure enough, the earnings report goes on to say that the performance was "below [its] plan." They go on to say that they're "working aggressively with T‐Mobile and other carriers around the globe on the appropriate positioning and pricing of our devices in the competitive smartphone space," interesting wording considering our shock at the Garminfone's initial pricing (and the fact that it's more recently come down to $130 for new subscribers). In Garmin's own words, the smartphone business is competitive to say the least -- you can't waltz in with an overpriced first-gen product and expect the world -- so it'll be interesting to see how they adjust going forward.