Garmin hints at higher watch prices heading into 2027

Garmin has now acknowledged something buyers probably will not love hearing. Higher prices are one of the options on the table as component costs rise heading into 2027.

The comments came during today’s Q3 earnings call where CEO Cliff Pemble was asked directly about pricing power. At the same time, Garmin revealed that Connect Plus is performing better than expected, giving the company another way to make more from its growing user base.

Higher prices are now on the table

Garmin says memory costs have risen sharply compared with last year because of strong demand and limited supply. The company has been protected so far by inventory bought at lower prices, but that buffer is starting to run out.

The impact was small in Q3, but Garmin expects it to become more noticeable in Q4 and continue into 2027. Management also expects gross margins to move back towards historical levels next year, largely because of higher memory costs.

During the Q&A, Garmin CEO Cliff Pemble was asked whether the company could use its pricing power to offset those higher costs. He said pricing is one of the tools available, although Garmin would look at several ways to protect margins rather than relying on price increases alone.

That is not confirmation that Garmin watches are about to get more expensive. The company has not announced any increases, named any affected products or provided a timetable.

Still, the possibility is now clearly on the table. Garmin also noted that many of its newer products are premium devices that command higher margins, giving the company more room to adjust pricing if costs remain elevated. So if you think the Fenix 9 was expensive, your wallet may want to skip 2027.

Connect Plus is beating expectations

Meanwhile, Connect Plus is growing faster than expected. Pemble said renewals after free trial periods have been strong.

The company even highlighted CIRQA as one of the devices helping drive subscriptions. Some owners of the new screenless tracker are signing up for Connect Plus to get additional features from the device.

Garmin still describes Connect Plus as optional rather than essential. Core device functionality remains available without a subscription, while extras such as nutrition tracking sit behind the paid service.

The company also confirmed that it has a longer-term roadmap for expanding Connect Plus. That suggests the number of paid features is likely to grow, even if Garmin continues to keep the main watch and fitness features outside the subscription.