Kerri Thurston - Director of Investor Relations Clifton A. Pemble - Chief Executive Officer, President, Director, President of Garmin International Inc, President of Garmin USA Inc and President of Garmin AT Inc Kevin S. Rauckman - Chief Financial Officer, Principal Accounting Officer, Treasurer, Treasurer of Garmin International Inc, Treasurer of Garmin Usa Inc, Director of Garmin International Inc and Director of Garmin Usa Inc

Yair Reiner - Oppenheimer & Co. Inc., Research Division Charles L. Anderson - Dougherty & Company LLC, Research Division Simona Jankowski - Goldman Sachs Group Inc., Research Division John F. Bright - Avondale Partners, LLC, Research Division Mark Sue - RBC Capital Markets, LLC, Research Division Andrew Spinola - Wells Fargo Securities, LLC, Research Division Paul Coster - JP Morgan Chase & Co, Research Division Jonathan Ho - William Blair & Company L.L.C., Research Division Tavis C. McCourt - Raymond James & Associates, Inc., Research Division Benjamin James Bollin - Cleveland Research Company Brad Erickson - Pacific Crest Securities, Inc., Research Division Jeremy David - Citigroup Inc, Research Division

Good day, everyone, and welcome to today's Garmin Ltd. Fourth Quarter 2013 Earnings Call. As a reminder, today's call is being recorded. At this time, I'd like to turn the call over to Ms. Kerri Thurston. Please go ahead, ma'am.

Good morning, everyone. We'd like to welcome you to Garmin Ltd.'s Fourth Quarter 2014 Earnings Call. Please note that the earnings press release and the related slides are available on Garmin's Investor Relations site on the Internet at www.garmin.com/doc. An archive of the webcast and a related transcript will be available on the website later today. This earnings call includes projections and other forward-looking statements regarding Garmin Ltd. and its business. Any statements regarding our future financial position, revenues, earnings, market share, product introductions, future demand for our products and objectives are forward-looking statements. The forward-looking events and circumstances discussed in this earnings call may not occur, and actual results could differ materially as a result of risk factors affecting Garmin. Information concerning these risk factors is contained in our Form 10-K that is filed with the Securities and Exchange Commission. We will be filing our 2013 10-K later today. Presenting on behalf of Garmin Ltd. this morning are Cliff Pemble, President and Chief Executive Officer; and Kevin Rauckman, Chief Financial Officer and Treasurer. At this time, I'll turn the call over to Cliff. Clifton A. Pemble: Thank you, Kerri, and good morning, everyone. As announced earlier today, Garmin reported strong fourth quarter revenue and margin performance, which contributed to a 12% increase in pro forma EPS. Outdoor, Fitness, Aviation and Marine increased 14% on a combined basis, which largely offset lower revenues in Auto/Mobile. These growth segments represented 50% of our revenue in the holiday quarter. Growth in operating margins improved year-over-year to 52% and 23%, respectively. Gross margin strength was driven by the revenue mix shifting towards our higher-margin segments and a lower amount of revenue deferrals on a year-over-year basis. Operating income increased 16% due to stronger gross margins combined with expense control. This allowed us to maintain our emphasis on R&D while keeping overall expenses relatively flat on a year-over-year basis. As a result, operating income grew in each of our 5 business segments and we generated $135 million in free cash flow during the quarter. We are pleased with our Q4 performance and it gives us a strong foundation to build upon as we begin 2014. Looking briefly at full year performance, we achieved record revenue in our growth segments. However, ongoing declines in the PND category resulted in lower consolidated revenue, as we expected, down 3% for the year. On a combined basis, our growth segments contributed over $1.3 billion in revenue for the year, or 51% of the total, and generated 67% of our operating income. Gross and operating margins were stable compared to 2012, resulting in strong profit generation despite pressure in the PND market and an increased level of R&D spending during the year. Kevin will further discuss margins in his remarks. For the full year, we generated $574 million of free cash flow, exceeding our expectations of $525 million. The cash was primarily used to fund our quarterly dividend and share repurchase programs throughout 2013. So next, we'll review each of our business segments, highlighting 2013 performance, the 2014 outlook and a brief summary of long-term strategic initiatives. Starting first with Outdoor, we reported year-over-year revenue growth of 2%, with growth accelerating in the fourth quarter due to new product introductions. Wearables, golf products, dog tracking and training and action cameras contributed to this growth. The Outdoor segment continued to generate strong gross and operating margins in 2013 at 64% and 39%, respectively. The most significant product introduction in 2013 was the VIRB action camera series, which contributed to stronger growth in the fourth quarter. Looking at 2014, we expect revenue growth of 10% to 15%, driven by growth in action cameras, golf, and dog tracking and training devices. Beyond 2014, we will focus on new opportunities in adjacent markets where we can leverage our brand and global distribution. We will make additional investments in the action camera market to broaden our product line and drive market share gains. In addition, we will maintain our focus on utility, content and innovative form factors to track both new and repeat customers, while embracing the opportunities to enhance the user experience via connectivity. In the Fitness segment, we reported year-over-year revenue growth of 11%, which outpaced both our expectations and prior year growth. We expanded our leadership position in the GPS-enabled Fitness category with the introduction of new Edge cycling computers and Forerunner watches. In addition, we expanded our role in the cycling market with the introduction of the Vector power meter. The return to double-digit growth in the second half of 2013 gives us confidence that the Fitness market remains underpenetrated and that our products continue to be well-positioned from a competitive perspective. Though we have faced significant competition in recent years, our portfolio of differentiated products has resulted in strong gross and operating margins of 63% and 34%, respectively. In 2014, we are targeting revenue growth of 10% to 15% in the Fitness segment. A key component of this growth is the recent launch of the vívofit and vívokí activity monitors, which establish a new standard for utility and innovation in this emerging product category. In addition, we plan to further penetrate the cycling and running markets with our recently launched products and others that are yet to come during the year. Looking beyond 2014, we believe that opportunities within fitness and wellness will continue to expand as global consumers become increasingly health conscious. We will focus on delivering compelling form factors and innovative products to the market, offering a complete solution of device, wireless connectivity, measurement sensors and a compelling web portal. We will leverage the redesigned Garmin Connect website to further expand our community of users with enhanced support for a broad range of activities and social networking among participants. Finally, we'll gain share in the activity monitor market by delivering industry-leading utility and form factors that meet the needs of a diverse set of customers. Turning next to Aviation, we reported year-over-year revenue growth of 16%, as both OEM and aftermarket performed well. Operating income increased 20% for the year, ahead of revenue growth as gross margin improved and expenses were in line with sales. A key achievement in 2013 was the completion of our first Part 25 certifications with Cessna and Bombardier. In addition, we launched new or enhanced systems with Embraer, Piper, Bell and AgustaWestland. In 2014, we are targeting revenue growth of 10% to 15% in the Aviation segment. Stable conditions in the OEM market, combined with a full year of revenue contributions from new platforms, will result in growth for OEM products. In addition, we anticipate positive signals in the aftermarket will continue in the coming year and contribute to overall segment growth. Longer term, our growth initiatives are focused on continued development of our G3000 and G5000 platforms with OEM partners, which is the foundation for long-term market share expansion, identifying aftermarket opportunities, as well as commercial off-the-shelf opportunities within the military and government sector, developing unique technologies that fill gaps in our current product portfolio, and capitalizing on opportunities created by the FAA's transformation of the National Airspace System from a ground-based system of air traffic control to a satellite-based system of air traffic management. Moving next to the Marine segment, we reported year-over-year revenue growth of 7%, with accelerated growth in the second half of the year when we delivered a significant number of new products to the market. Gross and operating margins declined as we faced competitive pricing pressure, unfavorable product mix and higher R&D expenses associated with expanding our product portfolio. Though this reduced segment profitability in the short term, we expect to see revenue growth and improved profitability going forward. For 2014, we are targeting revenue growth of 10% to 15% in the Marine segment as we anticipate market conditions will improve and recent product introductions will generate new revenue opportunities. New product contributions include a full year of our Glass Helm products, as well as contributions from new chartplotters and fishfinders, which we introduced late last year and have already been delivered to the market. In the long term, our objective is to increase our market share in recreational boating with specific emphasis on fishing and sailing markets. We plan to grow our OEM position by leveraging our full range of products including chartplotters, radar, sonar, autopilots and audio systems. And finally, through continued innovation and efficiency, we will deliver new products and improve the operating margin performance of our Marine business over the long term. Looking finally at the Auto/Mobile segment, revenues declined 13% for the full year as lower PND revenues were partially offset by growth in OEM and mobile product categories. According to our estimates, we exited the year with approximately 45% market share on a global basis and achieved 81% share in the fourth quarter in the U.S. market, representing an all-time high watermark for Garmin. Though the industry headwinds were challenging, segment margins remained strong, generating over $188 million of operating income for the year. A key highlight in 2013 was the announcement of our relationship with Mercedes, providing navigation solutions beginning in some 2014 models and all models by 2017. Looking at 2014, we expect PND unit deliveries to decline in line with 2013 rates, driving revenues down 10% to 15% in the segment. We will focus on market share leadership and maximizing profitability in PNDs while capitalizing on new opportunities such as dash cameras and portable HUD solutions. We will continue to invest in Auto OEM opportunities, leveraging our complete range of capabilities from fully integrated entertainment platforms to navigation-focused software solutions. Beyond 2014, we will focus on expanding our Auto OEM business through additional program wins, delivering the most intuitive and advanced in-vehicle experience, managing the profitability of the PND segment as the market size continues to decline and capitalizing on niche opportunities in motorcycle, fleet management, over-the-road trucking and RV. While no single product can offset the trends in the PND market, we are excited about the numerous incremental opportunities to enhance revenue and profitability in 2014. With this in mind, we are projecting revenues of $2.6 billion to $2.7 billion, with gross margins increasing to 54% to 55% due to segment mix. We are projecting operating income between $530 million and $565 million, with operating margins of approximately 21% as we grow our R&D investment and manage other expenses in line with revenue and opportunity. Factoring in an anticipated effective tax rate of 17%, 2014 pro forma earnings per share should fall in the range of $2.50 to $2.60 with free cash flow generation of $550 million to $600 million. Given our cash flow outlook, we will propose an increase in the dividend at our upcoming annual meeting, and we will participate in share repurchases as market conditions warrant. We believe these actions will result in strong returns for our shareholders over the long term. And finally, you'll see in our press release that Kevin has decided to change the intense pace he has managed over the years. We wish Kevin all the best in the future, but we're going to miss him very much. Kevin will offer some additional remarks on his transition in a moment, but I want to take this opportunity to thank you, Kevin, for all you've done for Garmin over the past 15 years. That concludes my remarks. Kevin will now walk through our Q4 and full year financials in more detail. So Kevin, take it away. Kevin S. Rauckman: Thanks, Cliff, and good morning, everyone. I'd like to begin by reviewing our financial results then move to some summary comments on the balance sheet, cash flow, taxes and, finally, 2014 guidance. So we posted revenue of $760 million for the quarter with pro forma net income of $150 million. Our pro forma EPS was $0.76 per share, excluding the foreign currency gain. Our revenue represents a decrease of just 1% year-over-year. And gross margin came in at 52%, a 330 basis point increase from the prior year, driven by segment mix and reduced impact from deferred revenues. Operating margin was 23%, an increase of 320 basis points from the prior year with gross margin favorability of 330 basis points, offset by an unfavorable operating expense impact of 10 basis points. Total operating expenses decreased by $2 million in the current quarter with reduced spending in advertising, partially offset by a $10 million increase in research and development. Each of the operating expense categories will be discussed in detail on a later slide. Our pro forma EPS, which is adjusted for the foreign currency gain, was $0.76, representing a 12% increase year-over-year. We shipped 4.5 million units during the quarter, which represents an 11% decrease year-over-year. Our total company average selling price was $169 per unit, up 11% from $152 in the fourth quarter of 2012, driven primarily by segment mix and the reduced revenue deferrals. Looking at full year results, we posted revenue of $2.6 billion for the year, with pro forma net income of $514 million. Our pro forma EPS was $2.62 per share, which excludes FX gains and $68 million of our income tax reserve releases during the year. Our revenue decreased 3% year-over-year, and our gross margin was 53%; it had a 50 basis point improvement over the prior year. Operating income decreased 5% to $574 million compared to $604 million in 2012. Our operating margin was 22%, down 40 basis points from last year. The pro forma of $2.62 was down 8% year-over-year. Units shipped were down 10% with 13.9 million units delivered during 2013. Next, you can see from our -- how our fourth quarter revenue breaks down by segment. I would just like to briefly highlight the charts on this page which illustrate the Auto/Mobile segment representing 50% of our total revenue during Q4 of 2013 as each of the non-Auto/Mobile segments grew during the quarter. You can see from our profitability mix by segment that our non-Auto/Mobile segments delivered 69% of operating income in the quarter, an increase from 66% in Q4 of 2012. Fitness, Aviation and Marine each contributed an increasing proportion of total operating income in Q4 due to revenue growth and improving or stable operating margins. I'd like to briefly discuss year-over-year gross margin changes by segment. Auto/Mobile gross margin increased to 40% from 38% in the prior year, primarily due to less deferred high-margin revenues. Marine and Fitness gross margins improved in the current quarter due to product mix shifting towards new products in the quarter. So our total corporate operating margin improved to 23% due to the increased gross margin during the period. Looking briefly at year-to-date metrics, revenue contribution for 2013 shifted toward our growth segments, with Aviation, Fitness and Outdoor each growing in contribution. A similar shift is occurring in operating income with 67% of our 2013 operating income coming from our non-Auto/Mobile segments. As previously mentioned, the Q4 operating expenses decreased by $2 million on a year-over-year basis from $224 million in Q4 to $222 million in Q4 of 2013 while increasing 10 basis points as a percent of sales. R&D increased $10 million year-over-year, and this represented a 140 basis point impact as R&D increased to 12% of sales. We continue to invest in innovation and grow our engineering workforce with a heavy emphasis on Aviation, Outdoor and Fitness. Our advertising spending decreased $12 million over the year-ago quarter, and decreased 150 basis points as a percent of sales to 5% in Q4 of 2013. Much of the decrease was related to declining volumes in PND, as well as reduced media spending. We will continue to scale our advertising expense to match our revenue trends. SG&A was up $1 million compared to the year-ago quarter, increasing 20 basis points while holding steady at 12% of sales. We are working diligently to manage these expenses as our PND market declines. Next, to balance sheet and cash flow. We ended the quarter with cash and marketable securities of over $2.8 billion. Accounts receivable increased sequentially to $565 million due to holiday sales. Our accounts receivable accounted for 79 days of sales compared to 81 days of sales in the fourth quarter of 2012. Our inventory balance decreased to $382 million on a sequential basis at the close of fourth quarter, as we exited the stronger holiday quarter. Our days of inventory were 114 days compared to 117 days in the fourth quarter of 2012. We continue to generate strong free cash flow across our business as cash from operations was $150 million during Q4. CapEx was $15 million during the fourth quarter. Therefore, we generated free cash flow of $135 million during the fourth quarter, and our free -- full year free cash flow was $574 million, coming in ahead of forecast. We repurchased $31 million of company stock and have $241 million still authorized through December of 2014. A few more items to discuss relative to our Q4 announcement. Our effective tax rate for Q4 of 2013 was 20% compared to 16.5% in Q4 2012. The increased rate was primarily driven by an unfavorable change in income mix by a taxing jurisdiction and reduced tax holidays in Taiwan. Our full year pro forma rate adjusted for the $68 million of reserve releases was 16.8%. We expect our full year rate for 2014 to be approximately 17% due to the geographic mix of income. We also announced in our press release this morning that given our strong free cash flow generation, we plan to seek shareholder approval for an increased dividend beginning with the June 2014 calendar quarter. The proposal is $0.48 per quarter, or $1.92 annually, an increase from our current $0.45 per quarter. Cliff has reviewed our 2014 guidance, but I would just further highlight that we have 4 solid growth segments that we anticipate will represent over 55% of our revenue in 2014. As highlighted in our guidance, we will continue to invest in 2014 for long-term growth opportunities across the entire business, positioning us well for the future. And before moving to Q&A, I wanted to briefly address the CFO transition that was also announced this morning. I've enjoyed being part of the Garmin family for the past 15 years, and I'm very excited about the future success of Garmin. It's been so rewarding to be part of building such an amazing organization since we went public in the year 2000. Yet, it's time for me to change pace personally. I look forward to helping the executive team with the CFO search process and ensuring a smooth transition. I will also continue to be actively involved in the Investor Relations activities during the transition, where, hopefully, will be able to see many of you in person over the course of this year. With that, operator, we now open the line for Q&A.

[Operator Instructions] We'll first go to Yair Reiner with Oppenheimer. Yair Reiner - Oppenheimer & Co. Inc., Research Division: Great. Kevin, congrats to you, and you've done a great job for 15 years. Kevin S. Rauckman: Thanks very much. Thanks for the well wishes on the quarter. Yair Reiner - Oppenheimer & Co. Inc., Research Division: So I guess looking at 2 of the products you've highlighted as driving growth this year, VIRB and vívofit, I don't know if you can tell us how much you're estimating that contribution. And if you can't give us a number, maybe you can help us think kind of structurally about how you go about estimating a new product, and maybe what you're seeing in the near term in terms of sell-in for those products over the next couple of quarters? Kevin S. Rauckman: Well, we're not prepared to give specific expectations on each of those products. I think maybe the better way to put it is, we -- for both VIRB and for the vívofit, these are exciting markets to be in, and there's some strong incumbents in both areas. We hope to gain some reasonable market share, and it is -- I'd say in both of those instances, it's a reason for some of the growth that we're planning for both Outdoor and Fitness segment that we're not planning to quantify how much that is at this point. Yair Reiner - Oppenheimer & Co. Inc., Research Division: Okay. If I look at the midpoint of your revenue guidance 2014, it looks like you should inflect to some top line growth for the first time in a while. You're sitting on an awful lot of cash on the balance sheet. Given the inflection point, is it time to get more aggressive in terms of buybacks and returning some of that or a lot more of that cash to shareholders? Kevin S. Rauckman: Well, I think your first point, yes. We do anticipate being slightly up in revenue at the midpoint, like you say. And we've been more aggressive and we still, like I said, we still have $241 million in the outstanding buyback plan, and we plan to use our cash to continue to buy back stock based on stock price. We were always sensitive to the stock price like many of our shareholders are, but I don't know if I would say we're going to be more aggressive other than we're -- it's a part of our use of cash, and we can balance that with the other needs across the business.

Next, we'll go to Charlie Anderson with Dougherty & Company. Charles L. Anderson - Dougherty & Company LLC, Research Division: Yes. Best wishes for Kevin. I wondered if we can focus on the Aviation gross margins, extremely strong in the quarter, maybe some of the underlying drivers of that. I know you're moving to maybe more of a more software as a portion of mix, but the sustainability of that, especially as Part 25 starts to layer in, detail on that would be great. Kevin S. Rauckman: Well, I think on the mix of gross margin within that business, I think -- the nice thing is whether it's an OEM or it's a retrofit business or even our portable business, as part of our Aviation segment, we have high margins. You mentioned software, so without a doubt, software is a strong component of our overall suite of avionics that we put into play. So I think that's going to continue. We don't -- these aren't really changing anytime soon, and we've been very stable at our gross margin within the segment. Charles L. Anderson - Dougherty & Company LLC, Research Division: And then, also in Aviation, how should we think about sort of the leverage in 2014? Is it somewhat muted by some of these R&D investments you guys are talking about? Help us understand sort of where you're trending there as well. Kevin S. Rauckman: Well, we mentioned -- both Cliff and I mentioned the Aviation is a significant part of our story in the future, and it is a large part of our R&D investment in 2014. So we're expecting that, I think, at a minimum, the operating margin should stay flat, if not increased, depending on how that market develops over 2014.

Next, we go to Simona Jankowski with Goldman Sachs. Simona Jankowski - Goldman Sachs Group Inc., Research Division: Yes. I just wanted to dig in a little bit more into the Outdoor segment guidance. It seems that the action camera market is a couple of billion dollar market, yet you're not expecting that much of a bump to this year's revenues. Is that just conservatism as you're still relatively new to the market? And also, if you can give us some insight into how much of the channel you've developed in terms of either big box retailers for the VIRB or also some of the specialty ski shops and things like that. Clifton A. Pemble: Well, Simona, the action camera market, according to our estimates, is probably in the range of $1 billion to $2 billion. As you know, it's heavily dominated by an entrenched competitor right now, who has established and defined the market. So we know we have an uphill battle to gain share, and we are admittedly being cautious and conservative in terms of our expectations around the market. But that said, we're -- we feel like we're in this for the long haul. This is a marathon, not a sprint. And so, we're willing to be patient, develop our product line and create innovation in the market that customers are wanting. In terms of the channel, last time we talked, I think we mentioned that the rollout of the VIRB was admittedly conservative, because it was late in the season, and wasn't able to catch a lot of the retailer resets that occur in the early -- late summer, early fall time period. So we anticipate that things will start to pick up this year, and we'll also be ramping up our promotional activities as well. Simona Jankowski - Goldman Sachs Group Inc., Research Division: Great. And then, just on the Aviation segment, you seem to be assuming some modest deceleration for this year? Is there anything in particular driving that? I would have thought that based on your pipeline of wins, the growth rate there should remain pretty constant, if not accelerate. Clifton A. Pemble: Well, I think we probably had higher than our expectations in 2014. So we feel like the aviation market still faces some challenges. As we mentioned, we expect stability in the OEM market. We don't expect things to go down. We do expect our new platforms to contribute, and the aftermarket is showing some signs of modest growth. But again, we don't want to be overoptimistic about aviation, because it is very insensitive to things like government shutdowns and the economy and the various things that can happen in the course of the year. Simona Jankowski - Goldman Sachs Group Inc., Research Division: Sure. Hopefully, you don't have any more of those. Just last one on the model, can you just remind us the contribution from deferred in the quarter and then what you are embedding in your guidance for 2014? Kevin S. Rauckman: Yes. So the contribution on deferred just for Q4 was actually just about $6 million is all from a sales perspective. As we go forward, we're going to continue to see more amortizations than deferrals, so this will be from here on out as a tailwind for us and help us throughout 2014. If you look at the balance sheet, you can still see that we have quite a bit of deferrals that are sitting there that will be amortized over the next several years and help our EPS as we go forward. Simona Jankowski - Goldman Sachs Group Inc., Research Division: So kind of a $0.20 to $0.30 contribution to this year would be a reasonable range to think about? Kevin S. Rauckman: Somewhere in that range, maybe a little bit less than that.

Next, we'll go to John Bright with Avondale Partners. John F. Bright - Avondale Partners, LLC, Research Division: Congrats and, as well, Kevin, good luck, sir. I'll dig into the same questions -- or a couple of the same questions. In Outdoor, can you talk about some of the underlying assumptions behind the 10% to 15% outlook beyond the VIRB product, specifically in the golf and the pet mark -- technologies, how you plan to gain market share? Kevin S. Rauckman: Well, John, as I mentioned in my remarks, we do expect continued growth in the golf market. That's been a market that has continued to show expansion as we've come out with new products and innovation there. The dog tracking and training market is an area that we can see additional growth in the coming year and then, of course, the contribution from action cameras. The other product segments in Outdoor tend to be mature and are either stable or in a slight decline type of a mode, according to our assumptions. So there's some offsets going on. John F. Bright - Avondale Partners, LLC, Research Division: And then in Aviation, I think in your prepared remarks, you talked about G3000 and 5000 market share opportunities there -- upcoming opportunities? Can you expand on those? Kevin S. Rauckman: Yes. We have delivered, of course, at the end of the year, certifications for Sovereign and M2 and the Lear 70 and 75. So we'll see a full year contribution there. And in the upcoming year, the Citation X should be moving toward certification, so that will also contribute.

We'll go to the next caller, that is Mark Sue with RBC Capital Markets. Mark Sue - RBC Capital Markets, LLC, Research Division: Kevin, thanks for all the help throughout the years. I guess if I look at the Outdoor Fitness market, the investor concern has always been that there's a lot of competitors. It's a market defined by declining ASPs. If anything, you're gaining share and actually you're seeing an ASP lift. Do you think of the business from a unit growth and then an ASP point of view? Or is it really rather contribution margin and cash flow to the business? Just kind of -- I think there's so many subsegmentations of the market. We're just trying to see which direction you might move into and the underlying financial reasons why. Kevin S. Rauckman: So I think we still expect unit growth, clearly, within both of those segments. ASPs, as you point out, are -- really, we don't see much of a price issue at all. I think we have maybe in the Fitness side, lost a little bit on the very low end of the market. But if you look at our overall ASP, because of the product mix and the new products that we're bringing out, for example, the VIRB having a little bit higher price point, that's going to let things rise, not only increased units, but also increased ASPs. So much of what we would look at on an ASP in those segments just have to do with new products rollout and the contribution from those products. Mark Sue - RBC Capital Markets, LLC, Research Division: Okay, that's helpful. Kevin S. Rauckman: Did I answer your question? Mark Sue - RBC Capital Markets, LLC, Research Division: I think so. Is there a floor to kind of where -- how low your prices will go for some of your products? I just think back to the days when we saw a bunch of PNDs and bins at Best Buy and trying to see, I mean, if those days are way behind us in terms of how low prices will go for some of the Outdoor and Fitness products. Clifton A. Pemble: Well, I think, Mark, you're combining Outdoor and Fitness, which probably have different dynamics in each one of those markets. In the Outdoor segment, we would anticipate that it's a very mature market for the most part and with the exception, of course, new and emerging opportunities like Fitness or VIRB action cameras. But we would anticipate stable to increasing ASPs there. In Fitness, the market has trended down in ASP, driven by the introduction of lower-end products like our Forerunner 10. But even with that, we're selling the Forerunner 10 at a premium compared to the market, and we have not been in the mode in our business of just competing on price. We always compete on value, performance, innovation, utility and differentiation. So that's basically our outlook on those 2 markets. Mark Sue - RBC Capital Markets, LLC, Research Division: And, Kevin, one last thing on Marine. I guess there's a lot of new products and you would need to -- that you might need to get out there into the marketplace. The -- on Marine, would it require additional R&D? Or is that mostly behind us? So it's really about getting products out the door at this stage? Kevin S. Rauckman: Yes. I think we've ramped up our team there over the last year. And as Cliff mentioned, we made some changes structurally, but we feel like we have a pretty solid Marine R&D team right now. So most of the increase that we would expect in 2014 on the R&D line would actually come from some of the other segments like Aviation, Outdoor and Fitness.

Now we'll go to Andrew Spinola with Wells Fargo. Andrew Spinola - Wells Fargo Securities, LLC, Research Division: I had a question about the VIRB launch. I guess I thought you might ramp up advertising spending in support of that launch in Q4. It didn't seem to happen from what I saw in the results. And then, your comment about 2014 is that ad spending should sort of move with revenue. And so I'm assuming aggregate revenue is going to be flattish, then your ad spending might be flattish. So what's your thinking around advertising to support that product and the vívofit, and what's necessary? Clifton A. Pemble: Yes. Thanks, Andrew. I think as we've mentioned before, we launched the VIRB late in the year, and we missed opportunities to be able to catch resets that occurred earlier in the year. So we knew that distribution was not optimal, and we also had constrained production as we ramped up a totally new category for Garmin, which includes complex optics and new processes that were developed for our company. So we knew that we had just a limited amount of product and it didn't make a lot of sense to go out too strong in Q4. That said, as we've mentioned, we plan to increase our activity on promotion for VIRB in the coming year. And as I mentioned in my remarks, we're going to scale our advertising based on both revenue and opportunity. So in this case, VIRB is an opportunity, and we will be investing to promote that product in the coming year. And similar things apply for the vívofit. It's a new category. We're already shipping the product, and we believe we have good retail placement for the product early in the year, so we're excited about that. But we're also going to be increasing our promotion of that as the year goes forward. Andrew Spinola - Wells Fargo Securities, LLC, Research Division: It makes sense. And then, in Auto, I guess that's the one segment where your outlook is maybe better than I was thinking. And if I think about the sort of low end there, that down 10% in Auto, I guess TomTom made some comments that maybe they think the PND market is going to continue to decline at the same magnitude but a little bit better than previously. What would it take to get you to that 10% with PNDs, new products, OEM, what are you thinking? Kevin S. Rauckman: Well, I think, without a doubt, the Auto/Mobile includes Mobile, Auto OEM revenue and also PND revenue. That 10% to 15% actually includes a little bit deeper decline on PND specifically. But I think to your points, we've seen a little bit better strength in the European market, so it's declined slower. And we'll just have to see how that shakes out as we go through 2014. But I think we were assuming at a 10% level PND would be down maybe closer to 15% on revenue for the year.

Let's go to Paul Coster with JPMorgan. Paul Coster - JP Morgan Chase & Co, Research Division: The impression I get is that the number of products and categories that you announced [indiscernible] is increasing. I wonder if you can talk a little bit about the overall product strategy, maybe excluding Aviation, Marine, and how you think about your role in these categories. Are you sort of a pioneer or a fast follower? But also, how do you manage this overall portfolio? What is going to be the sort of strategy for introducing products, refreshing them, and then retiring them? And what I'm trying to get to here is the implications for R&D and also what the R&D might lead to in terms of future proliferation of products. Clifton A. Pemble: Well, Paul, I think in terms of how we view these various segments, including Aviation, Marine is that we're constantly looking for new areas where we can create new product categories, new niches in the market or new bolt-on adjacent market areas as we've done in every market segment. We're not in a mode of trying to trim back or figure out ways we can cut some of our product lines because we feel like there's opportunities everywhere across the business. And so, for R&D, what we will do is we'll continue to invest in developing and finding these niche and adjacent categories, as well as to keep our core product lines fresh, which is important because it keeps buyers interested in the market and we bring new innovations to those product lines. Paul Coster - JP Morgan Chase & Co, Research Division: So the rate of innovation is accelerating in some areas particularly around health products. Does this mean that we should expect more releases from you every sort of -- the cycle time is basically reducing? Clifton A. Pemble: Yes. I think recently, we've been performing well in terms of our product releases. As I mentioned in my remarks, we introduced an entire new line -- 47 new Marine products late last year. Those have already been delivered to the market. We introduced our vívofit and vívokí at CES. That is already shipping. So we believe that in many areas of our business, we're performing well. And many of our product releases that we'll have in 2014 have already been delivered to the market in Q1. And so that represents more than half of what we anticipate doing in the coming year.

And now we go to Jonathan Ho with William Blair. Jonathan Ho - William Blair & Company L.L.C., Research Division: Best wishes to you, Kevin, as well. Just wanted to start out with sort of your expectations around M&A and what you guys are thinking about just given sort of your balance sheet position, whether anything has changed in terms of your overall M&A outlook. Kevin S. Rauckman: Well, no real changes to the M&A. I think you, Jonathan, you know us well. We have been selective in our -- in the companies that we've acquired, and we've acquired several over the years, actually dozens over the years, and we're still looking for other opportunities, but we're also not going to be overly aggressive. But the fact of the matter is we have good flexibility there. We are always evaluating businesses. I would still say that the sweet spot for us still remains the smaller to medium-sized businesses that are easier to integrate as opposed to going out and doing a life-changing type of an acquisition. So it is a part of our strategy, and it's one of the 4 uses of our cash that we intend to capitalize on. Jonathan Ho - William Blair & Company L.L.C., Research Division: Got it. And you guys referenced a couple of times sort of challenges around ramping production around VIRB, it being sort of a new product category. How do you guys feel about your production capacity today? I mean, do you feel like you have sort of the right processes in place? Do you have the ability to sort of meet the demand in the marketplace and sort of scale to the level that's needed for some of these mass-market broad line retailers? Clifton A. Pemble: Yes, Jonathan. We don't have any concern at all about our capacity. In fact, we've got quite a bit of excess capacity that we could ramp up pretty quickly if we need to. I think our comments around spinning out products especially relates when we have a new technology like VIRB, which introduces things like optics into our production line that we haven't been doing on a significant scale in the past. So it takes some time to do that, but those issues are basically behind us, and we don't have any concern over the capacity and our ability to support retailers.

[Operator Instructions] Next, we'll go to Tavis McCourt with Raymond James. Tavis C. McCourt - Raymond James & Associates, Inc., Research Division: Kevin, congratulations. So in terms of 2014, 2 questions on the outlook. One, given kind of some new products in the categories here, should we be anticipating anything different from a seasonality standpoint than we typically see either in the business in aggregate or in certain product categories? And then, secondly, if I look at kind of the overall operating margins guided to be down a couple of hundred bps year-over-year, but gross margins up quite nicely, you indicated Aviation to be kind of flat to up operating margins. Where is that margin decline going to be most pronounced, which segment? And I guess that's it. Kevin S. Rauckman: Yes. So first of all, Tavis, seasonality. We don't see much change in the seasonality within our business. I mean, business as usual as we go forward with the new products and the continuing products. From an operating margin standpoint, it is really an investment in -- primarily in R&D, so as I mentioned, Aviation. So we hope that the sales growth rate meets or exceeds the R&D growth rate there from an operating margin standpoint. But the other segments, Outdoor, Fitness and even Auto/Mobile, I think, we're still evaluating what that looks like in the future. But the other areas of R&D growth, as I mentioned, were Outdoor and Fitness, but that's going to be a little bit of a decline on those segments. And the other thing is product mix. So VIRB, for example, is a lower-margin product than our average Outdoor gross margin. So there's just going to be some natural product mix that influences the operating margins within segments like Outdoor and Fitness. Tavis C. McCourt - Raymond James & Associates, Inc., Research Division: And if I can ask a follow-up on the Auto OEM business. What should our expectations, or what are your expectations of kind of full-blown infotainment business at this point? And how long are you willing to support that effort without meaningful progress there versus just making this more of an application-type business like you have with Mercedes? Clifton A. Pemble: Well, Tavis, I think as we mentioned in the past, we realize that progress in the Auto OEM business is -- takes place at a very slow rate. We do have some foothold in the infotainment business in some smaller OEMs and aftermarket, but developing bigger opportunities does take time. So we're still working on developing more of those opportunities, and we continue to be patient. We also are managing that investment as best as we can to make sure that it's scaled towards the opportunities that we see.

Now we'll take a question from Ben Bollin with Cleveland Research. Benjamin James Bollin - Cleveland Research Company: Kevin, congrats. Good luck on what lies ahead. I wanted to -- first, you mentioned margin implications for VIRB. Could you talk to the margin implications for the vívo products as those come to market? And could you also talk a little bit about when you look at VIRB and the vívo products, how do you view your offerings and kind of the differentiation versus competitors? And then, I have a follow-up. Kevin S. Rauckman: Well, I think, Ben, in terms of margin on the vívo, we would -- I believe that margin structure is very similar to our entry-level Fitness watches today. So we don't think that there's any significant change in terms of the margin profile of the product. As that product of course delivers and increases in mix, then it could bring down our Fitness margins slightly as it increases its contribution. And your second question on VIRB, please? Benjamin James Bollin - Cleveland Research Company: When you look at VIRB and vívo, those 2 kind of new market entrants for you, how do you view those offerings as being differentiated versus competitors? What are your kind of strongest attributes versus incumbents in those markets? Clifton A. Pemble: Well, we believe both of those products are highly differentiated versus competitors. If you start with the vívo and look at what we brought to the market there, we have an industry-leading battery life of 1 year, and we have a very friendly readable LCD display. And this product is expandable, so you can add your heart rate later if you increase your level of fitness. It has intuitive innovative features such as motivational features that allow people to increase their level of fitness over time as they start to see progress. And finally, the web side of it can be underestimated in terms of the impact there. We have a very well-developed web presence with Garmin Connect, and with the new launch of the updated website, it's tailored now to all kinds of users from basic entry in the fitness area with vívo to the high-end users on the running watches. So in terms of VIRB, our main differentiation there has been bringing sensor integration and integration with other Garmin products through the market. We have GPS capabilities with accelerometers, and all that information can be overlaid onto your video, including information from heart rate monitors and our other fitness products. And so, we offer a level of integration into the market that it previously didn't have. Benjamin James Bollin - Cleveland Research Company: Okay. And one other question, when you look at our working capital, do you have any thoughts, longer term, about where that goes? Are you comfortable with the level of working capital as it stands today. Would you like to reduce that level and improve cash flow? What are your thoughts on working capital? Clifton A. Pemble: I think we're fairly comfortable with our working capital management. There's always some puts and takes there on what we can do better on -- accounts receivable and inventory, in particular. But the numbers that we shared from a free cash flow of 550 to 600 seems just modest changes year-over-year in the working capital.

We'll next go to Brad Erickson with Pacific Crest securities. Brad Erickson - Pacific Crest Securities, Inc., Research Division: Just a couple of follow-ups. First, in terms of the Q4 Fitness growth, can you kind of rank order the drivers of growth in that segment between the new watches, Vector and then Edge, and then kind of how we should be thinking about those within the Fitness outlook for 2014, along with the vívo products? Clifton A. Pemble: Yes, Brad, I think that all the things you mentioned were strong contributors to our Q4 performance. There was a lot of pent-up demand for the new running watches, and Vector and byproducts certainly also contributed to the mix as well. In terms of 2014, we see those dynamics continuing. The Forerunner 620 and 220 redefines the high-end running watch market, and with the running dynamics features. And we see that product being very popular in the coming year. We'll have a full year of Vector as well, and then of course vívofit is all new revenue for us. Brad Erickson - Pacific Crest Securities, Inc., Research Division: Great. And then, in terms of the VIRB product so far, you obviously made some comments around intentions to ramp up advertising, et cetera. Given you're, obviously, a very strong competitor in that category, from kind of more of a point-of-sale perspective, can you talk about what needs to happen in order to improve demand, which it seems like you've been implying has been a bit soft so far? Clifton A. Pemble: The point-of-sale, as you point out, is really critical, and so we're working hard to get point-of-sale presence, an improved presence where we have it today. And many retailers of course are looking for our -- evidence of our promotions as well. And so as we ramp those up in -- starting here, in March, they'll start to see more demand driven from the customer side as well.

And we'll take our final question from Jeremy David with Citi. Jeremy David - Citigroup Inc, Research Division: My first question is about Garmin Connect. It looks like the growth of miles logged is moderating. It took about 170 days to get from 3 billion miles to 4 billion miles last year, implying about 6 million miles logged every day. And as of yesterday, 4.57 billion miles were logged, implying just about 4 million miles logged on average every day since Garmin Connect with 4 billion miles logged in that September 2014, so a deceleration from about 6 million miles logged last summer to about 4 million miles a day now. Is that seasonality? I don't think we've seen it before. Or is it a sign that the user engagement on the Garmin Connect platform is declining? And maybe you could tie that up with the changes you're making to that platform. Clifton A. Pemble: Well, Jeremy, I think that seasonality definitely is something to consider. It is winter, and a very cold one in many parts of the country, and I have not been able to get out and run as much as I like. So I would anticipate, as summer and spring come to us, that you'll see an acceleration there. Jeremy David - Citigroup Inc, Research Division: Okay. Can you comment on the changes you're making to the platform to make it more social? Clifton A. Pemble: Yes. That's been an ongoing process where, last year, we introduced groups and ways for people to be able to share their activities with members of their groups. This year, we're focusing on things like leader boards and challenges which will help enhance the ability for people to engage with the site. Jeremy David - Citigroup Inc, Research Division: Okay. As a follow-up, you still -- you've only used $59 million of your $300 million buyback authorization. I believe it's expiring at the end of this year. So should we expect to see you complete the buyback by the end of 2014? Would you consider extending it? Or would you consider letting it expire unused? Kevin S. Rauckman: Well, I think, implied in our guidance, we assume that we are going to continue to be in the market consistently after we get out of the blackout period here in a couple of days. So of course, it depends on price and how aggressive we will be. But at this point, we plan to be more aggressive as we go through 2014. I can't say if we're going to use it all up yet, but it's not our intention to let it expire. Clifton A. Pemble: All right. I think that concludes our call for today, so thanks, everyone, for participating. And we'll talk to you next quarter.

And that does conclude today's conference. We thank everyone, again, for their participation.