Garmin 2005 Annual Report Download - page 47

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Our sales are subject to some seasonal fluctuation. Typically, sales of our consumer products are highest in
the second quarter, due to increased demand during the spring and summer marine season, and in the fourth quarter,
due to increased demand during the holiday buying season. Sales of consumer products are also influenced by the
timing of the release of new products. Our aviation products do not experience much seasonal variation, but are
more influenced by the timing of the release of new products when the initial demand is typically the strongest.
Backlog
Our sales are generally of a consumer nature and there is a relatively short cycle between order and
shipment. Therefore, we believe that backlog information is not material to the understanding of our business. We
typically ship most orders within 72 hours of receipt.
Intellectual Property
Our success and ability to compete is dependent in part on our proprietary technology. We rely on a
combination of patent, copyright, trademark and trade secret laws, as well as confidentiality agreements, to establish
and protect our proprietary rights. As of March 1, 2006, we held 254 U.S. patents that expire at various dates no
earlier than 2009. As of March 1, 2006, Garmin had 160 U.S. patent applications pending. Garmin also holds 4
foreign patents and has 11 foreign patent applications pending. In addition, Garmin often relies on licenses of
intellectual property for use in its business. For example, Garmin obtains licenses for digital cartography technology
for use in our products from various sources. Our registered U.S. trademarks include: GARMIN, BLUECHART,
CITY SELECT, DCG, ETREX, ETREX CAMO, ETREX LEGEND, ETREX SUMMIT, ETREX VENTURE,
ETREX VISTA, FORERUNNER, GNC, GPSMAP, IQUE, MAPSOURCE, METROGUIDE, PERSONAL
NAVIGATOR, QUEST, RINO, SEE-THRU, STREETPILOT, and TRACBACK Our mark GARMIN and certain of
our other trademarks have also been registered in selected foreign countries. Garmin’s trademarks include EDGE,
FORETREX, GARMIN MOBILE, G1000, GEKO, MOTIONBASED, NROUTE, NÜVI, PERSONAL TRAVEL
ASSISTANT, QUE and ULTRASCROLL. Some of Garmin’s patents and its registered trademarks and trademarks
are owned by Garmin’s subsidiaries, Garmin Corporation, Garmin International, Inc. and Garmin AT, Inc.
We believe that our continued success depends on the intellectual skills of our employees and their ability to
continue to innovate. Garmin will continue to file and prosecute patent applications when appropriate to attempt to
protect Garmin’s rights in its proprietary technologies.
There is no assurance that Garmin’s current patents, or patents which we may later acquire, may
successfully withstand any challenge, in whole or in part. It is also possible that any patent issued to Garmin may
not provide us with any competitive advantages, or that the patents of others will preclude Garmin from
manufacturing and marketing certain products. Despite Garmin’s efforts to protect its proprietary rights,
unauthorized parties may attempt to copy aspects of Garmin’s products or to obtain and use information that Garmin
regards as proprietary. Litigation may be necessary in the future to enforce Garmin’s intellectual property rights, to
protect its trade secrets, to determine the validity and scope of the proprietary rights of others or to defend against
claims of infringement or invalidity.