Exploring Tech Stocks with Web3 Potential: Garmin and Microsoft

Key Points

• Garmin expands its outlook for growth and earnings, showcasing potential in wearable technology
• Microsoft generates substantial cash flow, fueling its ambitious growth strategies in cloud and blockchain

The stock market has demonstrated remarkable performance recently, with the S&P 500 achieving a 10% gain through early September 2025 and trading near record highs. While market uncertainties persist, seasoned investors recognize that a long-term investment approach remains the most effective strategy for potentially outperforming the market.

With this perspective in mind, let’s examine two stocks that appear poised to significantly outpace the market over the next decade: Garmin (NYSE: GRMN) and Microsoft (NASDAQ: MSFT).

Garmin: Navigating the Future of Wearable Tech

Garmin recently announced an impressive quarter that exceeded shareholder expectations. The company’s 20% sales boost was driven by strong demand for its innovative smartwatch offerings. Notably, Garmin achieved double-digit growth across all product categories, including its outdoor division featuring adventure watches and the aviation segment serving aircraft owners.

This broad-based success highlights Garmin’s diversified business model and its transferable strengths in research and development, marketing, and product design. These capabilities position Garmin well for potential expansion into Web3-enabled wearables and decentralized fitness tracking applications.

Garmin’s profitability has kept pace with its growth. Operating income for the first half of 2025 surged nearly 30% to $800 million, elevating the profit margin to 24% of sales from 22% in the previous year. Management has raised its outlook for both earnings and revenue, projecting sales to exceed $7 billion in 2025.

Despite trading near all-time highs, Garmin’s valuation remains attractive. The stock currently trades at a price-to-earnings (P/E) ratio of 29, down from 32 in January. This compares favorably to Apple, which trades at a P/E of 36 while being only marginally more profitable. For investors seeking exposure to both traditional tech and potential Web3 applications in wearable technology, Garmin presents a compelling opportunity.

Microsoft: Bridging Traditional Tech and Web3 Innovation

Microsoft’s $3.7 trillion market capitalization should not deter investors from recognizing its continued growth potential. The tech giant reported a 15% revenue increase in the past fiscal year, with earnings per share improving by 16% to $13.64.

Investing in Microsoft provides exposure to several multiyear tech trends, including the shift toward cloud services, rising demand for artificial intelligence (AI) enterprise software, and emerging blockchain technologies. The Azure segment alone has grown into a $75 billion annual business, with sales rising 34% in fiscal 2025. Microsoft’s blockchain initiatives within Azure position the company to potentially become a key infrastructure provider for Web3 applications and decentralized systems.

In fiscal 2025, Microsoft returned $42 billion to shareholders while heavily investing in data centers and innovations across its enterprise platform. The company’s robust cash generation - $136 billion in the past year, up from $118 billion in fiscal 2024 - enables these simultaneous investments and shareholder returns. This financial strength suggests significant potential for dividend growth over the next decade.

While Microsoft shares trade at a premium valuation of nearly 40 times earnings, this reflects both the company’s strong performance and investor enthusiasm about AI and blockchain potential. Microsoft has already demonstrated concrete financial gains from enterprise AI demand, and its diversified growth drivers provide resilience if certain tech trends underperform expectations.

For investors seeking exposure to both established tech and emerging Web3 technologies, Microsoft offers a unique combination of market dominance, innovation potential, and financial strength. As the company continues to explore blockchain applications and decentralized technologies, it may play a pivotal role in bridging traditional enterprise solutions with the Web3 ecosystem.

Both Garmin and Microsoft demonstrate strong fundamentals and positioning for future growth, including potential applications in Web3 and decentralized technologies. As the tech landscape evolves, these companies may offer investors exposure to both traditional market segments and emerging digital ecosystems.