If you are seeing incorrect speed in the performance display, first confirm that your wheel circumference is set correctly for the sensor you are connected to.
If the circumference is set correctly and you have the sensor attached to a wheel with a dynamo hub it is likely the dynamo is the problem. The Speed Sensor is generally not compatible with dynamo hubs. The sensor uses a magnetometer to detect rotation and the magnetic fields generated by a hub dynamo interfere with this sensor.
More details on how the sensor operates can be found on Garmin's support center.