Refile: TomTom sees location tech sales at low end of guidance as weak auto demand weighs
11/10/2024 06:51
(Refiles to correct dateline with no changes to text)
By Mathias de Rozario
Oct 11 (Reuters) - Digital mapping specialist TomTom
TOM2.AS expects annual sales of its location technology unit
to come at the lower end of its guidance range of 490-520
million euros ($536-569 million), it said on Friday after weak
demand for new cars hit its third-quarter revenue.
It reiterated the group-level outlook for 2024 revenue at
the low end of its 570-610 million euro range.
WHY IT'S IMPORTANT
A slowdown in global auto demand has impacted TomTom, which
makes a bulk of its sales from location technology applications
for cars. In July, it suspended its 2025 targets and trimmed its
revenue expectations for 2024 because of this.
The group, whose shares have lost more than a fifth of their
value since the start of the year, has been investing in its new
mapping platform, TomTom Orbis, to try to compensate for the
steady decline in its consumer division sales by growing the
location technology business, including automotive.
CONTEXT
The automotive market has continued to deteriorate since TomTom
reported its last quarterly results, with a 18.3% drop in new
car sales in the European Union in August to their lowest level
in three years.
The location data pioneer, which started by providing a
navigational tool for turn-by-turn directions, is now developing
high definition self-driving maps that integrate consumer data
and advanced driver assistance systems.
BY THE NUMBERS
TomTom's revenue fell to 140.7 million euros in the third
quarter, missing analysts' consensus of 142 million, weighed
down by declines in the automotive and consumer divisions.
Its loss before interest and tax narrowed to 4.1 million
euros in the quarter from a loss of 8.7 million a year earlier,
smaller than the loss of 5 million euros seen in the
company-provided consensus.
($1 = 0.9146 euros)
(Reporting by Mathias de Rozario in Gdansk; editing by Milla
Nissi)
((mathias.derozario@thomsonreuters.com))