TomTom lowered its full-year revenue forecast

Article by Christian A., on November 1, 2012

TomTom has lowered its full-year revenue forecast due to declining sales of its built-in car navigation devices in Europe. In order to offset the waning popularity of personal sat-navs, Europe's largest navigation device maker and one of the top three digital map makers worldwide are attempting to boost sales of the navigation gadgets and services to carmakers.

However, the European car market was shrinking due to the debt crisis in the region. Its September sales had been dropping at their quickest pace in the last 12 months as government spending lessens the impact and unemployment worsens. Last Tuesday, TomTom said that 2012 revenue is predicted to be about 1.05 billion euros ($1.4 billion), a decline from a previous prediction of 1.10 billion euros.

In a statement last Tuesday, Chief Executive Harold Goddijn said that the European economic situation has a major impact on the automotive industry but it’s likely that Automotive revenue will continue to be under pressure in the upcoming quarters. PSA/Peugeot-Citroen, Renault and Fiat are among TomTom's customers that have experienced some of the largest decreases in auto sales in Europe.

TomTom posted a net profit in the third quarter to 22 million, standing for a 23% drop. According to SNS Securities analyst Martijn den Drijver, TomTom's car division was affected more than expected because of much lower sales at Renault and Fiat, combined with new contract extensions not yet helping revenue.

Group revenue decreased by 19% from the same period in 2011, with a 24% drop at the consumer unit and a 16% decrease at the automotive division. as As smartphones with affordable or free navigation software lower the demand for its personal navigation devices, TomTom shares fell from a record high of 56 euros in 2007 to 3.9 euros.

Goddijn chose not to offer an outlook for PNDs or for the automotive sector for 2013. He also declined to make any statement about the recent problems noted by Apple customers with regards to the quality of Apple's newest app for maps. In the PND market, TomTom competes with Garmin while it goes up against Google and Nokia in the commercial digital map market.

Topics: tomtom

If you liked the article, share on:

Comments

Recommended

Earlier this month, we learned that France has made moves to ban diesel and gasoline fueled cars by stopping them from entering the city. More than that, they plan to...
by - July 19, 2017
The new 2018 Rolls-Royce Phantom VIII is on the way, but still, all we had been seeing are camouflaged prototypes of the eight generation of this iconic nameplate. Fortunately though,...
by - July 19, 2017
Would you have ever imagined a Mercedes-Benz developing an upscale pickup? We first saw this last October as a concept car and now, the production model of the Mercedes-Benz X-Class...
by - July 19, 2017
Haven’t you ever wondered how Ferrari’s names and numbers were actually derived? As it is Ferrari’s 70th year in the industry, we believe that it’s only fair that we shed...
by - July 18, 2017
Earlier this month, we were getting hints that Hyundai, along with its sister company Genesis, isn’t doing so well in the United States as well as in Europe. So this...
by - July 18, 2017
Facebook

Youtube Channel

Tip Us
Do you have a tip for us?
Did you film an important event?
Contact us
Newsletter
Subscribe to our newsletter!
Subscribe
Galleries