April 19, 2024
Navigation firm TomTom believes auto sector sales will remain broadly flat in 2024


By Gail Sheehan and Augustin Turpin

(Reuters) – TomTom sees broadly flat sales this year as the digital mapping specialist’s auto sector customers grapple with lower demand.

However, its shares rose 7% in early trading Friday after fourth-quarter operating loss widened less than expected.

TomTom, whose customers include Volkswagen and Hyundai, was benefiting from a backlog in auto orders after prolonged supply disruptions, but that could change as inflation-weary consumers delay purchases of new cars.

“I think we need to be a little cautious of all the macroeconomic growth and car demand, which may be a little bit volatile this year,” CEO Harold Goddijn told Reuters. He also said he is optimistic about the year overall.

The Amsterdam-based company ended 2023 with a record automotive order backlog of 2.5 billion euros ($2.7 billion).

It expects revenue of 570 million to 610 million euros this year, compared with 584.8 million euros in 2023.

The midpoint of the guidance of 590 million euros is below the consensus forecast of 598 million of analysts in a company survey.

Shipping disruptions caused by terrorist attacks on container ships in the Red Sea have dealt a new blow to global supply chains, and Goddijn said this could create some challenges in 2024. However, he did not expect any major issues.

The location data pioneer, which competes with Alphabet’s Google Maps, reported a fourth-quarter loss of 10.4 million euros before interest and taxes, compared with a loss of 4.5 million a year earlier.

This includes a restructuring charge of 10 million euros to further streamline research and development activities, Chief Financial Officer Taco Titular said in a statement.

Analysts had expected a quarterly operating loss of 12 million euros.

($1 = 0.9192 euros)

(Reporting by Gail Sheehan and Augustin Turpin in Gdansk; Editing by Mila Nisi and Mark Potter)

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