Navigation service provider TomTom achieved more turnover in the second quarter than analysts had expected. The turnover forecast for this year has been raised by the company to between 570 million and 600 million euros.
TomTom benefits from increased car sales and higher production from the car manufacturers that purchase its maps and navigation services. In the company’s core markets of the United States and Europe, car sales have grown.
The question is, however, how long TomTom can still benefit from the growing sales of cars. An ING report from last Friday said that car sales are expected to weaken in the course of the year. ‘No one takes into account that the current rapid growth will continue,’ says Bökkerink. ‘We will also notice something of that.’
The competition from the navigation company currently mainly comes from companies that, like TomTom, focus on developing software and making maps, such as Here Technologies, Google and Mapbox. TomTom cut 500 jobs last year. That involved employees who manually added data to cards and that is now automated. The consequences of this are visible in the figures, says Bökkerink. ‘The underlying costs are somewhat lower as a result.’
‘We look at growth markets outside the automotive division’
Growth markets
TomTom is looking for growth markets outside the automotive division. ‘We actually look at everything where companies and people try to get stuff from one place to another as efficiently as possible.’ This fits in well with the recent launch of a navigation system especially for truck drivers, TomTom GO Expert Plus.
