By Federica Mileo and Augustin Turpin
(Reuters) – Dutch navigation and digital mapping company TomTom on Friday raised its 2022 outlook, as increased car production and higher location technology sales drove third-quarter results.
The Amsterdam-based group, whose customers range from major car companies to leading global tech firms, forecast full-year revenue of 505-520 million euros ($494-509 million), including 410-425 million euros from its core location technology business.
It had previously guided for a revenue of 470-510 million euros, with 380-420 million euros generated from location technology.
The company, whose clients include Volkswagen, Renault and Microsoft, has been hit by the global chip shortage that has disrupted the automotive and electronics industries, as well as high cost inflation.
“Macroeconomic uncertainties and inflationary pressures have an impact on global car production as well as our cost levels,” finance chief Taco Titulaer said in a statement.
Still, quarterly sales were boosted by increased car production volumes in TomTom’s core markets, the company said.
The location technology business, which provides maps, traffic information and navigation software to carmakers, governments and tech firms, increased its third-quarter revenue by 14% to 108.3 million euros, above analysts’ average estimate of 101 million euros.
The group’s total revenue came in at 136.3 million euros, beating analysts’ 126-million-euro estimate.
TomTom expects 2022 free cash outflow to be around 2% of the revenue, excluding the restructuring of its Maps unit, against 5% outflow in its previous guidance.
It reiterated its revenue forecast for 2023, but lowered free cash flow guidance from at least 5% to break-even.
($1 = 1.0221 euros)
(Reporting by Federica Mileo and Augustin Turpin in Gdansk; editing by Milla Nissi)
