TomTom has withdrawn its 2020 outlook as the economic impact resulting from the Covid-19 pandemic on its financial results can currently not be reliably assessed.
In its original outlook, TomTom expected group revenue to show a decline of around 5%, the Location Technology business to grow revenue by around 9% and free cash flow (FCF) was expected to be a mid to high single digit percentage of group revenue.
The impact of the COVID-19 pandemic, resulting in the closure of some automotive factories and retail channels, will cause a “deviation from this expectation” says the supplier and will lead to a decline in revenue and FCF generation compared with the original outlook for 2020.
At this point, given the uncertainty regarding the severity and duration of the pandemic’s economic impact, the specific implications on revenue and FCF for 2020 cannot be reliably assessed or quantified.
“We live in unprecedented times, as Covid-19 continues to spread globally, impacting our employees’ and customers’ everyday life and work,” said TomTom CEO, Harold Goddijn. “We have taken proactive measures to ensure continued productivity and resilience while employees work from home.
“We have full confidence structural growth drivers such as connected navigation, automated driving and Maps APIs, underpinning TomTom’s long-term strategy remain unchanged. This strategy, combined with our strong balance sheet, positions us well to deal with the current uncertainties.”
As an additional precautionary measure, TomTom has decided to suspend its share buy-back programme until further notice.