Tomtom’s Q1 results are sharply impacted by the COVID-19 pandemic. The Amsterdam-based navigation specialist saw its group revenue fall 23 percent to 131 million euros in the first quarter of 2020. Location revenue was 91 million euros, down 11 percent compared to Q1 of last year. Consumer revenue dropped 40 percent to 40 million. Total automotive revenue decreased to 85 million euros, as opposed to 87 million in 2019. The net result amounted to a big minus of 63 million, mainly due to higher amortization of technology and databases.
Tomtom CEO Harold Goddijn explains how the pandemic affects his company’s revenue: “Our automotive revenue arises principally from customer vehicle sales, which are sharply impacted by factory closures. Our consumer revenue is impacted by a steep decline in demand arising from retail stores being closed, retailers reducing their inventory levels and people not driving.”
Goddijn does, however, have faith Tomtom will push through despite the crisis. According to the CEO, nearly all employees can work from home, which enabled the company to sustain its engineering development activities and customer service levels. “Because of our strong debt-free balance sheet, we have the resilience to maintain our course, despite the current uncertainties. Recovery will depend on how quickly economic normality is restored, including vehicle production and end-customer demand, which is currently uncertain.”