By Toby Sterling
AMSTERDAM (Reuters) – TomTom, the Dutch navigation company, said third-quarter earnings beat expectations, helped by sales of higher margin digital mapping products.
The company, which now faces Google as a competitor, said third-quarter core earnings were 62.4 million euros ($72.2 million), compared with 35.5 million euros a year earlier.
A company-compiled consensus had seen earnings for the quarter before interest, taxes, depreciation and amortisation (EBITDA) at 41 million euros.
On Sept. 18 TomTom shares lost a quarter of their value in one day as Google announced a far-reaching supply deal with a group of carmakers including Renault, Nissan and Mitsubishi.
Analysts said that would relegate TomTom to a third place position in the mapping market.
TomTom, which this month announced plans to sell its fleet management business to focus on making digital maps used in highly automated driving — the business on which it has pinned its future — said it has seen “strong interest” for the fleet subsidiary valued at roughly 700 million euros.
CEO and co-founder Harold Goddijn said that a 36 percent increase in operating revenue and new deals with Peugeot and BMW showed the viability of the company’s products.
Group sales were fractionally higher in the third quarter at 220 million euros, from 219 million euros in the third quarter of 2017, as sales of the company’s traditional satnav devices continued to fall, offset by rising sales of digital mapping technology to carmakers, as well as to Apple and Uber[UBER.UL].
The company raised its full-year revenue outlook to 850 million euros from 825 million euros, but said that a contract announced in 2016 to provide location and navigation services to Volvo had ended.
(Reporting by Toby Sterling; Editing by Subhranshu Sahu and Louise Heavens)