TomTom: Q3 PND Share Up - Twice

TomTom: Q3 PND Share Up

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Amsterdam, The Netherlands - North American sales of portable navigation devices (PNDs) slid 27.6 percent in the third quarter to 2.1 million units and 19 percent to 6.6 million for the year-to-date, but TomTom boosted its North American market share sequentially to 25 percent from a second-quarter 21 percent, the company said in its latest financial statement.

The company first-quarter share was 25 percent.

The North American PND market slid 19 percent in the first quarter and 27.3 percent in the second quarter, the company said in previous financial statements.

TomTom also announced that, as previously planned, it began in the third quarter to restructure "to focus our organization on the areas where we see the greatest potential for growth, of which automotive [OEM] and content and services are clear examples."

The restructuring includes a workforce reduction that "will only be partially achieved through attrition," the company said.

Consumer products - mainly PNDs - accounted for 66.8 percent of TomTom's third-quarter global revenue, and revenues from sales of those products fell 23 percent to 225 million euros in the quarter following first- and second-quarter declines of 16 percent and 23 percent, respectively.

Revenues from OEM navigation-equipment sales to automakers and business, however, were up as were licensing revenues, so total company revenue fell only 10 percent in the quarter to 336.4 million euros ($465.7 million) for the quarter and down 9.8 percent for the year-to-date to 915.8 million euros ($1.27 billion). The dollar figures are based on a conversion rate of 1 euro equaling $1.38.

Despite the revenue decline, the company posted a third-quarter operating profit of 40.7 million euros ($56.3 million) and a net profit of 28.1 million euros ($38.9 million). However, because of a large second-quarter one-time impairment charge on goodwill and other intangible assets of 512 million euros ($708.8 million), the company posted a year-to-date operating loss of 435.1 million euros ($602.4 million) and a net loss of 450.7 million euros ($624 million).

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