Investing.com -- TomTom shares fell more than 5% on Thursday after the Dutch mapping technology company announced plans to cut about 200 jobs and lowered the midpoint of its 2026 revenue guidance, despite raising its margin outlook.
The job cuts are part of a reorganisation into three divisions, Automated Driving, Location Intelligence and Navigation, aimed at reducing management layers. Chief Executive Mike Schoofs said the changes would affect approximately 200 roles.
TomTom expects a restructuring charge of about €15 million in the fourth quarter and annualised savings of around €21 million. Third-quarter operating profit doubled from a year earlier to €6 million, beating analyst expectations.
For 2026, TomTom narrowed its revenue forecast to €505 million-€530 million from €495 million-€555 million. Consensus for the year is €525 million. It narrowed its Location Technology revenue forecast to €450 million-€470 million from €435 million-€485 million.
It raised its operating margin forecast to around 4% from around 3%. TomTom said the increase reflects stronger performance so far this year and lower salary costs expected in the fourth quarter from the reorganization.
The 4% includes the estimated €15 million restructuring charge. Excluding the one-off charge, Titulaer said, the margin would be around 7%. Consensus for 2026 operating margin is 5%.
Operating profit was €6 million, against a consensus of €3 million compiled by the company.
Chief Financial Officer Taco Titulaer said operating margin came in above the level the company had anticipated.
Operating margin was 5%, against consensus of 2%. Operating expenses were €111 million, against consensus of €116 million. Net profit was €5.1 million, against consensus of €3 million.
Revenue was €129 million, below consensus of €131 million. Titulaer said third-quarter revenue was "in line with our expectations."
Location Technology revenue was €115 million, against consensus of €116 million. Automotive revenue was €78 million, in line with consensus.
Automotive operational revenue, a measure that adjusts for movements in deferred revenue, fell 19% to €68 million from €85 million, against consensus of €77 million.
TomTom said the decline was partly driven by the phasing out of customer contracts, and that the year-earlier quarter benefited from royalty reports relating to earlier periods.
Enterprise revenue fell 4% to €37 million, against consensus of €38 million, mainly because a customer contract ended. New customer wins partly offset the drop.
Consumer revenue fell to €14 million from €19 million, against consensus of €15 million. TomTom attributed the decline primarily to lower PND revenue, reflecting the continued contraction of the PND market, as well as memory supply constraints.
Gross margin was 90%, in line with consensus. It was up from 89% a year earlier, which TomTom said reflected a larger share of higher-margin content and software revenue.
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