Fourth Quarter and Full Year 2023 Results
TomTom delivers growth and strong cash flow in 2023
TOMTOM’S CHIEF EXECUTIVE OFFICER, HAROLD GODDIJN
"We made good progress toward our goals in 2023, delivering revenue growth in Location Technology, improving our profitability, and bringing our new maps to market. We are excited to see growing interest from customers and prospects in TomTom Orbis Maps, which provide enhanced coverage, richness, and freshness.
From a commercial standpoint, we recorded robust order intake, culminating in a record €2.5 billion Automotive backlog. Combined with the significant and growing sales funnel we established in Enterprise there is a strong foundation for sustained revenue growth and improved profitability in the periods ahead."
OPERATIONAL SUMMARY
We joined forces with Microsoft to bring generative AI into the vehicle through the development of an AI-based conversational assistant, enabling improved interaction with infotainment, location search, and command systems
We signed a new contract with Bridgestone Mobility Solutions powering their fleet management software with our full location technology stack, including EV data and routing products
We announced a €50 million share buyback program in order to reduce our share capital
FINANCIAL SUMMARY FOURTH QUARTER 2023
Group revenue increased by 3% to €143 million (Q4 '22: €139 million)
Location Technology revenue increased by 7% to €125 million (Q4 '22: €118 million)
Automotive operational revenue increased by 1% to €83 million (Q4 '22: €82 million)
Free cash flow1 is an inflow of €5 million (Q4 '22: outflow of €15 million)
FINANCIAL SUMMARY FULL YEAR 2023
Group revenue increased by 9% to €585 million (FY '22: €536 million)
Location Technology revenue increased by 12% to €491 million (FY '22: €436 million)
Automotive operational revenue increased by 16% to €343 million (FY '22: €296 million)
Free cash flow1 is an inflow of €32 million (FY '22: outflow of €29 million)
Net cash of €315 million (FY '22: €304 million)
KEY FIGURES
(€ in millions, unless stated otherwise)
Q4 '23
Q4 '22
y.o.y. change
FY '23
FY '22
y.o.y. change
Location Technology
125.2
117.6
7%
490.7
436.4
12%
Automotive
87.8
77.1
14%
342.3
260.0
32%
Enterprise
37.4
40.5
-8%
148.4
176.4
-16%
Consumer
18.2
21.4
-15%
94.1
99.9
-6%
Revenue
143.4
139.0
3%
584.8
536.3
9%
Gross result
126.9
120.9
5%
495.8
449.7
10%
Gross margin
88%
87%
85%
84%
Operating expenses
137.2
125.4
9%
515.8
547.3
-6%
Operating result (EBIT)
-10.4
-4.5
-20.0
-97.6
Operating margin
-7%
-3%
-3%
-18%
Net result
-11.6
-8.8
-21.0
-102.7
Free cash flow1 (FCF)
5.5
-14.6
32.0
-29.2
FCF1 as a % of revenue
4%
-10%
5%
-5%
1 Free cash flow excludes restructuring payments related to the Maps realignment announced in June 2022.
TOMTOM’S CHIEF FINANCIAL OFFICER, TACO TITULAER
"Our fourth-quarter results showed a modest growth in revenues, aligning with our forecasts. We also saw a rise in operating expenses for the quarter, due to a €10 million one-off reorganization charge resulting from the further streamlining of our R&D activities.
For full year 2023, our revenues grew markedly year on year, meeting our earlier provided market guidance. Notably, our free cash flow1 saw a sharp increase as well, rising to 5% of our group revenue. Supported by these strong cash generation capabilities we initiated a €50 million share buyback program with the aim of reducing our share capital. By year-end, we had successfully completed 23% of the program.
Another considerable achievement in 2023 was the growth of our Automotive backlog, which grew to €2.5 billion. This increase can be attributed to a robust order intake, partially offset by customers’ downward revisions of near-term car production volumes.
For 2024, our projections are cautiously optimistic. We have a substantial sales funnel for TomTom Orbis Maps. Considering the typical sales cycle in the Enterprise segment, we anticipate a gradual increase in conversions to signed contracts throughout the year. We expect continued growth in our Location Technology revenue, along with an improvement in our free cash flow, based on our current strategic plans and the solidity of our business model."
Attachment
TomTom Q4 2023 results press release