TomTom, the Dutch navigation device maker, cut its 2008 revenue outlook and warned price cuts would hit first quarter sales and profits. The maker of portable navigation devices (PNDs) for cars and mapping software for handheld computers said quarterly sales would fall year-on-year for the first time since the company went public in 2005.
TomTom now expects Q1 sales of 260 million to 270 million ($409 mm to $425 mm), well below an average forecast of 347 million ($545 mm) from analysts polled by Reuters. Revenue in the year-ago quarter was 296 million ($464 mm).
For the full year, TomTom lowered its forecast, but held steady on its unit and gross margin guidance. It now expects to achieve revenue of between 1.8 billion and 2 billion ($2.8 bn to $3.1 bn), down from its estimate of 2 billion to 2.2 billion ($3.1 bn to $3.4 bn) given Feb. 21. It expects to sell between 14 million and 15 million PNDs and to achieve a gross margin and operating margin of close to 40% and 20% respectively.
