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TomTom (NL:TOM2)
:TOM2
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TomTom (TOM2) AI Stock Analysis

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NL:TOM2

TomTom

(OTC:TOM2)

Rating:54Neutral
Price Target:
€5.50
▲(3.00% Upside)
TomTom's overall stock score reflects a company with strong cash flow improvements and positive technical indicators, but facing significant profitability challenges and valuation concerns. The upgraded financial outlook and strategic realignment are positive, yet declines in key revenue segments and restructuring costs weigh on the score.

TomTom (TOM2) vs. iShares MSCI Netherlands ETF (EWN)

TomTom Business Overview & Revenue Model

Company DescriptionTomTom (TOM2) is a global leader in location technology, specializing in providing navigation and mapping products and services. Founded in 1991 and headquartered in Amsterdam, the company operates across various sectors, including automotive, consumer electronics, and enterprise solutions. TomTom's core offerings encompass GPS navigation devices, real-time traffic information, mapping software, and location-based services, which are essential for both personal and commercial usage.
How the Company Makes MoneyTomTom generates revenue through multiple streams, primarily by providing navigation and mapping solutions to automotive manufacturers, which integrate TomTom's technology into vehicles. This includes licensing their maps and traffic data to companies in the automotive sector, resulting in significant recurring revenue. Additionally, TomTom earns income from its consumer products, such as portable GPS devices and smartphone applications. The company also offers location-based services and APIs for businesses, contributing to its earnings. Strategic partnerships with major companies in technology and automotive industries further bolster its revenue capabilities, allowing for collaborative development and distribution of innovative location services.

TomTom Earnings Call Summary

Earnings Call Date:Jul 15, 2025
(Q2-2025)
|
% Change Since: |
Next Earnings Date:Oct 14, 2025
Earnings Call Sentiment Neutral
The earnings call presented a mixed picture with significant highlights such as improved cash flow, gross margins, and an upgraded financial outlook. However, these were offset by declines in group revenue, automotive, and enterprise segments, alongside restructuring costs.
Q2-2025 Updates
Positive Updates
Realignment and Cost Efficiency
TomTom has announced a realignment of its organization, reducing around 300 roles to increase agility and sharpen focus, expecting annualized savings up to EUR 35 million.
Increased Free Cash Flow
Free cash flow improved significantly to EUR 14 million in the second quarter, a sharp improvement from an outflow of EUR 5 million last year.
Strong Gross Margin
Gross margin increased to 88% in the second quarter, up from 80% last year, indicating improved cost efficiency and profitability.
Upgraded Financial Outlook
TomTom raised its full-year group revenue guidance to between EUR 535 million and EUR 565 million and expects free cash flow to be around 5% of group revenue at the midpoint.
Negative Updates
Decline in Group Revenue
Group revenue for the second quarter was EUR 146 million, down from EUR 152 million in the same period last year.
Decrease in Automotive Revenue
Automotive operational revenue saw a year-on-year decrease of 13% to EUR 77 million due to lower car volumes and the ramp down of some car lines.
Enterprise Revenue Decline
Enterprise revenue declined by 4% compared to the same period last year, largely due to the contribution from the Australian government contract in Q2 last year and a weakening U.S. dollar.
Consumer Revenue Fall
Consumer revenue declined by 15% year-on-year to EUR 20 million, continuing a downward trend in this segment.
Restructuring Costs
The second quarter included a EUR 25 million restructuring provision related to organizational realignment, impacting operating expenses.
Company Guidance
In the recent conference call, TomTom provided updated guidance reflecting a positive outlook for the remainder of the fiscal year. Despite some short-term challenges, the company's first-half performance exceeded initial expectations, prompting an upgrade in their full-year group revenue forecast to a range of EUR 535 million to EUR 565 million. The Location Technology revenue is expected to range between EUR 465 million and EUR 490 million. TomTom also raised its free cash flow guidance to approximately 5% of group revenue at the midpoint of the guided range. The restructuring efforts, expected to yield annualized savings of up to EUR 35 million, and a strong cash position of EUR 267 million at the end of the second quarter support the company's transition to a product-led operating model. This strategic shift is anticipated to enhance operational efficiency and position TomTom for long-term success.

TomTom Financial Statement Overview

Summary
TomTom's financial performance shows mixed results. The company has a strong gross profit margin of 87.37%, indicating efficient cost management. However, the negative net profit margin and revenue growth highlight ongoing profitability challenges. Improvements in cash flow management are a positive sign, but the negative return on equity suggests inefficiencies.
Income Statement
45
Neutral
TomTom's income statement shows a mixed performance. The company has a strong gross profit margin of 87.37% TTM, indicating efficient cost management. However, the net profit margin is negative at -5.39% TTM, reflecting ongoing losses. Revenue growth is also negative at -1.04% TTM, suggesting challenges in expanding sales. The EBIT and EBITDA margins are low, with EBIT being negative, highlighting profitability issues.
Balance Sheet
50
Neutral
The balance sheet indicates moderate leverage with a debt-to-equity ratio of 0.34 TTM, which is manageable. However, the return on equity is negative at -22.65% TTM, pointing to inefficiencies in generating returns for shareholders. The equity ratio is not explicitly calculated, but the company's equity position appears stable relative to its assets.
Cash Flow
60
Neutral
Cash flow analysis reveals a significant improvement in free cash flow growth at 185.74% TTM, indicating better cash management. The operating cash flow to net income ratio is 0.17 TTM, suggesting that operating activities are generating cash despite net losses. The free cash flow to net income ratio is 0.69 TTM, showing a positive cash flow relative to net income.
BreakdownTTMDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue569.52M574.38M584.76M536.34M506.93M528.18M
Gross Profit497.60M487.51M495.77M449.72M407.11M423.39M
EBITDA27.63M25.87M31.56M-36.94M-11.47M-7.45M
Net Income-30.72M-17.29M-21.01M-102.73M-94.65M-257.64M
Balance Sheet
Total Assets705.55M724.42M795.89M807.50M890.74M978.02M
Cash, Cash Equivalents and Short-Term Investments266.53M263.65M315.19M303.73M355.82M372.45M
Total Debt41.10M43.52M46.71M37.73M33.34M43.67M
Total Liabilities585.85M585.57M614.30M607.90M608.02M590.40M
Stockholders Equity119.70M138.85M181.59M199.61M282.72M387.62M
Cash Flow
Free Cash Flow28.53M-4.22M20.84M-41.57M23.51M-26.48M
Operating Cash Flow41.50M1.35M32.70M-31.41M36.78M-20.18M
Investing Cash Flow-27.59M14.35M-53.55M-30.77M-19.98M73.51M
Financing Cash Flow-9.49M-47.89M-23.46M-10.32M-43.66M-29.68M

TomTom Technical Analysis

Technical Analysis Sentiment
Positive
Last Price5.34
Price Trends
50DMA
5.14
Positive
100DMA
5.02
Positive
200DMA
5.01
Positive
Market Momentum
MACD
<0.01
Negative
RSI
61.65
Neutral
STOCH
63.11
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For NL:TOM2, the sentiment is Positive. The current price of 5.34 is above the 20-day moving average (MA) of 5.11, above the 50-day MA of 5.14, and above the 200-day MA of 5.01, indicating a bullish trend. The MACD of <0.01 indicates Negative momentum. The RSI at 61.65 is Neutral, neither overbought nor oversold. The STOCH value of 63.11 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for NL:TOM2.

TomTom Peers Comparison

Overall Rating
UnderperformOutperform
Sector (61)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
61
Neutral
$36.05B6.66-10.10%1.86%8.68%-8.81%
54
Neutral
$611.48M-23.52%-1.63%-18.80%
€46.27M11.3413.94%
€594.81M28.5829.06%3.50%
€1.43B21.947.75%
€150.61M-57.80%
47
Neutral
€196.07M
-7.94%7.30%
* Technology Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
NL:TOM2
TomTom
5.34
0.16
2.99%
GB:0E2F
Ctac NV
3.29
0.04
1.23%
GB:0NNU
Nedap N.V
91.50
35.45
63.25%
GB:0NO1
TKH Group N.V.
35.32
0.09
0.26%
DE:2DS
CM.com N.V.
4.62
-1.88
-28.92%
NL:MTRK
MotorK PLC
4.34
-1.62
-27.18%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.Date of analysis: Aug 29, 2025