TomTom says ramp-down of old contracts will weigh on 2026 sales, shares tumble

By Mathias de Rozario Feb 4 (Reuters) – Dutch mapping technology group TomTom expects its revenue to be lower or at most steady in 2026, as a shift between old and new contracts will have a negative effect before starting to drive growth in later years, it said on Wednesday. The group forecast revenue of between 495 million and 555 million euros ($586 million and $657 million) for 2026. Last year, its revenue fell 3% to 555 million euros, missing analysts' 561-million-euro forecast in a company-compiled consensus. The weak results and downbeat outlook sent TomTom's shares falling more than 10% in early trading in Amsterdam. "We see a ramp down of some old contracts, a ramp up of new contracts, but that transition is a bit wobbly, so we go through a slight decline in 2026. We will recover that in 2027, and then in 2028, we will see the effects of the new contracts materializing," TomTom's co-founder and CEO Harold Goddijn told Reuters. Within the automotive business, where the contract transition is mainly focused, order backlog increased to a record 2.4 billion euros by the end of 2025.  TomTom also secured several contracts ahead of the 2026 CES trade show, held in Las Vegas last month and dominated by artificial intelligence. Those deals included an AI voice interaction partnership with Amazon Alexa, an expanded cooperation with Uber , and a contract with Volkswagen’s software unit CARIAD for its advanced driver-assisted system-level map. The group expects revenue in its core Location Technology business to be between 435 million and 485 million euros in 2026, compared to 482 million last year, and its operating margin to grow from 0% to above 3%. Despite a decline in revenue, the group's annual operating profit turned positive at 1.6 million euros, slightly below the 2 million euros expected by analysts. "We've gone through a very big overall technology stack, and we came to the end of that in 2025. That allowed us to really optimize the business for efficiency and productivity," Goddijn said. ($1 = 0.8451 euros) (Reporting by Mathias de Rozario in Gdansk, editing by Milla Nissi-Prussak)

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