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TomTom Q2 net profit jumps on strong automotive business growth

TomTom reported a five-fold increase in quarterly net profit on Tuesday, helped by its fast-growing automotive business and a strategic shift towards high-margin recurring content and services business.

The Dutch navigation systems company reported a net profit of 12.2 million euros ($13.5 million) for the April-June quarter. Adjusted net profit rose 87 percent on year to 23.2 million euros, while revenue was stable at 265.2 million euros.

Revenue from its automotive business jumped 34 percent to 34.9 million euros.

"Our gross margin continued to strengthen, as we are reducing our dependency on hardware products by growing recurring content and services business," Chief Executive Harold Goddijn said in a statement.

Analysts polled by Reuters expected an adjusted net profit of 12.6 million euros on a revenue of 267 million euros.

TomTom Car Kit for Apple iPhone.
Jesse Wild | Tap Magazine | Getty Images
TomTom Car Kit for Apple iPhone.

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