Navteq reports strong second quarter fueled by booming PND market



Navteq reports strong second quarter fueled by booming PND market
Navteq today reported revenue and operating income for the quarter ended July 1, 2007. Revenue in the quarter rose 49% over the second quarter of 2006 to $202.3 million. Operating income was $54.0 million, compared to $33.1 million in last year's second quarter. Net income was $40.9 million, compared to $23.8 million in the prior year's second quarter.

For the first six months of 2007, revenue was $362.3 million, which represented growth of 40% over the first six months of 2006. Year-to-date operating income was $92.4 million, compared to $53.8 million for the same period in 2006. First half net income was $71.1 million, compared to $39.9 million for the same period in 2006.

Revenue from NAVTEQ's Europe, Middle East & Africa (EMEA) operations totaled $117.6 million in the quarter, up 39% from $84.7 million in the second quarter of 2006. The average U.S. dollar/euro exchange rate in the second quarter was $1.35, compared to $1.26 in the comparable period last year. Americas revenue was $81.8 million in the quarter, a 64% increase over the $49.9 million posted in the second quarter of 2006. Asia Pacific revenue, which is derived from the company's Korean subsidiary, was $2.8 million.

"Our exceptional second quarter results and strong first half performance give us great momentum as we enter the second half of the year," said Judson Green, CEO of NAVTEQ. "We are particularly excited by the surging growth we have seen in maps for portable devices and the relative stability of our automotive business despite unfavorable car sales trends in our core geographies."

Navteq’s management is revising its full-year outlook “as a result of the company's strong first half performance and better-than-expected growth trends in maps for portable devices”, said the press release. For the fiscal year 2007, NAVTEQ expects revenue of $780 million to $795 million.

Regarding map pricing trends and how they could be affected by the TomTom Tele Atlas transaction Judson Green, said: « We don’t know what impact it will have ». The overall sentiment is that this announcement was a surprise for the whole industry therefore it is too early to understand the consequences of this acquisition.

Garmin Nuvi 250
Garmin Nuvi 250
Garmin Nuvi 250
Garmin Nuvi 250
A booming PND market
In its portable device category (PNDs, PDAs and Smartphones with onboard maps) Navteq reports a growth of 118% of map units sales from 1.45 million in Q2 2006 to 3.15 million in Q2 2007 (Tele Atlas reported 3 million for the same quarter earlier today so both competitors are so far head to head). The North American business nearly tripled in this category. In the US Navteq has noticed that Garmin is well defending its 50% market share while Magellan is resurging helped by its new range of products. In Europe Navteq revenue was helped by good sales from the new Medion range as well as the entry level Garmin range Nuvi 200.

Tuesday, July 31st 2007

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