TomTom, once synonymous with standalone GPS devices, is navigating a challenging transition as it cuts 300 jobs while accelerating its artificial intelligence strategy to remain competitive in the digital mapping industry.
The Amsterdam-based company, which currently employs approximately 3,700 people worldwide, announced the layoffs on Monday as part of what it describes as "realigning its organisation... as it embraces artificial intelligence." Less than half of the affected positions will be in the Netherlands, with the cuts primarily impacting employees in application development, sales, and customer support roles.
TomTom expects AI to fundamentally transform its operations, enabling more efficient scaling of product creation and delivery. "This change improves the experience and shortens innovations for our customers," said CEO Harold Goddijn in a press release. The company has been struggling financially, reporting a loss of over €14 million in 2024, and forecasts a drop in sales from €574 million in 2024 to between €505-565 million in 2025.
The strategic shift centers around TomTom's Orbis Maps platform, which leverages AI to deliver more accurate and up-to-date mapping solutions. This platform combines data from various sources, including the Overture Maps Foundation and OpenStreetMap, with TomTom's proprietary data layers, all validated through its AI-native platform. The company sees this as essential for developing technologies for autonomous driving and maintaining relevance in the navigation sector.
TomTom's consumer division has been shrinking for years as standalone navigation devices have been largely replaced by smartphone apps. The company now primarily generates revenue by selling map technology to car and smartphone manufacturers, including partnerships with major companies like Apple, Huawei, Volkswagen, and Renault.
Despite short-term challenges, including trade tensions resulting from US tariffs that Goddijn told investors in April made the outlook "less predictable," the CEO maintains confidence in TomTom's long-term trajectory. The company's AI-driven approach represents a significant industry-wide transformation that prioritizes technological efficiency over traditional business models, mirroring similar shifts at tech giants like Microsoft, Google, and IBM.