Good day, ladies and gentlemen. Welcome to TomTom's first quarter 2024 results conference call. At this time, all participants are in listen-only mode. We will be facilitating a question-and-answer session toward the end of today's prepared remarks, at which time if you would like to ask a question, you may do so by pressing Star one one on your telephone keypad, where you will hear an automated message advising your hand is raised. Please be advised if you are calling in via Microsoft Teams, please ensure you press Star one one from the keypad where the call is made and not from your Teams screen in order to enter the queue. Please note that this conference is being recorded. I will now turn the call over to your host for today's conference, Freek Borst, Investor Relations. You may begin. Thank you, operator, and good afternoon, everyone. Welcome to our conference call. Today we will discuss the operational and financial highlights for the first quarter of 2024. With me today are Harold Goddijn, our CEO, and Taco Titulaer, our CFO. Starting off, Harold will discuss first quarter operational developments, after which Taco will provide a more detailed look at the financial results and outlook. We will then take your questions. As usual, I would like to point out that Safe Harbor applies. And with that, Harold, I would like to hand it over to you. Yeah, thank you. Thank you very much, Freek. Good day, ladies and gentlemen. Thanks for being with us today. I'll give you a brief overview of the key operational highlights in progress, and then Taco will delve into the financial details. Our revenue in the first quarter of 2024 was comparable to that in the same period of last year. While the location technology top line showed no significant growth, we made substantial progress in maturing our product offering and expanding our business development activities. The rollout of our new TomTom Orbis Maps proceeded as scheduled during the quarter, and we now have achieved geographic global coverage. We're offering a global mapping product. The new maps boast advanced visualization capabilities, an appealing design, and feature much-improved POI, search, and routing quality. Introduction of the new maps has enabled us to broaden our market reach, catering for a wider range of use cases and industry, resulting in an expanded sales funnel and increased commercial momentum. We've observed a growing variety of use cases for our products and services. During the quarter, we announced partnerships with enterprise customers across diverse industries and sectors, supporting a wide range of applications. These partnerships include ventures in railroad logistics, insurance technology, location-based marketing, electric vehicle charging, and more. Our new mapping platform allows easier integration of data from other users and producers of geographical data. As previously communicated, the establishment of the Overture Maps Foundation with AWS, Meta, and Microsoft has been instrumental in facilitating interoperability and defining the specifications of our databases. We are very pleased to see some prominent companies joining us and our Overture co-founders during the quarter. Overture is now gearing up for the first releases. With the successful progress of both the Orbis rollout and the Overture initiative, we remain on track to achieve our strategic goals. With that, I will pass forward to Taco. Thank you, Harold. Now, I would like to provide some insights into our financials and outlook for the year. After that, we will move on to your questions. Group revenue for the third quarter decreased by 1% year-on-year, coming in at EUR 139 million. Our location technology revenue came in at EUR 190 million, comparable to the revenue in the same quarter last year. Let me break down our revenue and discuss it business by business, starting with automotive. Automotive IFRS revenue was EUR 83 million, a modest year-on-year increase of 3%. Automotive operational revenue decreased by 6% year-on-year to EUR 79 million. This decrease partly reflects lower car production at some of our customers, further, a difference in phasing of ramp-ups and ramp-downs of certain car lines negatively impacted the quarterly automotive operational revenue as well. Our enterprise business recorded revenues of EUR 35 million, a decrease of 4% year-on-year. We expect the gradual conversion of our sales funnel to lead to increasing revenues later this year and in 2025. Lastly, consumer revenue was EUR 21 million, a decrease of 9% year-on-year. Gross margin in the first quarter was 86%, comparable to the same quarter last year. First quarter operating expenses were EUR 125 million, an increase of 6% versus the same quarter last year. Quarter-over-quarter, we saw a decrease in operating expenses, also when correcting for the EUR 10 million restructuring expense recognized last quarter. This decrease demonstrates our continuous efforts in keeping costs under control. Free cash flow was an outflow of EUR 9 million this quarter, compared with an inflow of EUR 10 million in the same quarter last year. First quarter free cash flow was affected by the annual bonus payments as well as payment of the charges related to the restructuring we announced in the fourth quarter of 2023. These restructuring-related payments are not separately adjusted for and are absorbed in our free cash flow. We ended the quarter with a net cash position of EUR 284 million, down from EUR 350 million at the end of the year. This decrease mainly reflects EUR 20 million cash out related to our EUR 50 million share buyback program. This program, which is aimed at reducing our share capital, was 64% completed by quarter end. Having covered our results, let's move on to our outlook. Though top-line development was flat in the first quarter, we did see encouraging signs from a product and business development perspective. We are reiterating our guidance that we gave at the start of the year. For full year 2024, we continue to expect group revenue between EUR 570 million and EUR 610 million, and location technology revenue between EUR 490 million and EUR 520 million. Free cash flow is expected to be higher than 5% of group revenue. For 2025, we are also reiterating our midterm location technology revenue ambition of EUR 600 million and midterm free cash flow target of 10% of group revenue. Operator, we are now ready to address any questions from our listeners. And thank you. Thank you. We will now begin the question-and-answer session. If you have a question, please press Star one and one on your telephone and wait for your name to be announced. To withdraw your question, please press Star one and one again. If you are calling in via Microsoft Teams, please ensure you press Star one one from the keypad where the call is made and not from your Teams screen in order to enter the queue. Please stand by while we compile the Q&A queue. Our first question comes from the line of Andrew Hayman from Independent Minds. Please go ahead. Your line is open. Yes, just a few questions for you. In terms of operational automotive revenue, it was down 9% in the quarter, and you highlighted lower auto production volume and the phasing of some car lines. How comfortable are you that it is simply a phasing issue and not an issue with, let's say, a model that's important to TomTom? Then maybe a second question on the automotive side and looking a bit longer term. A couple of the stories that are getting a lot of attention at the moment are a pushback on EVs is one. And then on the other hand, there's also, let's say, a bit more excitement with autonomous driving, particularly from Tesla. I was wondering, looking midterm, how you see those two factors impacting TomTom. And then maybe on enterprise, the movement in deferred revenue is a EUR +10.8 million. You highlight that that's the timing of invoicing being a factor. I was wondering what's behind that. Is that new clients that's pushing that up, or is it a more business with an existing customer? Yep, that's it. Thank you. Yeah, let me address for you said 9%. It is 6% down operating revenue of automotive. We think that later in the year, that the trend between market development and operating revenue will reverse. And hopefully, at the fourth quarter, we can do better than the market. That is at least where we expect the trends to develop towards. But indeed, this quarter, it was not good. That was related to a relative underperformance of the customers that we serve compared to the market as a whole and had to do with timing of end of production and start of production on various contracts. So that is just more a timing thing, and the expectation is that that will recover itself towards the second half of the year. EV and autonomous driving are two trends that will increase take rates. For both, we see lots of development and business development. It's indeed true that the increase as a percentage of sales of EV is slowing down. Yeah, it's not something that we can influence. I don't think it's structural either. It's a temporary thing. But again, both are beneficial for the take rates as a whole. Your last question on deferred revenue with enterprise, that is just normal seasonal patterns on payment behaviors of large customers. I wouldn't read too much into it. Okay. Thank you. Thank you. We'll now move on to our next question. Our next question comes from the line of Wim Gille from ABN AMRO - ODDO BHF. Please go ahead. Your line is open. Yes, hey. Very good afternoon. I got two questions. First, looking at the enterprise decline in revenues, we've seen enterprise revenues coming down for a number of quarters as the Apple contract was renegotiated already Q4 2022. So this is no longer an issue. So can you give us a bit more feeling on what caused the decline in enterprise in this particular quarter and how we should look at the remainder of the year? I know you have a fair amount of discussions going on with the new Orbis map, but when will growth in enterprise resume? Is that already Q2, or is this more weighted towards the second half? And then with respect to the automotive operational revenues, I had a bit of a bad connection with the previous person asking the question. So could you repeat the answer there? Basically, what I want to know is what's the decline of 6%, which is driven by a decline in car production, and what part is driven by the phase out of Renault, which is not fully compensated by the phase in of Volkswagen? And when would you expect the phase in of Volkswagen to be higher than the phase out of Renault? Is that going to be Q2, Q3? Do you have any visibility there? Yeah. No, I think most questions are for me, but please come on, Harold, if you want to add. Enterprise decline, there is a single large customer who is building mapping capacity themselves. That contract is declining year-over-year, and that continues to decline. So the phase out will continue for another year or so. So you see year-over-year decline. So that's starting in Q4 of 2022, and that will continue into Q4 of 2025. That's a phased decline. So that explains why there is no year-on-year growth in enterprise yet. To address your second question about when do we expect increase in enterprise, we expect sequential increase in enterprise to start in Q3. We expect year-over-year increase in enterprise to start in Q4. To come back to Andrew's question, I think it is I would say it's 50/50. I can't comment on the speculation you gave yourself, but I will not deny it either. But it is half the underperformance of our customers compared to the market and half the phase out and phase in. Where would we expect the phase in to compensate or be bigger than the phase out? Oh, yeah. No, yeah. We expect that overall, that the contribution of the new customer will be bigger than the loss of the old customer. That effect will start to play Q4, Q1, that timeframe. But again, what I also said to you with Andrew, in our estimates, we think that if you compare operating revenue with the market trends so the market trends is quite stable Q1. The expectations of the industry analysts is that that will continue to be the case in Q2. And then we see a bit of improvement in Q3 and Q4, more improvement in Q4. But similarly, we think that operating revenue will improve for TomTom. And the expectation is that we could do better in the fourth quarter than the market. Thank you. We'll now move on to our next question. Please stand by. Our next question comes from the line of Marc Hesselink from ING. Please go ahead. Your line is open. Yes. Thank you. First question is from Orbis. You're seeing increased momentum in the sales funnel. Just wondering if this is mainly smaller clients, or is it also some really big clients that just one client really moving the needle? Link to that on the Orbis. You're now moving all the traditional contracts, I think, to the Orbis platform. Can you provide an update? How much percent is already on the new platform? When do you expect this to be fully moved? And when it is fully moved, can you maybe talk about the impact both commercially and also from a cost level when that is done? And the second group question is on the Overture initiative. Obviously, really big names in there. And just trying to get my head around, they all have their own mapping teams. They're doing a lot of stuff themselves. They take a lot of data from the open source. What kind of layers would they then take from TomTom on top for you as an opportunity to really monetize it? Thank you. Yeah, Mark, thank you. Yeah, the sales funnel is really a mixture of different-sized companies. There's some very significant deals both on the automotive side and on the enterprise side. But there is also a large number of smaller opportunities that are opening up because of the Orbis database and the new APIs and SDKs that we are publishing on top of that database. So it's really a mixed bag of bigger numbers and a lot of smaller numbers. So then moving customers from the existing platform to Orbis, that's not happening at scale. And I don't think that will happen. I think if you look at what's happening in the auto industry, a lot of our customers will continue to use that have started with Genesis will continue on the Genesis database and continue to use that for a number of years into the future. The switching of software and data in an in-car environment is notoriously hard. At the end of the day, car makers are not that interested in doing that once the car has left the factory. But what we have achieved is that Orbis is now, let's say, internally, our master database. All the changes that we achieve and upgrades and extensions of the data that we achieve in our Orbis mapping platform will go through, will automatically, to a large extent, flow through to the legacy database, to the Genesis database. And that way, we keep the Genesis database fresh. We keep it up to date at minimal cost, mostly using automated processes. But all the innovation and new data types and the geographical expansion will really materialize on the forward-looking products and on the Orbis platform. Does that answer your question? Yeah, it's clear. I think then it's fair to assume that a lot of these clients will stay also when they renew the contract, they will stay on Genesis, or is the renewal a typical moment when they will shift to Orbis? No, it's mostly tied to introduction launching of new car models. And with some of our larger customers, we are aiming to introduce Orbis maps beginning of 2025 for SOPs that are happening around that timeframe or a bit later, I would say. So those are customers who are currently using the Genesis database but where the Orbis database will feature in new car models. Okay. And the other question on the Overture, those clients? Yeah. So, Overture is, so there's a couple of things happening in Overture that are important for the industry. We're trying to establish a standard. There is no standard for map-making, and there is no interoperability. And if you look at the requirements now and in the future, to keep up with those demands and use cases, you need to have more partners contributing to the data. To facilitate that, we publish a standard to base map, which is really quite bare, but it's an important canvas on which other companies can match their own content. And that can be an HD layer, or it can be a POI dataset, or it can be visual aspects, 3D buildings, photorealistic data that you can all attach to that map in a way that makes it easy and cheap to do that. With the base map itself, you can't do that much. A lot of essential attributes are missing there. So if you want to have industry strength routing or search or not, then the base map in itself is not going to help you. You will need to upgrade to a commercial version of that map. And of course, we are concentrating ourselves in standardizing OSM data, making it fully controlled and making it harmonious so it works everywhere. Then we have all sorts of data related to addressing, related to POIs, related to the road conditions and speeds and all that kind of stuff. So there's a whole stack of data on top of that that, in combination, will make the map that can be used in real-world applications. Okay. And those clients will then pick and choose a few layers from TomTom, add their own layers, and that's then at the end what they will do? That's a possibility. a possibility. That's a possibility. It depends a little bit on the type of customer and the size of the customer. You need to be a sizable company for you to if you want to do layers on the layer level yourself. So the majority of our customers will take the final product that they can license from us. But other customers who like a large ride-hailing company, they want to augment that database with what they have learned from their drivers and their customers, like pickup points and how buildings or cafés or restaurants are referred to by customers. That's knowledge that a ride-hailing company will accumulate. And the Orbis structure and the Overture standardization and classifications and how you do all that makes it really simple to actually do that and achieve that. You call that conflation. This is notoriously difficult in the industry. And we're making that easy for the industry as a whole. On top of that, there's a whole range of open-source tools. We publish the database in a format that has wide industry support. There are a lot of developers who know how to work with that format. There's a lot of open-source tools that can help you to lower your overall cost of ownership of a location platform. I think that's one of the key elements of the commercial story, is that this will grow and that it will grow faster than the other map ecosystem and that there is already widespread support for the data format. And that will only accelerate and accumulate over time, which eventually will lead to a far superior mapping platform than anything else that is out there. That is one of the key elements for potential customers to go through to a non-inconsiderable amount of pain if you want to switch from location platform. That's a big decision, typically, for a company. But the idea that you are on a winning platform that will grow and that's well supported by industry, both on the data side and on the tooling side, that is very appealing and a very strong sales argument, certainly over time. And that argument will grow in strength. And if we provide more proof points and show that more customers are taking that effort to change from location provider, that, again, will help us to faster convert our sales funnel and for our sales force to become more effective. So we are in the early days. I think what is important for us as a team is that we see that the strategy, as we had designed it in 2019, is working. We see the effects, certainly, in the pipeline, the discussions we have with sales funnel and the variety of customers that we're talking to, to whom we have never spoken in the past. All are key indicators, leading indicators for us that that strategy that we have developed over the last and implemented is working. So from that perspective, we are on track. Strategically, it is working as we have hoped and expected. So now I'd say it's a matter of converting all those opportunities that are opening up to real contracts going forward. But I think both in the auto industry as well as in the enterprise segment, that strategy is clear. It resonates. I definitely believe it will give us an edge going forward for years to come. Great. Thanks for the elaborate answer. Really clear. Yeah. Thank you. Thank you. We'll now move on to our next question. Excuse me. Once again, if you do have a question, please press star one and one on your telephone and wait for your name to be announced. To withdraw your question, please press star one and one again. We'll now move on to our next question. Our next question comes from the line of Nikos Kolokotronis from Van Lanschot Kempen. Please go ahead. Your line is open. Hi. Good afternoon. Thanks for taking my question. So first of all, under Orbis, can you give us a bit more color on how you expect a typical sales cycle to look like under the new maps in terms of timeframe and the time that it's going to take for the testing process and the eventual conversion to sales? And my second question is on the funnel of Orbis. So it's building up well. Can you comment on what are your communications with the companies in the funnel and at what stage in the sales cycle you are, on average, with these companies? And if you could comment separately on large accounts versus small ones. Thank you. Yeah. So Nikos, thanks for the question. So first question about conversion. Now, what does that look like, and how long does it take? It's a bit of a mixed bag. So customers who know us from the past, who have been dealing with in the past and to whom we introduce our plans and strategies, say, "Yeah, I get it. I understand it. I like what you're doing." It doesn't take that much to convince those types of customers. And we can substantiate it with statistics and analytics and all the rest of that. It's demonstrably objectively better than anything else that is available. So that's an easy sell. That doesn't mean that everybody starts to run to convert, but it does mean that when they're up for renewal or they're up for a new introduction, a new launch, or a new program, the default choice is for Orbis, and it doesn't require a lot of extra work for us. So that's one extreme. So customers who understand this know what we're doing. They can see the results, and they're taking interest in the metrics that we are now starting to share with those customers. On the flip side, there's a type of customer that we know can use the data but to whom we are unfamiliar. There it takes longer. There you need to go through another different type of sales cycle where you have to introduce yourself first. And that takes longer. You need to introduce yourself, and then you need to introduce your strategy, and then you need to introduce your product. And that takes longer. But also there, once we are engaging and when there is a sales opportunity or a product replacement opportunity, it's fair to say that also those type of customers show an interest in what we're doing. And there again, in that environment, at least strategically, those customers understand what we're trying to do and like that idea, the direction of travel. But it takes more time to convince, and you need to provide more proof points. I think there's a couple of large customers who will start converting and introducing Orbis on their own platforms. That will, in itself, be an important proof point for everybody else to get easily convinced that Orbis has reached maturity and is ready for prime time. That's kind of where we are in terms of that whole commercial journey. Okay. Thank you. Thank you. We'll now move on to our next question. Our next question comes from the line of Maarten Verbeek from The Idea. Please go ahead. Your line is open. Good afternoon. It's Maarten Verbeek of The Idea. Firstly, you mentioned that an enterprise, a large enterprise client, was starting to build its own map, and that would give some negative pressure on your enterprise revenue. To get a bit of feel of the underlying development for enterprise, how much sales do you expect to lose from this client compared to last year's level in the next two years? Yeah. Maarten, I fully understand your question, but I can't comment on it. Apart from what I already answered to Wim, is that we expect a sequential increase in our enterprise revenue as of Q3 and a year-on-year increase in our enterprise revenue as of Q4. More details I can't provide. Also, client confidentiality. Okay. And also to get a bit of a feel for the underlying free cash flow, last year, you took the almost EUR 10 million restructuring charge. You stated that would be consumed in the first half of this year. Is it still the case? And could you also give us some kind of information on how much you have used, how much you have spent of that provision in the first quarter? Yeah. The lion's share of that was paid out in the first quarter. More or less, the remainder will be executed in the second quarter? There is always a long tail for individuals. But indeed, I think after the second quarter, 90% of that will have been paid. Thanks. And lastly, since you expect some tough quarters in automotive, according to your backlog, the breakdown, you expected revenue of automotive to be in the neighborhood of EUR 350 million for this year. Has that changed now we have entered into April? No, it hasn't. Of course, there is some lost revenue in Q1 that will not be recouped later in the year, but there's also a fair amount of revenue that will come later. So overall, it might be EUR 2 million below where we thought it could be, where the middle of the bell curve could end up, but it is still within that range. And so the EUR 350 million is a very fair estimate. Thanks very much. All right. Thank you. Thanks. Since it appears there are no further questions, I would like to thank you all for joining us this afternoon. Operator, you may now close the call. Thank you. This concludes today's presentation. Thank you for participating. You may now disconnect.