TomTom shares plunge on profit warning

Shares in navigation device maker TomTom NV fell sharply after the company cut financial estimates for 2008, blaming weak pricing power and retailers' stocking fewer of its products, an Associated Press report said.

The report said that in the first quarter 'retailers reduced their inventory levels more strongly than expected, especially in Europe,' where TomTom has a 50% share of the market for devices used in cars, according to a company statement.

TomTom said its first quarter revenue will be around €260-€270 million (US$408-425 million), less than the €296 million it reported in the first quarter of last year.

The Amsterdam-based said operating margins will be in the 'low single digits,' down from double digit growth in recent quarters. It is due to report earnings on 23 April .

The company had previously forecast sales growth of at least 20% in 2008, but it acknowledged that won't meet that target, although it had 'reduced prices "&brkbar; earlier than planned, ahead of the introduction of new products in the second quarter.'

Its shares tumbled 13.8% to €22.78 (US$35.78) in Amsterdam.