By Islam El-Sakka
Toyota Motor Corp. reported a 19% decline in fiscal second-quarter net profit on Thursday but raised its full-year earnings forecast, citing resilient sales and a weaker yen that boosts overseas revenue.
Quarterly Results
For the July-September period, net profit fell to 759.4 billion yen ($4.8 billion) from 932 billion yen a year earlier. Quarterly revenue rose to 13.4 trillion yen from 12.4 trillion yen, despite headwinds from U.S. tariffs, supply disruptions, and higher raw material costs linked to the Middle East conflict.
Full-Year Outlook
The automaker now projects a full-year profit of 3.57 trillion yen for the fiscal year ending March 2027, up from a previous forecast of 3.25 trillion yen. Profit for the prior fiscal year totaled 3.8 trillion yen. Toyota expects to sell 9.7 million vehicles globally this fiscal year, slightly above the 9.6 million sold last year.
Regional Performance
Vehicle sales in the first half dipped to 4.76 million from 4.78 million a year ago. Sales in China weakened amid surging gasoline prices, while the U.S. market remained strong and Japan and Europe held steady. In Japan, the RAV4, bZ4X, and Land Cruiser FJ SUVs sold well; in the U.S., the Camry and RAV4 hybrids were popular. Overall Asian sales were flat, though Indonesia and Thailand showed growth.
Market Reaction
Toyota shares jumped in Tokyo trading to about 3,500 yen from roughly 3,200 yen following the earnings release. The company said it mitigated rising material costs by optimizing its global supply network. The U.S. dollar traded around 158 yen, up from 154 yen a year ago, enhancing the value of overseas earnings when converted to yen.
