Toyota Forecasts 20% Full-Year Profit Decline After Blockbuster Q4

Reuters05-08

TOKYO, May 8 (Reuters) - Toyota Motor forecast a 20% decline in operating profit for the current financial year on Wednesday, after reporting a blockbuster 78% profit increase in the fourth quarter that just ended.

The world's top-selling automaker expects operating income to total 4.3 trillion yen ($28 billion) in the year to March 2025, versus 5.35 trillion yen in the year that just ended.

Toyota said the forecast took into account investments of 380 billion yen in "human capital", including providing support for labour costs of suppliers and dealers, as well as investments for its "multi-pathway" strategy.

That strategy, of pursuing multiple types of powertrain for cars - including hybrids, plug-in hybrids and battery EVs - appears to be paying dividends for Toyota as drivers have cooled on EVs in many markets in recent months.

In the January-March fourth quarter, Toyota delivered a 78% increase in operating profit, of 1.11 trillion yen. That compared to the 747.3 billion yen average of nine analyst estimates compiled by LSEG.

The result was helped by the weak yen lifting the value of overseas sales, as well as solid demand.

Still, Toyota is not without its challenges, particularly in key markets such as China, where it has struggled to keep up with the pace at which a growing number of local manufacturers are rolling out software-loaded electric vehicles.

($1 = 155.1400 yen)

Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.

Comments

Dr Rck
05-08
Dr Rck
All cars sales are falling across the board whether they are EV, hybrid or otherwise! This proves to be challenging even for TSLA at the level they re in right now to emerge stronger than the rest since it is already experiencing dwindling sales. And the Fed may not cut interest rate too soon, but wait out till inflation rate stabilises! April records dropping sales -2% in China, so definitely it will be a while before improvements can be seen. So what will happen during this period before the next Fed meeting in June?
- Dr Rck:
  So why is TSLA stock price continues to rise even during such challenging times although some industries fare well amd better? Confidence in the leadership of TSLA and not fundamentals. Its intrinsic value is simply too high, Warren Buffet hemce has its reasons why investing in TSLA is a no no. Consider TSLA as a gambling, meme or speculative stock however you call it, it is like watching UFC when you look at its stock, excitement and manipulative! Dont buy the stock of you are not prepared for the turbulence!
- AbnerKeppel:
  Great analysis!
- Dr Rck:
  Car sales continues to tumble worldwide. Toyota issues guidance for higher costs for materials and lower sales citing serious price war in China; Mercedes switching back to gas combustion automobile for sale as EV drags; so undoubtedly these are headwinds for a lot of car companies; if Fed cuts can come sooner otherwise return of equity suffers, but only pocketed sectors are thriving like AI but even ARM has sounded warnings that AI will wane soon as it suffers drop in revenue
- OYoung:
  People just don’t have that much money to buy cars!
- chimey:
  So you see all the motor stocks just fall so much!!