Toyota (TM.US) Q2 operating profit fell 27% year on year, less than expected but raised full-year profit and sales guidance

The Zhitong Finance App learned that Toyota Motor Corporation (TM.US) announced its results for the second quarter of the 2026 fiscal year ending September 30. According to financial reports, Toyota's Q2 revenue was 12.38 trillion yen, up 8% from 11.44 trillion yen in the same period last year; operating profit was 839.6 billion yen, down 27% from 1.16 trillion yen in the same period last year, the second consecutive quarter year-on-year decline, falling short of analysts' general expectations of 863.1 billion yen; net profit was 932 billion yen, up 62% from 573.7 billion yen in the same period last year.

Looking ahead, the world's largest automobile manufacturer expects operating profit of 3.4 trillion yen (or 29% year-on-year decrease) in the 2026 fiscal year ending March 2026. Although this forecast is lower than analysts' general expectations of 3.9 trillion yen, it is higher than the 3.2 trillion yen forecast in the company's first-quarter earnings report because its cost reduction efforts and strong hybrid vehicle sales are expected to help offset the impact of US import tariffs.

The company expects full-year revenue of 49 trillion yen and full-year net profit of 2.93 trillion yen for fiscal year 2026. The company also anticipates that the full year of fiscal year 2026 will sell 11.3 million vehicles, higher than the 11.2 million units previously estimated.

Previously, the trade agreement reached between Japan and the US avoided the worst situation of imposing tariffs on automobiles and auto parts. After Japan and the US reached an agreement in July, the US imposed a 15% tariff on automobiles and parts from Japan. Although this is a sharp increase from the previous 2.5% tax rate, it is far lower than the 25% additional tariff that US President Trump previously threatened to levy.

Toyota said its 2026 full-year results guidance reflects the negative impact of US tariffs on its operating profit of 1.45 trillion yen. The company added that US tariffs in the first half of fiscal year 2026 had a negative impact on its operating profit of 900 billion yen.