Toyota fourth-quarter profit misses by wide margin as U.S. tariffs drive 49% slump
Toyota sign at the New York International Auto Show in New York City on April 2, 2026.
Danielle DeVries | CNBC
Japan’s Toyota Motor on Friday reported There was a 49% drop in operating profit in the fourth quarter; Analysts’ forecasts fell short as US tariffs weighed on earnings.
Here’s how Toyota’s results compare to LSEG’s average estimates:
- Revenue: 12.6 trillion yen, expected 12.6 trillion yen
- Operating profit: 569.4 billion yen versus expectations of 813.28 billion yen
The world’s largest automobile manufacturer by sales volume, In the fourth quarter ending in March, revenues increased by 1.89% on an annual basis, in line with expectations.
Toyota Motor Shares
The results mark the fourth consecutive annual decline in operating profit after Toyota’s earnings fell 2%, reflecting persistent pressure from US tariffs.
Net income attributable to the company was 817.2 billion yen, down from 664.6 billion yen a year ago.
The automaker’s consolidated vehicle sales in the fiscal fourth quarter fell to 2.29 million units compared to 2.36 million units a year ago.
Toyota cut its operating income forecast for the fiscal year ending March 2027 by more than 20% to 3 trillion yen, while increasing its sales revenue forecast by 0.6%.
“We have recently seen a significant increase in our breakeven volume due to increases in investments in human resources and future investments, as well as the impact of U.S. tariffs,” the company said in its earnings report. expression on Friday.
Toyota added that it had begun measures to boost earnings by “reforming fixed costs, delivering cost improvements and launching sales initiatives across all regions, groups and internal companies.”
According to Price Target Research’s report dated May 5, the efficiency of Toyota Motor’s assets decreased over the entire period of 2016-2025, with a small downward trend in asset turnover.
Toyota faces challenges exacerbated by slowing sales in the Chinese auto market, vehicle recalls, increased competition from rivals in the electric vehicle space and Trump-related tariffs.
The company reported weakness in quarterly sales in the U.S. in the first quarter due to concerns about affordability and fuel price pressures resulting from conflict in the Middle East. Toyota is also trying to navigate production plans amid tariffs and other regulatory changes.
The company announced in March that it would spend a total of $1 billion on two facilities in the United States as part of a plan to invest up to $10 billion over the next five years.
Toyota shares were last traded down 1.34% in Tokyo on Friday.
