Toyota fourth-quarter profit misses by wide margin as U.S. tariffs drive 49% slump

Japan’s Toyota Motor on Friday reported a 49% drop in fourth-quarter operating profit, missing analysts’ estimates as U.S. tariffs pressured earnings.

Here are Toyota’s results compared with median estimates from LSEG:

• Revenue: 12.6 trillion yen vs. 12.6 trillion yen expected
• Operating profit: 569.4 billion yen vs. 813.28 billion yen expected

The world’s largest automaker by sales volume saw a 1.89% year-on-year rise in revenue during the fourth quarter ended March, in line with expectations.

The results mark Toyota’s fourth consecutive year-over-year decline in operating profit after its earnings fell 2%, reflecting persistent pressure from U.S. tariffs.

Net income attributable to the company was 817.2 billion yen from 664.6 billion yen a year ago.

The automaker’s consolidated vehicle sales in its financial fourth quarter fell to 2.29 million from 2.36 million units a year earlier.

Toyota lowered its operating income forecast by over 20% to 3 trillion yen for the financial year ending March 2027, while raising its sales revenue forecast by 0.6%.

“We have recently seen a significant rise in our breakeven volume due to a combination of increases in investments in human resources and future-oriented investments and the impact of U.S. tariffs,” the company said in an earnings statement on Friday.

Toyota added that it had begun measures to increase earnings through “reforming fixed costs, achieving cost improvements, and initiating sales initiatives in all regions, groups, and in-house companies.”

The productivity of Toyota Motor’s assets declined over the full period 2016–2025, with a minor downtrend in asset turnover, according to a May 5 report by Price Target Research.

Toyota is facing challenges, weighed down by slowing sales in China’s auto market, vehicle recalls, intensifying competition in the electric vehicle space from peers, and Trump-related tariffs.

The company posted weaker U.S. quarterly sales in the first quarter amid concerns about affordability and fuel price pressures from the Middle East conflict. Toyota has also been trying to navigate production plans amid tariffs and other regulatory changes.

The company said in March that it would spend $1 billion total at two U.S. plants as part of a plan to invest up to $10 billion there over the next five years.

Toyota shares last traded 1.34% lower in Tokyo on Friday.