Toyota Motor Corporation
TM · NYSE
Sep 2026
Next quarter
Expected to report Nov 4, 2026 — estimated from last year’s reporting date.
TM Jun 2026
- -1.73%
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- $7.57
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Highlights
- Headline earnings: Net income attributable to Toyota rose 75.6% year over year to ¥1,477.0 billion, while IFRS basic EPS increased to ¥120.69 from ¥64.56; the supplied reported EPS figure was 7.57.
- Revenue and operating profit: Sales revenues increased 10.4% to ¥13,525.4 billion, but operating income fell 8.8% to ¥1,063.5 billion, reducing the operating margin to 7.9% from 9.5%.
- Non-operating uplift: Income before taxes jumped 56.8% to ¥1,963.9 billion, helped by an ¥814.3 billion year-over-year increase in non-operating income, including higher finance income and a swing to a net foreign-exchange gain.
- Automotive pressure: Automotive revenue rose 8.8% to ¥12,012.7 billion, but segment operating income declined 21.0% to ¥719.9 billion as expenses and other items more than offset currency benefits.
- Currency and cost bridge: Operating income benefited by ¥345.0 billion from exchange rates and ¥70.0 billion from marketing efforts, but was reduced by ¥190.0 billion from expenses, ¥85.0 billion from cost reductions and ¥242.6 billion from other factors.
- Regional mix: North America returned to operating profit of ¥185.4 billion from a ¥21.2 billion loss, while Japan’s operating income fell 16.3% to ¥540.1 billion despite an 8.9% increase in domestic vehicle sales.
- Financial services: Financial-services revenue increased 23.3% to ¥1,400.6 billion and operating income rose 24.0% to ¥275.6 billion, primarily on a larger loan balance.
- Full-year outlook: Toyota revised its FY2027 forecast to ¥54.0 trillion of revenue, ¥3.4 trillion of operating income and ¥3.25 trillion of attributable net income, with basic EPS forecast at ¥272.17; the dividend forecast increased to ¥100 per share from ¥95 in FY2026.
- Capital allocation and cash: Toyota repurchased ¥3,656.9 billion of stock in the quarter, driving financing cash outflow of ¥4,339.1 billion and reducing cash and equivalents 18.3% from March to ¥10,343.1 billion.
Analysis
Toyota’s FY2027 first quarter was a revenue-growth and financial-income quarter rather than an operating-profit quarter. Revenue rose 10.4% year over year to ¥13.53 trillion, but operating income fell 8.8% to ¥1.06 trillion and the margin contracted to 7.9% from 9.5%. Sequentially, the print improved sharply from the March quarter: revenue was up 0.5%, operating income increased 86.7% from ¥569.4 billion and attributable net income rose 80.7% from ¥817.2 billion. The supplied earnings line reports EPS of 7.57, but provides no separate estimate against which to assess a beat or miss; IFRS basic EPS was ¥120.69 versus ¥64.56 a year earlier.
The defining feature was the gap between operating and reported earnings. Automotive operating income declined 21.0% despite higher sales, while exchange rates added ¥345.0 billion to operating income and North America swung back to profitability. Below operating income, a ¥814.3 billion increase in non-operating income, including finance and foreign-exchange gains, lifted pretax income 56.8% to ¥1.96 trillion and net income attributable to Toyota 75.6%. Toyota revised its full-year forecast to ¥3.4 trillion of operating income and ¥3.25 trillion of attributable profit, while executing ¥3.66 trillion of buybacks that materially reduced quarter-end cash.
Operating profit pressure
- Consolidated result: Revenue grew ¥1,272.0 billion, or 10.4%, to ¥13,525.4 billion, but operating income declined ¥102.6 billion, or 8.8%, to ¥1,063.5 billion. The operating margin fell to 7.9% from 9.5% a year earlier.
- Operating bridge: Exchange rates contributed ¥345.0 billion and marketing efforts contributed ¥70.0 billion. These gains were outweighed by ¥190.0 billion of higher expenses, ¥85.0 billion of cost-reduction headwinds and ¥242.6 billion from other factors.
- Volume context: Consolidated vehicle sales decreased 0.7% to 2.395 million units. Japan increased 8.9% to 524,000 units, but overseas sales fell 3.1% to 1.870 million units.
Automotive performance
- Segment result: Automotive revenue increased 8.8% to ¥12,012.7 billion, while operating income dropped 21.0% to ¥719.9 billion. Toyota attributed the decline mainly to higher expenses and other factors.
- Geographic split: Japan revenue rose 11.8% to ¥5,824.5 billion, but operating income fell 16.3% to ¥540.1 billion. Asia operating income declined 3.4% to ¥208.3 billion, and the other regions declined 1.6% to ¥92.5 billion.
- North America recovery: North American revenue increased 14.9% to ¥6,105.7 billion and operating income improved to ¥185.4 billion from a ¥21.2 billion loss, helped by lower expenses and expense-reduction efforts.
- Europe: European revenue rose 20.4% to ¥1,879.8 billion and operating income increased 10.6% to ¥107.2 billion, with marketing efforts cited as the main driver.
Non-operating earnings
- Pretax conversion: Income before income taxes increased 56.8% to ¥1,963.9 billion, far outpacing operating profit because non-operating income rose ¥814.3 billion year over year.
- Main contributors: Other finance income increased to ¥850.6 billion from ¥153.7 billion, other finance costs rose to ¥285.6 billion from ¥6.2 billion, and net foreign-exchange results swung to a ¥112.4 billion gain from a ¥212.4 billion loss.
- Bottom line: Attributable net income rose 75.6% to ¥1,477.0 billion, and basic EPS increased to ¥120.69 from ¥64.56. The quarter also included ¥210.7 billion of equity-method profit, up from ¥141.0 billion.
Financial services
- Growth: Financial-services revenue increased 23.3% to ¥1,400.6 billion, while operating income rose 24.0% to ¥275.6 billion.
- Driver: Toyota said the operating-income increase was mainly due to an increase in the loan balance, making financial services an important offset to weaker automotive profitability.
Outlook and capital
- Revised outlook: Toyota’s FY2027 forecast is now ¥54.0 trillion of revenue, ¥3.4 trillion of operating income, ¥4.57 trillion of income before taxes and ¥3.25 trillion of attributable net income. Basic EPS is forecast at ¥272.17.
- Shareholder returns: The full-year dividend forecast increased to ¥100 per share from ¥95 in FY2026, consisting of a forecast ¥50 second-quarter dividend and ¥50 year-end dividend.
- Buybacks: Toyota repurchased ¥3,656.9 billion of stock during the quarter. Average shares outstanding fell to 12.239 billion from 13.033 billion a year earlier, while shares issued and outstanding fell to 14.595 billion from 15.795 billion.
- Liquidity: Cash and cash equivalents declined ¥2,316.5 billion, or 18.3%, from March 31 to ¥10,343.1 billion. Operating cash flow fell to ¥536.6 billion from ¥1,876.5 billion, while financing cash outflow increased to ¥4,339.1 billion.
- Comparability: Toyota excluded 70 companies, including Hino Motors and its consolidated subsidiaries, from consolidation during the period. It also classified part of its ARCHION shareholding as held for sale.
