Toyota Raises Earnings Guidance, Announces More Than $6 Billion Buyback — Update

By Kosaku Narioka and Ronnie Harui

Toyota Motor raised its annual earnings forecasts, citing a weaker yen and a smaller impact from the Iran war, and unveiled a more than $6 billion buyback as quarterly net profit rose sharply.

The Japanese carmaker on Tuesday reported stronger net profit for the three months ended June, supported by a weaker yen and gains in financial income, even as vehicle sales were dragged by a drop in sales in the Middle East.

Toyota also lowered the expected hit from war-related disruptions, now estimating a 510 billion yen, equivalent to $3.24 billion, drag on operating profit for the year ending March 2027. It had forecast a Y670 billion impact previously.

The automaker has been establishing alternative routes to shorten the time it takes to deliver vehicles to customers, according to Takanori Azuma, Toyota's chief officer for accounting.

The company said it will buy back as much as Y1 trillion of its own shares over the next year, repurchasing up to 4.2% of outstanding shares under the program.

The stock closed 1.5% lower following the first-quarter results, bringing year-to-date losses to 13%. Shares have been weighed by concerns about higher energy prices and weaker consumer sentiment amid the Middle East conflict.

The Japanese carmaker has been taking steps to expand production capacity in the U.S. after it announced a plan in November to invest up to $10 billion in the country over the next five years.

Toyota said in July it would spend $3.6 billion to bring production of its top-selling midsize pickup, the Tacoma, back to the U.S. by 2030. The company plans to build a second assembly line for the Tacoma at its San Antonio plant. Toyota currently builds the Tacoma in Mexico.

Making more vehicles in the U.S. will help Toyota, the world's top-selling automaker, defray a hefty tariff bill in its largest market.

The carmaker has been hit by the Trump administration's levies. Japanese autos are subject to a 15% tariff following a trade deal struck with Tokyo in July last year.

The yen's sharp depreciation in recent years has helped boost earnings for Japanese exporters, including Toyota, by making exports more competitive overseas and increasing the value of profits earned abroad in yen terms. The yen depreciated about 15% against the dollar over the past four years.

The Japanese carmaker on Tuesday recorded a 76% jump in first-quarter net profit to Y1.48 trillion, exceeding the Y978.49 billion estimate of analysts in a poll by data provider Quick. Revenue climbed 10% to Y13.53 trillion.

For the year ending March 2027, Toyota forecast revenue to increase 6.5% to Y54.00 trillion and net profit to fall 15.5% to Y3.25 trillion. It previously projected revenue of Y51.00 trillion and net profit of Y3.00 trillion.

Toyota maintained its annual group vehicle sales forecast of 11.18 million units.

--Junko Fukutome in Tokyo contributed to this article.

Write to Kosaku Narioka at kosaku.narioka@wsj.com and Ronnie Harui at ronnie.harui@wsj.com

(END) Dow Jones Newswires

August 04, 2026 06:34 ET (10:34 GMT)