Toyota buoyed by strong hybrid sales, raises operating profit outlook by 4.3 trillion won

【Financial News, Tokyo—Correspondent Seo Hye-jin】Japan’s Toyota Motor Corporation raised its operating profit forecast for fiscal 2026 by 500 billion yen (about 4.25 trillion won) on the 5th, buoyed by strong hybrid vehicle sales and the yen’s depreciation. After also announcing plans to expand share buybacks and cancel treasury shares, its stock surged as much as 15% intraday.

According to the Nihon Keizai Shimbun (The Nikkei), Toyota said in its earnings announcement that consolidated operating profit for fiscal 2026 (April 2026 to March 2027) is expected to rise 4% year on year to 3.9 trillion yen (about 33.15 trillion won). This marks a shift from its previous forecast of a 10% decline to growth, and exceeds the market’s average estimate of 3.8548 trillion yen (about 32.7658 trillion won).
Toyota forecast revenue to rise 6% to 53.5 trillion yen (about 454.75 trillion won) and net profit to fall 7% to 3.57 trillion yen (about 30.345 trillion won). It lowered its revenue forecast from the previous outlook but raised its net profit forecast.
From April to September this year, revenue rose 9% to 26.9624 trillion yen (about 229.1804 trillion won), while net profit increased 26% to 2.2364 trillion yen (about 19.0094 trillion won).
Hybrid vehicles supported Toyota’s performance. From April to September this year, global sales, including Lexus, fell 4% to 5.05 million vehicles amid weakness in the Chinese market and other factors, but hybrid vehicle sales rose 8% to 2.36 million. In the United States, demand remained strong for fuel-efficient vehicles amid high inflation and the burden of gasoline prices.
Toyota’s North American sales rose 2% from July to September this year, buoyed by strong sales of hybrid sedan the Toyota Camry and SUV the Toyota RAV4, among other models. Over the same period, General Motors (GM) sales fell 5%, while Volkswagen’s fell 6%.
The yen’s depreciation also contributed to improved earnings. From April to September this year, the average exchange rate was about 159 yen to the dollar, up 13 yen from the same period a year earlier. Toyota forecast that cost improvements and the weaker yen would offset profit declines caused by the situation in the Middle East and rising material prices.

Toyota announced that it would raise its share buyback limit from 1 trillion yen (about 8.5 trillion won) to 1.3 trillion yen (about 11.05 trillion won). It also plans to cancel 1 billion treasury shares worth about 3.5 trillion yen (about 29.75 trillion won). As investors flocked to the stock following the raised earnings outlook and stronger shareholder returns, its price rose as much as 15% from the previous trading day’s close after the announcement at 1:55 p.m.
Toyota also announced an organizational restructuring to develop talent and strengthen its robotics business. It will establish a new education division, with Chairman Akio Toyoda also serving as its head effective January 1 next year and personally passing on his experience.
Toyota will also establish Toyota Robotics, a company-wide organization reporting directly to the company, to develop robotics as a key business for the future. Executive Officer Takafumi Shiga will also serve as its head.
Meanwhile, Toyota took a cautious stance on the U.S. midterm elections, in which the Democrats won a landslide victory.
Hiroyuki Ueda, head of External Affairs and Public Relations, said at a press conference that day, “This is a major change and will have a considerable impact,” adding, “It is difficult to predict what lies ahead.” Ueda stressed, “Even if the administration or policies change, we will make and supply cars that customers will continue to want to buy.”


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