Toyota Motor Corporation has reported a 3.5% rise in global revenues to JPY 12,253.3 billion in the first quarter of the current fiscal year (FY26), between April and June 2025, as vehicle sales rose by over 7% to 2.411 million units – driven mainly by strong growth in Japan and North America.

Operating profit declined by almost 11% to JPY 1,166.1 billion, which the company blamed mainly on adverse exchange rate fluctuations, higher material prices and cost-reduction expenses. Its operating margin fell to 9.5% from 11.1% a year earlier, while net income fell by 37% to JPY 843.1 billion. The company’s share price dipped by 2.4% in Tokyo on the news.

Toyota left its global revenue forecast for the full fiscal year (FY26), ending in March 2026, unchanged at JPY 48,500 billion, slightly higher than the JPY 48,037 billion achieved in the previous fiscal year (which ended in March 2025).

However, Toyota revised down its full fiscal-year operating profit to JPY 3,200 billion, from its earlier forecast of JPY 3,800 billion, due to adverse exchange rate fluctuations and the impact of higher material prices. The negative impact of the recent US import duties is expected to amount to JPY 1,400 billion.

Toyota’s operating margin is now expected to drop to 6.6% over the full fiscal year, compared with its previous forecast of 7.8%, and 10% in the previous fiscal year. The company said it plans to invest JPY 470 billion in the current fiscal year, while reducing costs and increasing its value chain profits.