TOKYO – Japanese automotive giant Toyota Motor Corp. delivered a standout financial performance in the first quarter of its current fiscal year, with net profit almost doubling year-over-year, fueled by robust consumer demand across key North American and Asian markets and a favorable yen-dollar exchange rate that amplified overseas earnings for the exporter.
For the April-June quarter, Toyota, which produces the popular Prius hybrid line and premium Lexus brand, reported net profit of 1.48 trillion Japanese yen, equal to roughly $9.4 billion. That marked a sharp climb from 841 billion yen in the same three-month period a year earlier. Quarterly revenue also grew by 10% year-on-year to hit 13.5 trillion yen, or around $85 billion.
As one of Japan’s largest export-focused manufacturers, Toyota benefits disproportionately from a weaker yen relative to the U.S. dollar, since overseas revenue converts to more yen when repatriated to the company’s home base. During the 2025 fiscal first quarter, the dollar traded at roughly 145 yen, while this year’s corresponding quarter saw the dollar average around 160 yen. While recent joint currency intervention by U.S. and Japanese authorities in the second quarter has pulled the dollar back to around 158 yen, that shift came too late to impact the first quarter results. In total, favorable currency movements added 345 billion yen ($2.2 billion) to Toyota’s operating profit in the quarter, and the company has set its full-year forecast around an exchange rate of 160 yen to the dollar.
Notably, the company’s total global vehicle sales dipped slightly to 2.39 million units in the quarter, down from 2.41 million units in the prior year’s first quarter. Despite that small quarterly dip, Toyota remains optimistic about full-year volume, projecting it will sell 9.7 million vehicles across the 12-month period – an increase from 9.595 million units sold in the previous full fiscal year.
Toyota’s top leadership noted that ongoing strong consumer appetite for the company’s hybrid models has been a core growth driver across major global markets. In the U.S., two of the brand’s top sellers – the Camry midsize sedan and RAV4 compact SUV – continue to move off dealer lots at a brisk pace, while hybrid models including the Urban Cruiser and Innova Hycross have sustained high demand in India. The Yaris also maintains strong sales momentum in both Thailand and European markets, the company added. Toyota’s electric vehicle segment is also performing well, and the automaker has laid out long-term plans to ramp up production of both hybrids and hybrid batteries through 2030 while lowering production costs to improve accessibility.
Despite the strong quarterly results, Toyota is navigating a set of ongoing and emerging headwinds that could impact performance through the rest of the fiscal year. Ongoing political instability in the Middle East has created disruptions for Japanese automakers, which rely heavily on shipping routes through the Strait of Hormuz, which has been effectively closed amid regional tensions. Toyota officials confirmed the company is already taking steps to mitigate these risks, including securing alternative shipping routes to avoid the conflict zone.
More recently, a 7.1-magnitude earthquake that struck Kumamoto in southwestern Japan on July 28 has forced temporary production shutdowns at the company’s local facilities. Toyota’s Tahara plant has halted output for five days through the end of this week, and the shutdown will be extended through the end of July when the plant goes into a previously scheduled unrelated summer break, pushing all production offline through the end of the month. The full financial impact of the shutdown is still being assessed.
Looking ahead to the full fiscal year ending in March 2027, Toyota is projecting total net profit of 3.25 trillion yen ($20.6 billion), which is lower than the 3.85 trillion yen ($24 billion) profit the company recorded in the prior fiscal year. Full-year sales are forecast to climb to 54 trillion yen ($342 billion), up from 50.7 trillion yen in the 12-month period that ended in March this year. In response to the earnings release, Toyota shares declined by nearly 2% during trading on the Tokyo Stock Exchange Tuesday.