Toyota Motor Corp. reported a near-doubling of quarterly profit, driven by strong vehicle demand in the United States and India alongside a favorable exchange rate that inflated the value of its overseas earnings.
The Japanese automaker recorded a net profit of 1.48 trillion yen ($9.4 billion) in the April–June period, up from 841 billion yen in the same quarter a year earlier. Quarterly sales climbed 10% year on year to 13.5 trillion yen ($85 billion).
A weaker yen proved central to the result. The U.S. dollar traded at about 145 yen during the same period last year but around 160 yen this year, boosting the value of repatriated foreign earnings for one of Japan’s largest exporters. The currency effect alone added 345 billion yen ($2.2 billion) to operating profit for the quarter.
The dollar is now trading at about 158 yen following a joint U.S.–Japan market intervention last week, which fell in Toyota’s fiscal second quarter. The company is assuming an exchange rate of 160 yen to the dollar for the full fiscal year.
Despite the profit surge, global vehicle sales dipped slightly. “Demand remains strong for Toyota hybrids in various global markets, including the U.S., where the Camry mid-size sedan and RAV4 compact sport utility vehicle are selling briskly,” Chief Officer Takanori Azuma said. Toyota sold 2.39 million vehicles in the quarter, compared with 2.41 million a year earlier.
The maker of the Prius hybrid and Lexus luxury models continues to face headwinds in China, where slowing sales have weighed on regional performance. The pressure mirrors challenges reported across the Japanese auto sector, with rivals such as Nissan flagging persistent difficulties in the Chinese market.
Even so, Toyota lifted its outlook for the year. The automaker now expects to sell 9.7 million vehicles across the full fiscal year, up from 9.595 million the previous year, with continued strength in hybrid demand underpinning the forecast.
Toyota plans to expand hybrid production to meet sustained appetite for the technology in key markets. The company has also been broadening its electric vehicle footprint, including new manufacturing capacity in Shanghai as it competes in China’s crowded automotive landscape.
The results underscore how currency swings and shifting regional demand are reshaping the fortunes of Japan’s export-driven manufacturers, even as competition in electric and hybrid vehicles intensifies worldwide.