Toyota Reports Q1 Earnings Fall Short Due to Rising Labor and R&D Costs

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Toyota Motor Corporation (TM) reported first-quarter fiscal 2027 earnings of $7.57 per share, missing the Zacks Consensus Estimate by 4.28%, but an increase from $4.47 in the same quarter the previous year. Revenues were nearly flat year-over-year at $84.9 billion. Consolidated cash and cash equivalents stood at ¥10.34 trillion ($64.34 billion) as of June 30, 2026, with long-term debt rising to ¥26.08 trillion ($162.3 billion) from ¥25.62 trillion as of March 31, 2026.

The Automotive segment posted net revenues of ¥12.01 trillion ($75.36 billion), a rise of 8.8% year-over-year, but operating profit fell 21% to ¥719.9 billion ($4.51 billion). The Financial Services segment saw a revenue increase of 23.2% to ¥1.4 trillion ($8.78 billion), while the All Other businesses generated net revenues of ¥469.9 billion ($2.94 billion), up 37% with a significant operating profit increase of 118% year-over-year.

For fiscal 2027, Toyota projects retail vehicle sales of 11.18 million units, a slight decline from 11.28 million units in fiscal 2026. Total sales are expected to reach ¥54 trillion compared to ¥50.68 trillion in fiscal 2026, but operating income is forecasted to drop by 9.7% to ¥3.4 trillion. R&D expenses are anticipated to rise to ¥1.6 trillion from ¥1.52 trillion in fiscal 2026.

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