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Honda Slashes Profit Outlook 20%
Honda Motor Co. has cut its net income forecast for the fiscal year ending March 31 by 95 billion yen ($1.2 billion) to 375 billion yen ($4.7 billion) because of unfavorable exchange rates and lower-than-expected vehicle demand, particularly in China.
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Honda Motor Co. has cut its net income forecast for the fiscal year ending March 31 by 95 billion yen ($1.2 billion) to 375 billion yen ($4.7 billion) because of unfavorable exchange rates and lower-than-expected vehicle demand, particularly in China.
Honda trimmed its fiscal-year revenue outlook to 9.8 trillion yen ($123 billion) from 10.3 trillion yen. The company lowered its sales target to 4.12 million vehicles from 4.30 million units. That projection includes a 17% reduction to 620,000 vehicles in China, where anti-Japan sentiment is stifling demand.
Honda reported a net profit of 82.2 billion yen ($1 billion) in the fiscal second quarter ended Sept. 30 compared with 60.4 billion yen ($761 million) year earlier. Operating income quadrupled year over year to 276.8 billion yen ($3.5 billion).
Revenue jumped 20% to 2.3 trillion yen ($28.6 billion). Sales soared 47% to 996,000 vehicles as the company rebounded from last year's earthquake-impaired volume.
Honda's quarterly earnings were sharply lower than investors expected. Analysts say it could be a signal that other carmakers will report disappointing results in the days ahead.
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