Toyota’s Quarterly Net Profit Falls 7%

Toyota Motor Corp. President Akio Toyota says he feels “a strong sense of crisis” after reporting the company’s net income declined 7% to 398 billion yen ($3.5 billion) in the fiscal fourth quarter ended March 31.

Operating profit for the period plunged 20% to 439 billion yen ($3.9 billion), as revenue climbed 7% to 7.4 trillion yen ($65.3 billion).

For the full fiscal year, Toyota’s operating and net incomes fell 30% to 2.9 trillion yen ($25 billion) and 21% to 2.3 trillion yen ($20.3 billion), respectively. Vehicle sales advanced 2% to 10.25 million units. But revenue for the 12-month period slipped 3% to 18.4 trillion yen ($161.5 billion).

The company offers a somber outlook for the current fiscal year, predicting flat unit sales and revenue. It expects its operating income will shrink another 20% to 1.6 trillion yen, and net income will fall 18% to 1.5 trillion yen.

In sports, President Toyoda notes, two years of declining results would be considered defeats. “I don’t like to lose,” he adds. Toyoda's sense of crisis about the company stems from worries about whether it is truly executing the carmaking function from the customer’s standpoint in everything from product development and production to sales and administration.

Toyoda says the company’s current financial results reflect Toyota’s determination to invest in future mobility technologies, even at the risk of reducing short-term profits. Still, he cautions that the company must decide “where to stop when sales are stagnating.”