Japan’s Toyota reports hefty profit on cheap yen and solid car sales

TOKYO (AP) — Toyota reported a nearly doubling of profit for the fiscal first quarter as solid demand in the United States and India combined with a favorable exchange rate to boost results.

The Japanese automaker, which makes the Prius hybrid and Lexus luxury models, recorded a $9.4 billion net profit in the April-June period, up from $5.29 billion the same quarter the previous year.

Quarterly sales rose 10% year on year to $85 billion.

A cheap yen raises the value of overseas earnings for Japan’s giant exporters like Toyota Motor Corp. The U.S. dollar was trading at about 145 yen during the fiscal first quarter in 2025, but at about 160 yen for the same period this year.

The dollar is now trading at about 158 yen because of a joint U.S.-Japan market intervention, which came recently, or in the fiscal second quarter.

The favorable currency effect added $2.2 billion to Toyota’s quarterly operating profit in the April-June period.

The automaker is figuring the yen at 160 to the dollar for the full fiscal year.

Chief Officer Takanori Azuma said Toyota sold fewer vehicles globally for the quarter just ended at 2.39 million, compared with 2.41 million vehicles a year ago.

But the automaker expects to sell more vehicles for the full fiscal year at 9.7 million vehicles, compared with 9.595 million the previous fiscal year.

Azuma said demand remains strong for Toyota hybrids in various global markets, including the United States, where the Camry mid-size sedan and RAV4 compact sport utility vehicle are selling briskly.

Toyota plans to boost hybrid and hybrid battery production through 2030, said Azuma, adding that it will bring down costs. Toyota’s electric vehicle sales are also going strong, he said.

Among the popular models in India were the Urban Cruiser and Innova Hycross, while the Yaris remained a strong seller in Thailand and Europe.

The recent political instability in the Middle East has weighed on Japanese automakers, which rely heavily on the now effectively closed Strait of Hormuz for shipping. Toyota said it was working on tackling such challenges, including finding alternative routes.

Toyota is projecting a $20.6 billion profit for the full fiscal year through March 2027, not as good as the $24 billion profit racked up the previous fiscal year.

Annual sales are forecast at $342 billion, better than the $318.85 billion for the previous fiscal year that ended in March.