Toyota Motor (TM.US) will be on the list tomorrow: Analysts expect Q2 profit to increase 18% year over year, and is expected to achieve the first increase in six quarters

The Zhitong Finance App learned that Toyota Motor Corporation (TM.US) will release results for the second quarter (July-September) of fiscal year 2027 on Thursday. According to a survey of nine analysts (LSEG summary), the world's largest car company's operating profit for the quarter is expected to increase 18% year over year to 992 billion yen (about 6.3 billion US dollars), which is expected to achieve the first increase in six quarters; revenue is expected to increase 8% to 13.4 trillion yen.

Expected improvements mainly come from three aspects: the weakening yen, strong market demand for hybrid models with higher profit margins, and the absence of costs related to US tariffs, which dragged down performance in the same period last year.

There were mixed feelings at the sales level. Global sales of the Toyota and Lexus brands fell 4% during the quarter to slightly more than 2.5 million units. Among them, the Chinese market plummeted 22%, and the Middle East market fell by about one-third. However, in North America, sales of more profitable electrified models increased by more than 30% to nearly 430,000 units — although overall sales in the US market increased by less than 1%.

Marusan Securities analyst Yuya Takahashi said, “As gasoline prices rise, there is a demand for more fuel-efficient hybrid models. The key is how much of these more profitable hybrid models can actually be sold.”

The Chinese market remains the biggest concern for investors. As the world's largest automobile market, fierce competition from local Chinese brands and the rapid transformation of fuel trucks to electric vehicles are continuing to impact Toyota's model structure, which is mainly fuel-powered vehicles and hybrids. The pain on the supplier side is already evident: Denso Corporation (Denso), a member of the Toyota Group, announced last week that in the six months ending September, its operating profit in Asia fell by more than one-third, dragged down by weak vehicle sales in China and rising material costs.

Investors will also pay attention to Toyota's increasing investment in factory automation, in-vehicle software, and autonomous driving. Toyota itself estimates that starting in 2028, it may be necessary to invest 1 trillion yen a year to advance automation and robot deployment and modernize factories.