Nissan Motor reported a net profit of ¥3.8 billion for the three months ended June 30, its first quarterly profit in two years, as cost reductions and improved sales in several key markets offset ongoing headwinds in China and the Middle East.
The Japanese automaker posted a ¥3.8 billion net profit for the April–June quarter, reversing a ¥115.8 billion loss from a year earlier
Credit: Nissan
Nissan Motor reported a net profit of ¥3.8 billion for the three months ended June 30, its first quarterly profit in two years, as cost reductions and improved sales in several key markets offset ongoing headwinds in China and the Middle East.
That compares with a ¥115.8 billion net loss posted in the year-ago quarter. Quarterly revenue came in at ¥2.964 trillion, a 9.5% increase from ¥2.707 trillion in the prior-year period. Operating profit returned to positive territory at ¥77.9 billion, compared with an operating loss of ¥79.1 billion in the prior-year period, the company said. One-time gains related to U.S. tariffs also contributed to operating profit.
The turnaround was driven by Nissan's Re:Nissan restructuring plan, which generated approximately ¥60 billion in first-quarter savings, primarily through variable cost reductions across manufacturing, purchasing, and research and development, the company said.
"The environment remains challenging, particularly in China and the Middle East, but our direction is clear," Chief Executive Ivan Espinosa said in a statement. "We are managing disruption where it exists, building momentum where we see opportunity."
In the U.S., Nissan said sales grew nearly 10% in the quarter, with the company describing 16 consecutive months of year-over-year retail sales growth. In Japan, new models including the Kicks and Elgrand have drawn early orders. China remains a drag, with fierce competition from domestic electric vehicle makers weighing on performance, the company said.
Nissan trimmed its annual global sales target to 3.15 million vehicles, down from a prior projection of 3.3 million, pointing to persistent weakness in the Chinese market. The company kept its financial outlook unchanged, projecting full-year revenue of ¥13 trillion and net profit of ¥20 billion, the company said.
The restructuring effort has included selling its headquarters and reducing manufacturing capacity, according to The Wall Street Journal. Nissan has also said it will cut 20,000 jobs over the four years through March 2028.
Japan's automotive sector is also navigating U.S. tariffs on imported vehicles. Talks between the two governments brought the tariff on Japanese vehicles down to 15% from a peak of 27.5%, though that level still far exceeds the 2.5% rate that had previously applied, according to the Associated Press. Rising raw material costs present an additional challenge, Nissan said.
Espinosa told reporters that a magnitude 7.1 earthquake that struck Kumamoto, Japan, last week had interrupted output at some facilities, with roughly 5,000 vehicles expected to be affected by the slowdown, according to the Associated Press. No employees were hurt and no facilities were damaged, Espinosa said.
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