Toyota’s Q1 earnings miss expectations on weaker production and sales Author: Investing.com

Investing.com– Toyota Motor Corp. on Thursday reported slightly weaker-than-expected second-quarter profit as the Japanese auto giant grappled with production disruptions and a drop in global demand further dragged down sales.

Toyota (NYSE:) (TYO:) operating income rose 30% to 1.31 trillion yen ($8.7 billion) in the three months through June 30, slightly below Bloomberg estimates of 1.32 trillion yen.

The world’s largest automaker by sales saw its overall sales rise 12.2 percent to 11.84 trillion yen as falling demand for electric vehicles boosted sales of hybrid models, a sector the company pioneered more than two decades ago.

But sales momentum slowed significantly after a surge in hybrid sales drove the automaker to record revenue through fiscal 2024. Production disruptions caused by the ongoing safety scandal and a mass recall of more than 100,000 vehicles due to engine problems also weighed on the automaker’s financial results.

Still, the automaker benefited from other cost-cutting measures, and a weak yen also benefited the company throughout the quarter.

Toyota’s production volumes fell for a fifth straight month in June as a safety-testing scandal spread beyond the automaker’s Daihatsu unit after Japanese authorities uncovered irregularities in the certification of some models. The company and several of its rivals were ordered to halt deliveries of the models in question.