Nissan Motor (7201) Q1 2026 earnings summary

Executive summary

• Q1 FY2025 retail sales declined 10% year-over-year to 707,000 units, with an operating loss of ¥79.1 billion, outperforming forecasts due to one-time gains and cost controls.

• The company is progressing with a recovery plan focused on profitability, free cash flow restoration by FY2026, cost reduction, product/market realignment, and partnerships.

• Over ¥30 billion in cost savings were realized in Q1 from fixed cost actions, including plant consolidations and workforce reductions.

• Negative automotive free cash flow of ¥390.5 billion, but liquidity remains strong at ¥2.1 trillion cash and ¥3.1 trillion total liquidity.

• Major bond issuances in July 2025 fully covered FY2025–26 debt maturities and supported investment in new products and technologies.

Financial highlights

• Q1 FY2025 operating loss was ¥79.1 billion, better than the guided loss of ¥200 billion, aided by a one-time warranty provision gain.

• Net income loss for the quarter was ¥115.8 billion; free cash flow was negative ¥390.5 billion.

• Consolidated net revenues were ¥2,706.9 billion, with core automotive revenues at ¥2,409.5 billion, impacted by lower volumes and a ¥200 billion FX effect.

• R&D expenses were ¥140.3 billion, slightly down from ¥147.9 billion year-over-year.

• Automotive gross cash position remains strong at over ¥2 trillion.

Outlook and guidance

• FY2025 retail sales forecast maintained at 3.25 million vehicles, down 2.9% year-over-year, mainly due to an 18% projected decline in China.

• Q2 FY2025 guidance: revenue of ¥2.8 trillion, operating loss of ¥100 billion, and free cash flow of negative ¥350 billion.

• FY2025 net revenue guidance at ¥12,500 billion, slightly below FY24 actuals; no dividend per share planned.

• Return to positive free cash flow expected in the second half of the year, supported by seasonal patterns.

• Full-year profit guidance remains undetermined due to uncertainty.