Nissan Motor (7201) Q2 2025 earnings summary

Executive summary

• Net revenue for the first half was JPY 5.984 trillion, flat or down 1% year-over-year, with operating profit plunging 90% to JPY 32.9 billion and net income down 94% to JPY 19.2 billion; global retail sales fell 1.6% to 1.596 million units, with notable declines in China and Japan.

• Operating profit margin dropped to 0.5% from 5.6% year-over-year.

• Management is initiating a turnaround plan focused on cost reduction, organizational restructuring, and product competitiveness.

Financial highlights

• Operating profit for the first half dropped by JPY 303.8 billion year-over-year to JPY 32.9 billion, mainly impacted by negative sales performance, raw material costs, and inflation, partially offset by forex gains.

• Net income for the first half was JPY 19.2 billion; second quarter net income was negative JPY 9.3 billion.

• Free cash flow was negative JPY 448.3 billion, but net cash remained strong at JPY 1.36 trillion.

• CapEx increased to JPY 230.8 billion and R&D to JPY 295.7 billion in the first half.

• Liquidity remains strong with JPY 1,438.4 billion in cash and JPY 1,937.6 billion in unused credit lines as of September 30, 2024.

Outlook and guidance

• Full-year retail sales forecast revised down to 3.4 million units, a 6.8% decrease from previous guidance.

• Full-year revenue expected at JPY 12.7 trillion, with operating profit revised down to JPY 150 billion, JPY 350 billion lower than prior guidance.

• Interim dividend suspended; year-end dividend to be determined based on recovery pace.

• Net income guidance is TBD, with FX assumptions of 149 USD/JPY and 164 EUR/JPY for the remainder of FY2024.