Toyota Motor (7203)

Research evidence excerpt

Toyota Motor (7203)

J P M O R G A N Asia Pacific Equity Research

04 August 2026

1Q results: Not bad given uncertain business Overweight

environment; positive impression of ¥1 trillion share 7203.T, 7203 JP

buyback Price (04 Aug 26):¥2,919

Price Target (Dec-26):¥4,100

Somewhat positive: 1Q operating profit of ¥1.06 trillion fell slightly short of our Japan Equity Research

estimate, but beat our estimate in real terms when excluding accounting and one-

Autos & Auto Parts

time factors, so we believe 1Q was a solid start to FY2026. 1Q shipment volume

was somewhat disappointing, but we expect a recovery from 2H. Management Akira Kishimoto AC

slightly raised full-year operating profit guidance from ¥3.0 trillion to ¥3.4 trillion, (81-3) 6736-8646

akira.x.kishimoto@jpmorgan.com

mainly to reflect forex impact, but we see ample leeway for overshooting. Toyota

Wencong Zhang

Motor also announced a share buyback of up to ¥1 trillion separate from any action (81-3) 6736-8627

related to cross-shareholdings with P&C insurers; it is thus a pure share buyback wencong.zhang@jpmorgan.com

for up to 4.2% of outstanding shares, which we view positively as it represents JPMorgan Securities Japan Co., Ltd.

capital policy progress aimed at improving ROE.

• Decent start amid uncertain business environment: 1Q operating profit of

¥1.06 trillion fell slightly short of our ¥1.18 trillion estimate, but we estimate

that operating profit in real terms was close to ¥1.3 trillion when factoring in

recognition of unrealized inventory gains/losses due to yen depreciation at

end-1Q (-¥248.3 billion) and other factors like losses related to the ending of

BEV model development. We thus feel 1Q profit represents a decent start to

FY2026 given the situation in the Middle East and other business environment