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Nissan Q3 profit below expectations on yen strength, cost rise
[TOKYO] Nissan Motor Co posted on Thursday a weaker-than-expected operating profit for the third quarter as higher marketing costs and a stronger yen dampened earnings.
Japan's second-largest automaker posted an operating profit of 163.5 billion yen (US$1.46 billion) for the October-December period, down from 192.56 billion a year earlier and lower than a median forecast of 170 billion yen from nine analysts polled by Thomson Reuters I/B/E/S/.
The profit decline comes despite an improvement in domestic sales from a year earlier as a result of strong demand for the latest versions of its new Note compact hatchback and Serena van models which were launched last year.
Nissan has also enjoyed brisk sales in North America, particularly due to strong demand for its Rogue sport utility vehicle (SUV) in the United States. Sales have grown in China too, although the company has warned of slower sales there as tax breaks for small-engine cars are cut.
The average rate of the yen against the US dollar during the quarter was 109.4 yen compared with 121.5 yen in the same period in 2015, the company said. The rate against the euro was 117 yen compared with 133 yen.
Nissan left its full-year net profit forecast unchanged at 525.0 billion yen, while it maintained its expectations for operating profit at 710.0 billion yen, based on its forecast for the yen to average 105 yen to the US dollar and 120 yen to the euro.