Toyota lifted its full-year profit forecast by 10% today after posting its best quarterly operating profit in two years, boosted by a weaker yen and strong sales at home.
Japan's biggest car maker now expects operating profit to increase 10% on the year to 2.2 trillion yen ($20.23 billion), from 1.99 trillion yen a year earlier.
This marks an upgrade from its previous forecast of 2 trillion yen.
It said it expects net profit to come in at 2.4 trillion yen, up from a previous forecast for 1.95 trillion yen and on track for a record high.
For the third quarter, Toyota posted 673.6 billion yen in operating profit for the three months from October to December, a 54% jump from a year earlier.
The result exceeded a mean estimate of 527.22 billion yen taken from 11 analysts polled by Thomson Reuters I/B/E/S, and was its highest since October-December 2015.
Operating profit in Japan more than doubled as vehicle sales rose at home, while the car maker posted lower sales in North America, its biggest market, where it is struggling with heavy discounting as it tries to produce and sell larger vehicles.
Toyota sold 2.63 million vehicles globally in the three month period, up from 2.28 million the previous year.
Sales in Japan rose 3%, while sales North America fell to 735,000 from 745,000 units. Sales in Europe rose 1.7%.
Operating profit in North America tumbled 53.1%. Toyota has been struggling with rising marketing costs in the region amid steep discounting among automakers trying to sell more cars in the slowing US market.
Toyota has had a bumpy ride in the US, its biggest market where it trails only General Motors and Ford in terms of sales, as car makers continue to angle for higher market share as overall sales retreat from a record high hit in 2016.
Profitability in the US market is key for Toyota to help generate funds as it invests heavily in new technologies including self-driving functions, electric cars and new mobility services.
As US drivers continue to gravitate towards larger pick-up trucks and SUVs over sedans and hatchbacks, Toyota, best known for its Camry and Corolla sedans, has been scrambling to shift more production from cars to trucks.
Meanwhile, it has been selling its sedans at big discounts for much of 2017 to boost demand for models like the Camry, while also raising incentives on its SUVs and trucks to remain competitive in the US market.
This has lifted overall marketing costs per vehicle by 10% in 2017 from 2016.
