Honda Motor Co., Ltd. Q4 FY2025 earnings call

• Financial results: Operating profit for FYE March 2025 was JPY 1.213.4 trillion; after one-time automobile warranty provision change, it was JPY 1.341 trillion. Operating cash flow after R&D adjustments was JPY 2.800 trillion. • Motorcycle business: World number one in market share, annual sales over 20 million units, low cost structure due to sharing platforms/powertrains. • Automobile business: Reduced hybrid electric vehicle system costs, current model profitability 1.5x previous, unit sales expanded in North America. • Dividend policy change: Switched to DOE, annual dividend increased from JPY 68 to JPY 70 per share.

Motorcycle business: Strong unit sales globally, achieved record highs in unit sales, operating profit, and operating profit margin. Automobile business: Unit sales declined mainly in China and ASEAN, impacted by increased North American incentives for EVs, but hybrid EV sales expanded. Motorcycle business revenue contribution: Not explicitly stated by percentage, but saw strong unit sales and profit growth. Automobile business: Impacted by sales decline in certain regions but hybrid EV sales expanded.

• For FYE March 2026: Minimum operating profit set at JPY 500 billion, net profit at JPY 250 billion. • Motorcycle business: Plans to sell 21.3 million units, an increase year-on-year. • Automobile business: Despite tariff impact, hybrid EV sales to be boosted mainly in North America.

• Tariff policies: Huge impact with frequent revisions making outlook difficult. • BEV market: Growth slowed down more than expected, leading to postponement of large-scale investments in Canada. • Human resources: Executive Vice President retired due to inappropriate conduct.

Q: About USMCA tariff and postponement in Canada?

A: Toshihiro Mibe explained tariff calculation details, including components and finished cars, and the reason for postponing Canada investment due to BEV market slowdown. Eiji Fujimura added on estimation assumptions and comparison with competitors.

Q: Questions from Yomiuri Newspaper about tariff disclosure and relationship with Nissan?

A: Toshihiro Mibe and Eiji Fujimura discussed intention to disclose tariff estimates for better internal and external understanding, and ongoing strategic partnership with Nissan focusing on collaboration rather than business integration.

Q: Questions from Asahi Shimbun about fiscal year outlook and motorcycle unit sales?

A: Toshihiro Mibe talked about profit outlook considering various factors and measures to recover, and motorcycle unit sales considering market conditions and competition.

Q: Questions from Toyo Keizai about profitability targets and human resources?

A: Eiji Fujimura and Toshihiro Mibe discussed profitability targets and BEV efforts, and addressed human resources changes with executive resignation and new allocations.

Q: Question from Binamisa about U.S.-Japan tariff negotiations?

A: Toshihiro Mibe stated desire for global free trade and support for USMCA to create a free business environment in North America.