Toyota Motor Corporation Q2 FY2021 earnings call

• Conveyed sympathy for COVID-19 impact and gratitude to customers/stakeholders. - Explained vehicle sales recovery from Q1 to Q2. - Discussed factors impacting operating income: foreign exchange (-¥120B), cost reduction (+¥50B), marketing activities (-¥970B), expense reduction (+¥115B). - Mentioned operating income recovery in regions despite COVID impact. - Talked about return to shareholders with interim ordinary dividend ¥100 and special dividend ¥5, no share repurchases. - Outlined full-year guidance: consolidated vehicle sales 7.5M units, Toyota/Lexus sales 8.6M units, sales revenue ¥26T, operating income ¥1.3T.

Consolidated vehicle sales for the first-half ended September 2020 were 3,086,000 units (66.3% of previous fiscal year's first-half). Toyota and Lexus brand new vehicle sales were 4,011,000 units (81.0% of previous year's first-half). Consolidated sales revenue was ¥11,375.2 billion, operating income ¥519.9 billion, pre-tax income ¥728.8 billion, net income ¥629.3 billion. China business: operating income of consolidated subsidiaries increased to ¥112.4 billion (+¥34.2B year-on-year), share of profit of equity method affiliates up to ¥79B (+¥15.5B year-on-year). Financial services operating income was broadly flat at ¥211.2 billion.

• Increased consolidated vehicle sales forecast by 300k units to 7.5M for full year. - Toyota/Lexus sales forecast increased by 300k units to 8.6M. - Full-year financials: sales revenue ¥26T, operating income ¥1.3T, pre-tax ¥1.76T, net ¥1.42T. - Operating income expected to be ¥1.3T, up ¥800B from initial forecast.

• Uncertainty from continued COVID-19 spread, including potential second/third waves. - Impact of regional lockdowns and virus spread on sales and operations.

Q: Appraisal of financial results, factors in upward revision, risk in second-half, supply chain coordination A: Discussed recovery in operating income from Q1 to Q2, factors like marketing expenses, expense reductions, and supply chain efforts Q: Breakdown of operating income factors, second quarter special factors A: Explained marketing activities impact, expense reduction details, swap valuation gains/losses Q: CapEx increase, R&D expenses, U.S. presidential election impact A: Explained CapEx increase reasons, R&D shift, minimal impact from election outcome Q: U.S. sales performance, inventory levels, supplier concerns A: Talked about U.S. sales recovery, inventory tightness, supplier communication Q: Supplier concerns, cost reduction efforts A: Discussed close supplier communication, cost reduction targets