Nissan is back in the black. The company reported Monday a net profit of 3.8 billion yen (about $24 million) for the quarter that ended in June, its first quarterly profit in two years. A year earlier it lost 115.8 billion yen. The turnaround is genuine but small: $24 million is roughly what this company spends before breakfast. Nissan sells three million cars a year. The profit is real; it is not yet a margin of safety.
Revenue tells the same story from the other side. Sales came to 2.96 trillion yen, up 9.5 percent from a year earlier, helped by cost cutting, a weaker yen, and one-time gains tied to last year’s US tariffs. The operating result swung from a 79.1 billion yen loss to a 77.9 billion yen profit. The restructuring plan, Re:Nissan, delivered 60 billion yen in savings in a single quarter. This is a company that cut its way back to profit, and cutting works until it stops working.
Two storms, still on the horizon
Chief executive Ivan Espinosa told reporters the cost reduction effort was gaining momentum, with sales growing in the US and Japan while difficulties remained elsewhere. The word elsewhere carries a lot of weight in that sentence.
China is the first storm. Nissan’s sales there have been squeezed by Chinese automakers who took the lead on electric vehicles and never gave it back. The company cut its global sales forecast for the year from 3.3 million vehicles to 3.15 million, and said plainly that China was the reason. It is spending its way into the Chinese EV market with new models and promising renewed growth from 2027. That is a promise to wait on.
The second storm is the war in Iran. The Strait of Hormuz, effectively closed since the fighting began, is a key route for Japanese exports to the Middle East, and Nissan’s sales in the region have suffered. The company lists geopolitical uncertainty in the Middle East among the external headwinds on its full-year outlook, alongside rising raw material costs. For a Japanese carmaker, the war is not a distant news story. It is a shipping lane, a sales region, and a line in the earnings report.
The bright spots, and the cracks in them
The US is the genuine good news. Nissan describes itself as the fastest-growing mainstream brand there over the past ten months, with sixteen consecutive months of year-over-year retail growth and sales up nearly 10 percent in the quarter. But the US market comes with tariffs. Washington’s initial 27.5 percent levy on Japanese cars was negotiated down to 15 percent, still six times the pre-Trump rate of 2.5 percent, and it shows up in material costs. The profit Nissan keeps is partly a function of what the US government lets it keep.
Japan is recovering on the back of new models, with strong order books for the redesigned Kicks and Elgrand. Then there is the earthquake. The magnitude 7.1 quake that hit Kumamoto last week partially stalled Nissan’s production lines, with no injuries and no damage to facilities, but the disruption is expected to last until Wednesday and cost about five thousand vehicles. In the scale of Nissan’s problems, that is a footnote, and the company treats it as one.
What the numbers really say
The full-year forecast is the honest measure: Nissan still expects a net profit of only 20 billion yen (about $127 million) on 13 trillion yen in sales, and it is sticking to that number. The company has been in the red for two fiscal years, its leadership promised a return to profit this year, and the first quarter delivered. Espinosa described the direction as clear, with the environment still challenging in China and the Middle East.
Nobody should mistake this quarter for the end of the crisis. The profit includes one-time gains, which by definition do not repeat. The sales forecast went down, not up. The two biggest external risks, the war at the Gulf and the price war in China, are unresolved, and either one can put Nissan back in the red before the fiscal year ends. The turnaround is real and it is narrow. Nissan has found a patch of calm in the storm, not the shore. That is the honest way to read 3.8 billion yen.
Source
- Japan Today (AP): Nissan sees profit for latest quarter but warns of Middle East and China woes
- Nissan Global Newsroom: Nissan posts Q1 results, reaffirms financial outlook
- Reuters: Nissan surprises with stronger first-quarter profit
- Quartz: Nissan Q1 2026 earnings: first quarterly profit in two years