Survey: Over 30% of Japan firms see profit drop for FY2025
SMBC Nikko Securities analyzed reports by 630 TOPIX-listed firms on the Tokyo Stock Exchange that had announced business results by Monday.
SMBC Nikko says the combined net profit of the 630 firms came to over 34 trillion yen, or about 230 billion dollars. That's up 4.3 percent from the previous year in yen terms.
For performance forecasts for fiscal 2025, the focus is on how much the impact of the US tariffs has been factored in.
SMBC Nikko says about 57 percent, or 359 firms, expect a net profit increase, while 35 percent, or 224, see a decline.
In particular, transport equipment sector companies, including automobiles, steel and marine transportation, project large drops. They cite higher costs and decreased trade due to the tariffs, among other factors.
The analysis says 7 percent, or 44 firms, have not disclosed their projections. Many say the effects of the levies are still unclear.
Yasuda Hikaru, chief equity strategist at SMBC Nikko Securities, says the impact on the real economy and corporate performance is yet to be quantified.
He said: "I think we'll be able to see more specific tariff impacts when mid-term results come out in September. So upgrades or downgrades to projections are still possible."
Yasuda says projections for now are not worse than expected despite the tariffs.
The combined net profit forecast among the 586 firms that announced projections is 7.5 percent lower than last year's figure.
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