Honda's 2025 Q4 Earnings Call: Navigating Tariff Challenges and Electric Vehicle Strategies Amid Contradictions

Tariff impact and business optimization strategies, electric vehicle strategy and market outlook, tariff impact and production optimization strategies, electrification strategy and market focus are the key contradictions discussed in Honda's latest 2025Q4 earnings call.



Motorcycle Business Performance:
- Honda's motorcycle business reported a record operating profit of JPY 663.4 billion, up 107.2 billion year-on-year.
- The growth was driven by strong unit sales globally, achieving record highs, particularly in Asia.

Automobile Business Challenges:
- The automobile business experienced a decline in unit sales, particularly in China and ASEAN, impacting operating profit.
- The decline was attributed to increased North American incentives for EVs and a reduction in unit sales in China.

Operating Profit and Financial Outlook:
- Honda's operating profit for the fiscal year ended March 2025 was JPY 1.213.4 trillion, and for FYE March 2026, a minimum of JPY 500 billion is projected.
- The decline in profit was due to changes in accounting methods and the impact of tariff policies on international trade.

Dividend and Shareholder Returns:
- The company announced a change in dividend policy, increasing the annual dividend to JPY 70 per share from JPY 68, focusing on stable shareholder dividends.
- The decision was made to improve capital efficiency and ensure stable returns amid uncertainties.