Profit statements

Nissan raises net profit forecast again despite chip shortage

Nissan’s upbeat outlook comes despite a semiconductor shortage that has hit automakers around the world – Copyright AFP Kazuhiro NOGI

Nissan raised its full-year net profit forecast again on Tuesday on the back of strong quarterly results, in a bid to tackle a global chip shortage as it focuses on electric vehicles.

The Japanese auto giant now expects annual net profit through March 2022 of 205 billion yen ($1.77 billion), having already tripled its annual profit outlook in November to 180 billion yen.

Its upbeat outlook comes despite a semiconductor shortage that has hit automakers around the world, and which analysts warn could take longer than expected to resolve.

It also follows a series of trials for Nissan, which has faced problems in recent years including weak demand and the fallout from the arrest of former boss Carlos Ghosn.

“While the sales volume forecast for fiscal 2021 remains unchanged at 3.8 million units, the severe shortage of semiconductors and the increase in Covid-19 infections due to the spread of the Omicron strain affect plant operations,” the company said in a statement.

“Despite these challenges, Nissan has revised its full-year outlook upwards due to further improvement in performance driven by improved sales quality and cost optimization, continued depreciation of the yen and a review of the impact of rising commodity prices.”

Nissan posted a net profit of 32.7 billion yen in October-December 2021, compared to a net loss of 37.8 billion yen in the same period a year earlier when virus lockdowns hit the auto market.

However, third-quarter revenue fell slightly to 2.2 trillion yen. The company’s nine-month consolidated results showed year-over-year increases in revenue and net profit.