Toyota supplier Denso (6902.JP) reported an 11% decline in operating profit for the first fiscal quarter and raised its full-year revenue forecast, studying price increases to mitigate tariff impacts

Toyota (7203.JP) major supplier, Japanese auto parts giant Denso (6902.JP) announced its first fiscal quarter results ending in June, with revenue of JPY 1.75 trillion, roughly flat year-on-year. Operating profit fell 11.1% to JPY 107.2 billion. Net profit dropped 16.1% to JPY 79.3 billion.

The company raised its full-year revenue forecast for the year ending March next year by 2.1% to JPY 7.2 trillion (approximately USD 48.2 billion), while maintaining its full-year operating profit and net profit forecasts at JPY 675 billion (approximately USD 4.5 billion) and JPY 515 billion (approximately USD 3.4 billion) respectively.

The company indicated that U.S. tariffs impacted operating profit by JPY 12.5 billion (approximately USD 84 million) for the first fiscal quarter ending in June, with the full-year impact expected to be close to JPY 130 billion. However, the company anticipates that it can minimize the impact of tariffs through price increases and revised logistics arrangements.

Chief Financial Officer Yasushi Matsui stated that methods to cope with tariffs include producing in the U.S. where feasible and reassessing the logistics chain. When tariffs take effect, the company will discuss with customers how to mitigate costs. The U.S. and Japan recently reached a trade agreement, under which imported Japanese cars and parts will face a 15% tariff