TOKYO (AP) — Nissan raised its earnings forecast for the fiscal year after reporting a nearly 21 percent jump in quarterly profit as a cheap yen amplified strong overseas sales.
The Japanese automaker said Monday that sales were strong in the U.S. and Europe and the cheap yen boosted overseas revenue, offsetting a decline in its home market.
Nissan Motor Co., allied with Renault SA of France, reported a better-than-expected 101.8 billion yen ($856 million) net profit for October-December. Analysts surveyed by FactSet had expected about 83 billion yen ($697 million) in quarterly profit.
Quarterly sales surged about 17 percent to 2.94 trillion yen ($24.7 billion), which was also better than forecasts.
Yokohama-based Nissan, which makes the Leaf electric car, the Altima sedan and Infiniti luxury models, expects a 420 billion yen ($3.5 billion) profit for the fiscal year through March, marking an 8 percent rise year-on-year.
Previously, it had projected a 405 billion yen ($3.4 billion) profit.
The automaker raised its annual sales forecast to 11.15 trillion yen ($93.7 billion) from 10.8 trillion yen ($908 billion).
The weakening yen has lifted results at Japanese exporters such as Nissan.
Nissan said the dollar averaged 114 yen in the October-December quarter compared with 100 yen in the same quarter a year earlier.
Nissan Chief Executive Carlos Ghosn is calling it a "normalizing yen-dollar exchange rate," as he has repeatedly said the yen had been too strong.
"We anticipate good full-year results as our product offensive and positive momentum in North American and Western Europe offsets volatility in other markets," he said.
Nissan has also linked its brand power to electric cars. Although sales numbers are still few, at just 158,000 Leaf electric cars, cumulative around the world, the effort highlights Nissan's prestige in zero-emissions.
The automaker's other strength is its alliance with Renault.
Nissan is expecting to sell some 5 million cars and trucks globally this fiscal year. When combined with Renault global sales are estimated at 8.5 million vehicles, making the alliance a giant on the heels of Japanese rival Toyota Motor Corp., German automaker Volkswagen AG and General Motors Co. of the U.S.
Toyota, the world's top selling automaker, earlier raised its annual forecast after reporting third quarter profit jumped 14 percent, thanks to the weak yen.
Honda Motor Co., hit hard by a recall scandal involving Takata Corp. air bags, lowered its annual earnings forecast after quarterly profit slipped 15 percent due to recall expenses, despite the positive effect of the weak yen.