Nissan raises 2027 profit outlook

Nissan Motor used its May 13 earnings release to put a number on the first full year of its turnaround: 200 billion yen in operating profit for the fiscal year ending March 2027. The forecast came in above analyst expectations and followed a year in which the company said cost controls helped it post 58 billion yen in operating profit, even as net income stayed deeply negative because of restructuring charges. Nissan shares in Tokyo closed up 4.26% on May 13 at 364.40 yen after the update. The company framed the forecast as an early result of its Re:Nissan recovery plan, which was unveiled in May 2025 under Chief Executive Ivan Espinosa. That plan targets 500 billion yen in total fixed and variable cost savings versus fiscal 2024, a workforce reduction of 20,000 and a cut in plants to 10 from 17 by fiscal 2027. Nissan has also said it wants positive automotive operating profit and positive free cash flow by the end of fiscal 2026, excluding the impact of tariffs. (global.nissannews.com) ### How much did Nissan actually raise the bar? The May 13 outlook set operating profit at 200 billion yen for fiscal 2026, the year that ends in March 2027. Bloomberg reported that analysts had been looking for 119 billion yen, making Nissan's target materially higher than consensus. Reuters separately reported that some analysts had expected a loss for the year just ended, underscoring how closely investors were watching the company's cost line. (global.nissannews.com) Nissan's own release showed why the comparison mattered. The company posted 58.0 billion yen in operating profit for fiscal 2025 on revenue of 12.0 trillion yen, with operating margin at 0.5%. Net income remained negative at 533.1 billion yen, reflecting restructuring costs, but fourth-quarter operating profit improved to 68.1 billion yen from 5.8 billion yen a year earlier. (bloomberg.com) ### Which cost cuts are supposed to get Nissan there? Nissan's recovery plan splits the savings target evenly between variable and fixed costs. The company said it is pursuing 250 billion yen of variable-cost reductions through engineering efficiencies, supply-chain optimization and sourcing changes, and another 250 billion yen of fixed-cost reductions by consolidating production, streamlining vehicle and powertrain operations and reprioritizing development work. (global.nissannews.com) A supplier overhaul is part of that effort. Nissan said in its Re:Nissan materials that it will restructure its supplier panel to direct more volume to fewer suppliers, which it said would remove inefficiencies and challenge legacy standards. The company also said a cross-functional transformation office with about 300 experts had been set up to make cost decisions, while 3,000 people were reassigned to cost-reduction initiatives after product work was reprioritized. (global.nissannews.com) ### Why did investors react on the day? Tokyo trading on May 13 reflected the gap between Nissan's forecast and market expectations. Nissan shares closed at 364.40 yen, up 14.90 yen, or 4.26%, according to Bloomberg and Financial Times market data. Bloomberg linked the move to a profit outlook that came in above consensus as investors looked for evidence that the restructuring was beginning to show through in reported numbers. (global.nissannews.com) The earnings release added another data point that investors could point to. Nissan said automotive free cash flow turned positive in the second half of fiscal 2025 and reached 112 billion yen, while automotive net cash stood at 1.17 trillion yen at year-end and total liquidity was 3.6 trillion yen. ### What still stands in the way of the turnaround? Reuters reported that Nissan said the business environment remained difficult because of competition, foreign-exchange swings, inflation and geopolitical risk. (markets.ft.com) The company said U.S. tariffs reduced profit in the past financial year by 286 billion yen, and it estimated the Iran war would trim the current year's operating-profit outlook by less than 15 billion yen in the first half. (global.nissannews.com) Julie Boote of Pelham Smithers Associates told Reuters that the broader economic effect of the conflict, especially in Asia, could be the larger risk for Japanese automakers. That assessment was hers, not Nissan's, but it captured the outside view that cost cuts alone may not settle the question if demand weakens. ### Where do readers look next for proof the plan is working? (money.usnews.com) Nissan's investor-relations calendar lists the May 13, 2026 full-year results release as the latest formal update and shows that the company posts subsequent sales, production and financial notices on its IR events page. The next proof points are likely to come through those scheduled disclosures, including monthly operating data and the next quarterly earnings release. (nissan-global.com) (money.usnews.com)