Toyota Reports $1.7B Quarterly Profit
Toyota Motor Corp., grappling with spreading safety problems that are battering its image, returned to profit in the October-December quarter and raised its annual earnings forecast.
The world's No. 1 automaker Thursday reported a quarterly net profit of 153.2 billion yen ($1.7 billion) and cited stronger sales of the Prius and other "green" models. It reported a 164.7 billion yen loss a year earlier.
The earnings report came out just hours before a Toyota official conceded that the newest version of the Prius, which went on sale in May in the United States, had a design flaw in its antilock braking system.
The earnings results don't reflect the damage from the massive recalls linked to faulty gas pedals, announced Jan. 21. But the suspension of U.S. sales of eight of its most popular models and repair costs are expected to undermine earnings in the current quarter.
The Prius is not part of the recalls involving gas pedals, but Japan's finance minister has strongly urged the company to investigate the matter, and suggested a new recall might be necessary.
Read more about the Toyota recall at CBSNews.com:
Toyota Admits Prius Brake Problem
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Toyota Dealers Get $75K to Win Back Buyers
LaHood: Stop Driving Recalled Toyotas
Ray LaHood Comments Show Toyota Owners' Conundrum
Toyota Prius Drivers Voice Brake Concerns
LaHood: Toyota Resisted Safety Fix
Analyst: Recall Costs Toyota $155M a Week
Does Toyota's Problem Go Beyond Pedals?
Toyota: New Pedal Parts on Way to Dealers
Still, Toyota raised its annual earnings forecast and expects to be back in the black after losing money last year. It now expects a profit of 80 billion yen for the year through March from an earlier projection of a 200 billion yen loss.
It also lifted its full-year vehicle sales forecast slightly to 7.18 million units from 7.03 million - although that's lower than the 7.57 million vehicles it sold last fiscal year.
For the quarter, sales revenue rose 10 percent to 5.3 trillion yen, it said in a release.
Toyota is in the midst of recalling nearly 4.5 million vehicles in the U.S., Europe and China to fix a sticky gas pedal, which follows a previous recall late last year involving floor mats that can get jammed in the accelerator. Together, the recalls total 7 million vehicles worldwide, although some models are affected by both problems.
Toyota shares continued to tumble on the Tokyo Stock Exchange, falling 3.5 percent to 3,280 yen after plunging 5.7 percent the previous day. Since Jan. 21, the day the gas pedal recall was announced, the stock has tumbled about 22 percent.