Honda Motor Company Ltd. (NYSE:HMC) shares are moving higher Friday following the company's third-quarter financial results and the announcement that it terminated merger discussions with Nissan Motor Co., Ltd.
What To Know: Honda reported earnings per share of ¥169.69 ($1.11) for the nine-month period, down from ¥176.78 in the same period a year ago, despite sales increasing 8.9% to ¥16.3 trillion. The company raised its full-year FY25 sales guidance by ¥600 billion to ¥21.6 trillion.
Key takeaways include:
- Honda reported an operating profit of ¥1,139.9 billion for the nine months ended December 31, 2024, with a 7.0% operating margin.
- Motorcycle sales exceeded 15.5 million units, while automobile sales fell by 297,000 units due to weak performance in Asia, particularly China.
- Fiscal year 2025 forecasts remain unchanged, with a projected operating profit of ¥1,420.0 billion and profit for the year of ¥950.0 billion.
- Honda revised its automobile sales guidance downward to 3.75 million units, while motorcycle sales guidance was adjusted upward to reflect record expectations.
- The company has acquired ¥184.9 billion in shares as part of a ¥1.1 trillion buyback plan.
Honda also confirmed it terminated merger discussions with Nissan. They companies were reportedly in disagreement over the proposed structure, which included shifting from a joint holding company to making Honda the parent company and Nissan a subsidiary. Instead, both companies will continue collaborating through a strategic partnership focused on electrification and intelligent vehicles.
Following the termination of the merger talks, Nissan may see new investment opportunities. Reports indicate that private equity firm KKR & Co. Inc. is planning to invest in Nissan, while Foxconn Technology Group has expressed interest in acquiring Renault's stake in Nissan as part of its broader EV manufacturing strategy.
HMC Price Action: Honda shares were up 2.56% at $28.67 at the time of writing, according to Benzinga Pro.
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