Yamaha Stock Drops 10% After Earnings Report

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Investors at the Tokyo Stock Exchange were not happy with Yamaha Motor this morning, as the Japanese motorcycle manufacturer reported its 2010 earnings and 2011 forecast, and promptly saw its stock drop 10%. Despite managing to turnaround its 2010 income from the ¥216.1 billion ($2.5 billion) loss it took in 2009 to a profit of ¥18.3 billion ($219 million), Yamaha only expects to improve on these gains by just over 9% in 2011.

Yamaha’s return to profitability is due largely in part to the extensive cost-cutting measures that took place inside the company during the recession, as sales have only rebounded a modest 12% in 2010 over the 2009 numbers, and could not account for the massive turnaround in net income. For 2010 Yamaha is reporting ¥1.29 trillion ($15 billion) in sales, compared to the ¥1.15 trillion in sales for 2009, while operating income rose from a ¥62.6 billion loss in 2009 to a ¥51.3 billion operating profit in 2010.

Falling short of the Nikkei’s prediction of what Yamaha Motor would make in 2011, Yamaha is still showing signs of struggling with the new economy. Although sales have been strong for the tuning fork brand in developing Asian markets, a weak rebound in the US and Japanese markets have caused Yamaha concern.

We just think it’s pretty astounding that any motorcycle manufacturer can lose $2.5 billion in a year and still be in business.

Source: Capital FM via Bikes in the Fast Lane; Photo: © StéfanCreative Commons – Attribution-Share Alike 3.0 Unported

Jensen Beeler

Despite his best efforts, Jensen is called one of the most influential bloggers in the motorcycle industry, and sometimes consults for motorcycle companies, whether they've solicited his expertise or not.