Triple Profits
According to Subaru’s third-quarter financial report, the Japanese brand has earned triple its operating profit compared to the same period last year. The news comes as unexpected due to Subaru’s slipping U.S. sales and rising costs for materials.
So how did Subaru pull this off despite selling fewer cars? Well, consider it the universe throwing the brand a bone, as lower warranty claims and favorable exchange rates were able to cover Subaru for the time being.
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Selling Less
While Subaru caught a break this quarter, this is a one-time offset that countered the rising material and manufacturing costs the brand incurred last quarter. Operating profit is now at $466.4 million (¥73.4 billion), about triple the $167.1 million (¥26.3 billion) profit that the company reported for the same time last year.
That being said, Subaru is enjoying a net income of $336.1 million (¥52.9 billion) for this quarter, which is an increase of 49% over the $226.2 million (¥35.6 billion) the company earned at the same time last year, as stated by CFO Shinsuke Toda.
The odd one out in the report is global wholesale deliveries, which declined 2.2% to 224,000 vehicles. Sales also fell 10% to 151,000 vehicles in the United States, which should have dealt a big blow to Subaru since the U.S. accounts for 73% of the brand’s global volume. On the flip side, Canada’s Subaru sales increased by 73% to 26,000 units, accounting for a small but not insignificant bump for the brand. Despite those factors, the brand reported a modest 7.8% increase in revenue to $8.01 billion (¥1.26 trillion).
Wholesale deliveries declined because Subaru has been busy retooling its Yajima plant in Japan, which strained the company’s ability to deliver volume like before. With that being said, Japan sales declined 6.9% to 27,000 units, while Europe lost a massive 40%, down to 3,000 units.
On the Bright Side
Against all odds, Subaru was still able to achieve three times last year’s operating profits in the third quarter of 2026. This can be attributed to increased outlays for warranty provisions; in other words, lower warranty claims have proven favorable for Subaru, which gets those paid in dollars.
The global foreign exchange market is displaying a weaker yen as of late, but converting U.S. Dollars into Japanese Yen has turned out well in Subaru’s favor. This factor was enough to offset the negative impacts that rising raw material and fixed manufacturing costs brought to the table for Subaru.
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