Thank you very much for attending the fiscal year 2025 earnings presentation for Yamaha Motor Corporation. Before we move on into the presentation, I would like to introduce those who are attending. President and Chief Executive Officer, Representative Director Motofumi Shitara. Executive Officer and Chief General Manager of Corporate Planning and Finance Center, Mitsuru Hashimoto. Today, President Shitara will explain the business results and Executive Officer Hashimoto will give you the details by business segment. Then we will have a Q&A Zoom session for journalists and then analysts investors. The presentation material has been uploaded onto the Yamaha Motor corporate site.
I am Motofumi Shitara of Yamaha Motor Corporation. Thank you very much for attending our company's presentation. I would also like to thank you for your understanding and cooperation to our daily business operations. I would now like to go into the presentation of our business results.
First, starting with some key points. Please refer to page four. The 2025 results was down in terms of revenue and profit against the previous year and against the revised forecast, which we released in its second quarter announcement. It was a reduction in revenue but increase in profit. Operating income is moving as scheduled, but as a result of reviewing our recoverability of deferred tax assets, net income resulted lower than the revised forecast. Looking at the environment surrounding our company, the tariffs have pushed up costs, and especially the U.S. business environment has changed drastically. Therefore, in 2025 and onward, we have started our company-wide cost structure reform. In 2026, we believe that the tariffs will impact throughout the year. Therefore, through cost structure reform and price strategy, we will boost profitability.
In addition to this, in our core business, we will increase our sales unit and also with the improvement of profitability in strategic businesses, we are looking at a revenue of JPY 2.7 trillion, operating income of JPY 180 billion, an increase in revenue and profit. In terms of shareholders' return, 2025 results, we had a reduction in net income. Therefore, we have an annual dividend of JPY 35 in our plans. In 2026, we are expecting an increase in profit. Therefore, we are looking at an annual dividend of JPY 50 per share. With improved cash flow, we are hoping to have flexible acquisition of treasury stocks as well. Looking at the unit sales and inventory, please refer to page five. Left side, major products and total demand and unit sales is being compared against the previous year results.
Motorcycle throughout the year in Indonesia, Philippines, and Thailand, we have seen sound shipments. In Vietnam, Hanoi City announced ICE regulations, and because of that, demand was slightly down from last year. In October, we were hit by a flood. The factory was inundated and therefore shipment was down. However, we are working toward recovery and now, except for some products, production has normalized. Outboard motors. Continuing on from the third quarter in North America, small and mid-range models are moving steadily and shipments have gone up against the previous year. The right-hand graph looks at the market inventory versus the appropriate level. In India, last year in October, because the GST rates were lowered, retail has increased and temporarily, the inventory level has gone down. By spring, we are preparing so that production will normalize by then. Indonesia, Vietnam, Philippines, we are below the appropriate level of inventory.
However, we will be closely monitoring the supply and demand situation so that the inventory could be at an appropriate level. Looking at the business results, please refer to page six. 2025 results, revenue, 98% against the previous year at JPY 2,534.2 billion. Operating income, 70% versus the previous year, JPY 126.4 billion. Operating income ratio, - 2 points from the previous year at 5%. Net income attributable to owner of parent, 15% against the previous year at JPY 16.1 billion. EPS, 15% versus the previous year, JPY 16.59. The exchange rates used were JPY 150 against the dollar, JPY 169 against the euro. Looking at some factors impacting our operating income, please refer to page seven. As you can see, sales effects, -JPY 3.5 billion. Looking at the breakdown, scale effects, -JPY 7.3 billion. Financial services, +JPY 1.6 billion.
Price increase and rebate, which comprises pricing, + JPY 43.3 billion. Others, - JPY 41.1 billion. Net cost impact, - JPY 9.2 billion. Looking at the breakdown, cost reduction, + JPY 20.9 billion. Cost increases, - JPY 30.1 billion. R&D expenses have increased, - JPY 24.7 billion. SGA increase, - JPY 18.6 billion. Equity and earnings or losses of affiliates and land sale of Taiwan subsidiary, + JPY 20.3 billion. Forex impact, - JPY 6.1 billion, and tariff effect, - JPY 13.4 billion. Next, the environmental changes in 2025 and initiatives to be taken in 2026. Please refer to page eight. The U.S. tax-related cost increase, as well as the stagnating market, has caused major changes in U.S. business profitability structure from assumptions used for the midterm plan. U.S. tariffs in 2025 had an impact of JPY 17.1 billion. In 2026, we are looking at JPY 54.3 billion profit is being pushed down, and the economy is quite unclear.
Demand is weak, and the U.S. market sales is trending below our initial assumptions. Based on this, as I said at the outset, in 2025, we have started a cross-business cost structure reform. 2026, through these reforms, we will secure profitability, and we will establish a revenue structure for the mid to long term that is not reliant on top-line growth, and we will establish a strong company resilient to change. On the right-hand side, you can see some of the specific measures to be taken. Just like last year, market and competitors will be closely observed so that we can have appropriate price pass-through. In order to reduce costs, R&D, we will prioritize investment effects and postpone or halt model development appropriately.
Also in the U.S., we have water vehicle, RV, and LSM assembly factories, and we will try to reduce manufacturing cost by thoroughly reviewing our procurement costs. At the same time, the IT system introduction may be postponed to further reduce costs. Also, based on the changes in production and sales unit, we will adjust staffing level at the U.S. sites in order to reduce fixed cost, and also we will try to improve cash flow through improved asset efficiency. With the effect of this, we are looking at JPY 37 billion in 2026. Also OLV business and deficit, we will make a decision about making further investments or not in 2026, according to our midterm business plan. Considering the current situation, we will accelerate our review, and we will be able to explain our direction in August.
Based on these initiatives, this is our forecast for 2026. Please refer to page nine. For core businesses, increase in sales as well as price strategy and the cost structural reform, we will see an increase year-on-year in revenue and profit. Revenue 170% against the previous year at JPY 2,700 trillion. Operating income, 142% against the previous year, JPY 180 billion. Operating income rate, +1.7 point against the previous year, 6.7%. Net profit attributable to owner of parent, 621% against the previous year at JPY 100 billion. EPS, 621% versus the previous year at JPY 103.05. The exchange rates used is $155 against the dollar and EUR 175 against the euro. Some factors affecting the operating income in 2026, please refer to page 10. Sales effects, +JPY 108.1 billion, and that's a sales effect, +JPY 39.3 billion. Financial services, +JPY 8.4 billion.
Pricing, which is price increase and rebate, +JPY 24.2 billion. Others, JPY 36.2 billion. Net cost impact, -JPY 14 billion. The breakdown is cost reduction, +JPY 16.9 billion. Cost increase, -JPY 30.9 billion. R&D expenses will increase, so -JPY 10.5 billion. SG&A increase, -JPY 4.1 billion. Equity and earnings and losses of affiliates, +JPY 1 billion, and Forex impact, +JPY 10.3 billion. Tariff impact, -JPY 37.2 billion is expected. Next, looking at shareholder returns. Please refer to page 11. As announced on February 2nd, considering our business performance and financial soundness in 2025, year-end dividend is of JPY 10, annual dividend of JPY 35 is in the plan. 2026 dividend, based on our plan to increase profit, the annual dividend of JPY 50 per share is being planned. Also improvement of cash flow will be done, and we will also aim for flexible acquisition of treasury stocks.
Based on stable and continuous dividend process policy, we are aiming for a total payout ratio of 40%. We will continue to increase our corporate value and also return to shareholders. That is all from myself. Thank you very much.
My name is Hashimoto. I will be presenting information by business segment. This is the revenue and operating income by business segment. Please see page 13. In the motorcycle and financial services business segments, revenue was up and profit down. In SPV and robotics business segments, although revenue was down, operating losses were a lot less than prior year. Across marine products, OLV and other product business segments, revenue and profit were down. Next, the 2026 revenue and operating income forecasts by business segment. Please see page 14. From 2026, some segments have been changed. Up to now, robotics had included the UMS business segment. However, this has been transferred to other products. The FY 2025 numbers on this slide have been retrospectively amended in line with this change. For the 2026 forecast, motorcycle, marine, robotics, and financial services expect an increase in revenue and in income.
For SPV and OLV, revenue up and operating losses reduced. For other products, revenue down and operating losses reduced is our forecast. Now, each business segment in detail. Please see page 15. First, the core business segment of motorcycles. The graph on the left compares, in the upper half, the total demand in main regions and Yamaha Motor's prior year shipments. The lower half compares the 2026 forecast against prior year. The graph on the right shows the revenues by region. In 2025, although in Vietnam, the production and shipment stoppage had an impact, in Indonesia and the Philippines, the shipments increased, and revenue was the same level as prior year. In terms of operating income, rising procurement costs and increase in SGA costs, such as R&D and personnel costs, and the impact of U.S. tariffs resulted in a profit decrease.
In 2026, in the Philippines and India, our pursuit of the premium strategy to expand shipments and the recovery in Vietnam means we have planned for an increase in both revenue and profit. I'd like to introduce some new motorcycle products. Please see page 16. In November 2025, we announced in India the Yamaha Motor-developed electric sports scooter, the AEROX E, and in a collaborative development with Indian motorcycle startup River, the EC-06. The electric sports scooter, AEROX E, as part of our midterm plan, is one of our high value-added models in line with our premium strategy for ASEAN and emerging countries. In the field of EV, Yamaha Motor is aiming to build a premium image in the Indian market. The electronic scooter, EC-06, is based on River's production model and has been developed for a broader customer range.
With these products as the core, we will achieve our environmental targets and promote the capturing of EV demand. Next, the core business segment of marine products. Please see page 17. In 2025, in our main market, the U.S., with the impact of high prices and interest rates, the total demand was sluggish. In terms of our outboard motors, the small to medium brake horsepower mainly saw a growth in sales exceeding prior year. For outboard motors of 300 brake horsepower or more, the U.S. boat building demand was flat and sales reduced. For water vehicles, due to total demand reduction and increase in market inventory, the sales volume reduced. As a result, the marine products business segment as a whole saw a reduction in revenue.
In terms of operating income, with the impact of U.S. tariffs and reduced water vehicle sales volumes and cost increases through higher cost of sales and R&D cost rises, profit was reduced. For 2026, in terms of demand in the U.S., our main market, the reducing trend has bottomed out and is expected to remain flat. Growth is expected to continue in small to medium outboard motors and by aiming to expand sales of large outboard motors, leveraging new products for improved maneuverability, our forecast is a rise in revenue and profit. Next, robotics. Please see page 18. In 2025, although revenue was at the same level as prior year, implementation of sales measures with profitability in mind resulted in an improved marginal profitability for mounters and, in addition, reduced manufacturing expenses contributed to an increase in profit.
For 2026, as we continue a sales policy that views profit as critical, our forecast includes expanded generative AI-related demand and recovering demand for AI applications, and we expect an increase in revenue and profit. Next, financial services. In 2025, although revenue rose with an increase in retail receivables, the interest rate swap valuation gains in the prior period translated into losses in this period with great impact and profit was reduced. In 2026, in addition to increased retail receivables, the forecast is for a rise in profit due to improved gross profitability. Finally, SPV and OLV business segments. Excuse me. Please see page 19. First, SPV. Although domestic power-assisted bicycles have sold well, we have withdrawn from the overseas completed units business and therefore, the overall sales volume was down, as was revenue.
On the other hand, the inventory write-down and fixed asset impairment carried out last year have had an impact, and the operating losses have been reduced. In 2026, sales, both domestically and overseas, will grow with a forecast of increased revenue and profit. In Germany, from August last year, YMESG has been in operation and to create synergy, we will progress with building an organization structure. In OLV, for RV and LSM, there were reduced sales volume and increased R&D and SG&A costs, and by booking the fixed assets impairment that we had built in as a risk, revenue and profit were down. As was explained earlier, the cost structure review, as well as the improved asset efficiencies, will give a 2026 forecast of reduced operating losses. That ends the FY 2025 earnings presentation. Thank you for your attention.