Toyota sees blockbuster Q4, but bumpy road ahead

STORY: Toyota enjoyed a blockbuster fourth-quarter, but sees a bumpy road ahead.

On Wednesday, the Japanese automaker forecast a 20% profit decline in the current financial year.

It cited looming investment in both its suppliers and strategy for the projected drop-off.

Despite that, Wednesday's results smashed market expectations.

Operating profit surged 78% in the January-March quarter.

While Toyota made a profit of $34.5 billion for the full year.

It was the first time a Japanese company had reached more than 5 trillion yen - or just under $33 billion, according to local media.

Toyota has been boosted by a weaker yen.

It has also been a big winner from cooling demand for electric vehicles in some markets.

In the U.S. for instance, more customers have bought petrol-electric hybrids - which are Toyota's traditional strength.

Such vehicles made up more than a third of the 10.3 million cars it sold.

While battery-only EVs made up 1% of Toyota's global sales in the year just ended.

Toyota said it plans to invest almost $11 billion for growth this year in areas such as AI and software.

But the automaker also faces challenges in key markets such as China amid mounting competition from local rivals.