Five Lines Below Operating Profit

Nissan Motor's consolidated statement of income for the year ended March 31, 2026 prints operating profit of ¥58,005 million (US$354 million) near the top and, near the bottom, a net loss attributable to owners of the parent of ¥533,095 million (US$3.25 billion). The middle profit line comes from the earnings summary: ordinary profit, ¥1,081 million (US$6.6 million). The bulk of the distance between operating profit and the net loss is one section of the form: special losses, ¥576,838 million (US$3.52 billion). This piece is about what sits in that section, item by item, as the company printed it.

The securities report was filed on June 22, 2026 — the date the filing itself stamps on its forward-looking judgments — covering the 127th fiscal term. Revenue was ¥12,007,888 million (US$73.3 billion), down ¥625.3 billion (US$3.82 billion), or 4.9 percent, attributed by the company mainly to lower unit sales. Operating profit fell 16.9 percent; the filing says most of the US tariff and currency effects were offset by cost-reduction activity. The net loss narrowed by ¥137.8 billion (US$841 million) from the prior year's ¥670,898 million (US$4.10 billion).

The same form was filed a year earlier. The 126th-term securities report, covering April 1, 2024 through March 31, 2025, lists in its contents the same headings this piece walks: 連結損益計算書, 従業員の状況, (5)所有者別状況 and (6)大株主の状況, 報告セグメントごとの固定資産の減損損失に関する情報, and 連結キャッシュ・フロー計算書. The part of that document reviewed for this piece is the contents list, and the amounts do not appear in it. The prior-year figures quoted here — the net loss, the employee count, the cash-flow movement — are read from the 127th-term filing's comparative columns, where the same series prints a second time on the newer form.

The plan announced in May 2025 is called Re:Nissan. The name appears elsewhere in the filing — the audit committee's priority audit items list plant closures, workforce reductions and cost cuts under it — but the income statement does not use it. The statement's special-loss section speaks Japanese GAAP's standard vocabulary, in five lines: impairment loss, ¥366,247 million (US$2.24 billion); special retirement allowances (tokubetsu taishoku kasankin), ¥85,048 million (US$519 million); loss on disposal of fixed assets, ¥21,610 million (US$132 million); loss on sale of fixed assets, ¥3,793 million (US$23 million); and other, ¥100,140 million (US$611 million). The five sum to ¥576,838 million.

The impairment note states its own trigger: continued operating losses gave rise to indications of impairment in certain asset groups, tests were run, and book values were written down to recoverable amounts. Assets are grouped by business segment — automotive and sales financing — and by regional units reflecting mutual complementarity, per the note on estimates. The ¥366.2 billion divides into two kinds of asset: business-use assets of the automotive segment, ¥240,122 million (US$1.47 billion), and idle and similar assets, ¥126,125 million (US$770 million). The two parts sum to the whole: 240,122 + 126,125 = 366,247.

The heading over that number is not the company's wording. 固定資産の減損に係る会計基準, issued by the Business Accounting Council on August 9, 2002 and stated there to be implemented for fiscal years beginning on or after April 1, 2005, provides that an impairment loss shall as a rule be recorded as a special loss. That is the sentence that puts the largest of the five lines in the section it is in. The same standard supplies the note's other terms. Among its examples of an indication of impairment: that operating results or cash flows from the activity in which an asset or asset group is used have been continuously negative, or are expected to be. Grouping is to be done at the smallest unit generating cash flows largely independent of those of other assets or asset groups. Recoverable amount is the higher of net selling price and value in use — net selling price being fair value less estimated disposal costs, value in use the present value of the future cash flows expected from continued use and subsequent disposal.

The business-use portion has a geography. North America took ¥154,840 million (US$945 million), plus a further ¥15,825 million (US$97 million) on assets under lease contracts as lessor; the note says the impairment includes losses on leased vehicles, reflecting falling used-vehicle prices after the repeal of the US federal EV tax credit. Europe took ¥47,088 million (US$287 million), Japan ¥22,369 million (US$137 million). The pieces reconcile: 154,840 + 15,825 + 47,088 + 22,369 = 240,122.

The other ¥126.1 billion is sorted by expected fate rather than by place: ¥68,139 million (US$416 million) on idle assets not expected to be used, ¥2,514 million (US$15 million) on assets expected to be sold, and ¥55,472 million (US$339 million) on assets expected to be disposed of, each judged asset by asset. Again the sum closes: 68,139 + 2,514 + 55,472 = 126,125. This is the ledger point at which a building stops being carried as productive capacity and becomes a question of recoverable amount.

The standard also names the categories the note sorts by fate. For idle assets whose future use is undetermined, future cash flows are to be estimated on the basis of the present situation; and disposing of an asset or asset group significantly earlier than originally planned is given as an example of a change that markedly lowers recoverable amount. Its disclosure article asks, where a material impairment loss has been recognised, for the assets impaired, the circumstances leading to recognition, the amount, the method of grouping, and the method of computing recoverable amount. A breakdown by region, or by use, is not among the enumerated items in the text reviewed here; nor, in that text, is an instruction to judge idle and disposal-bound assets one asset at a time.

The plant arithmetic itself sits in other chapters. The stated plan is 17 vehicle plants down to 10 by fiscal 2027, with global production capacity cut by one million units; seven sites have been designated, and the filing's capital-expenditure section says six of the seven consolidations are scheduled to complete within fiscal 2026. The English results release puts it as "Execution across seven sites is underway, including production transfers." Production in the year just ended was 2,155,562 vehicles, down 253,017 units, or 10.5 percent.

The personnel side of the turn has one special-loss line — the ¥85,048 million (US$519 million) of special retirement allowances — and one separate table. Re:Nissan's announced target is a reduction of 20,000 people over fiscal 2024 through 2027, including 9,000 announced earlier, across production, administrative and R&D functions. The filing's employee table, a standard disclosure rather than a plan metric, shows consolidated employment of 120,079 at March 31, 2026 against 132,790 a year earlier — a decline of 12,711 (132,790 − 120,079). The English release's Re:Nissan Progress section carries no headcount figure; the count lives in the statutory table.

The vocabulary shifts as the documents get shorter. The statement of income says special losses and itemizes five lines. The earnings summary's narrative compresses the same territory into a net special-items loss of ¥441.5 billion (US$2.70 billion) — gains offset against losses — which sits roughly ¥135.3 billion (US$826 million) below the gross special-loss total (576.8 − 441.5 = 135.3). The phrase restructuring costs appears in neither the summary excerpts reviewed for this piece nor the Japanese results release; the English release, per the same review, uses neither the term restructuring costs nor the term impairment loss. Each document keeps to its own register.

The shorter document sits on a different rulebook. A listed company must disclose the content of its results immediately once determined — for the fiscal year, the interim period and the quarterly cumulative period — and the Tokyo Stock Exchange asks that the 決算短信 and quarterly 決算短信 be prepared and disclosed in accordance with the reference forms it publishes, of which the full-year No. 1 reference form is the one marked 【日本基準】(連結). The exchange's page carrying those forms and their preparation guidelines shows a July 2026 edition and an update date of July 22, 2026, and describes a past revision of the forms and required items as made to raise the degree of freedom in disclosure. The column structure of the summary itself is not set out on that page in the material reviewed here; the page carries the forms and the request to use them.

Two changes in accounting estimates run through the same year, and the notes print their effect. Citing Re:Nissan, the company extended the maximum useful life of internally used software from five years to eight, which increased operating profit by ¥11,068 million (US$68 million). It also changed the method for the product warranty provision — from referencing vehicles whose warranty period had expired to referencing recent warranty costs including vehicles still under warranty — which increased operating profit by ¥36,603 million (US$223 million). Together: 11,068 + 36,603 = ¥47,671 million (US$291 million), figures the notes state alongside a printed operating profit of ¥58,005 million.

The cost-reduction ledger runs on plan metrics — figures whose scope and accounting definitions none of these documents state. The May 2025 announcement set ¥500 billion (US$3.05 billion) of reductions by fiscal 2026 against a fiscal 2024 base — ¥250 billion (US$1.53 billion) each from fixed and variable costs. For fiscal 2025 the company reports roughly ¥200 billion (US$1.22 billion) of fixed-cost reduction achieved and roughly ¥55 billion (US$336 million) of variable-cost reduction. The filing separately counts more than 5,000 improvement proposals with an expected effect of ¥270 billion (US$1.65 billion) — a category the document distinguishes from achieved reductions.

The same two phrases — fixed-cost reduction, variable-cost reduction — reappear in the executive bonus scorecard, scored on their own scale. Fixed-cost reduction came in above target, at 11.5 percent achievement against a 10 percent weight. Variable-cost reduction scored 0.0 percent, below target, in the same year the release reports ¥55 billion of variable-cost reduction achieved. The printed explanation is definitional: the table notes that its cost metrics use definitions different from those in the financial statements, and some metrics are measured excluding tariff effects. The CEO's total bonus achievement was 84 percent; other executive officers ranged from 81.6 to 96.3 percent; and the notes record that Ivan Espinosa returned 50 percent of his annual bonus, with the printed amounts already net of that return.

The cash-flow statement then re-sorts the year by whether money moved. Operating cash flow was ¥794,674 million (US$4.85 billion), up ¥41.0 billion (US$250 million), attributed to improved working capital; investing outflow was ¥914,301 million (US$5.58 billion), reduced in part by higher proceeds from fixed-asset sales. The ¥366,247 million impairment reappears in operating cash flow as an add-back: the write-down involved no cash this year. Among the asset sales was the head-office land and building in Nishi-ku, Yokohama, sold in a sale-and-leaseback at a book value of ¥23.0 billion (US$140 million).

The company's own management metric slices the same cash a different way: automotive free cash flow was negative ¥480.8 billion (US$2.94 billion) for the full year and positive ¥112.0 billion (US$684 million) in the second half, and automotive net cash — defined as cash on hand minus interest-bearing debt — stood at ¥1,170.4 billion (US$7.15 billion) at year-end. The balance sheet itself prints consolidated captions only. Its five debt lines — short-term borrowings ¥1,182,520 million, current portion of long-term borrowings ¥1,907,993 million, bonds due within one year ¥408,068 million, bonds ¥2,671,312 million, long-term borrowings ¥2,539,845 million — sum, by our addition, to ¥8,709,738 million (US$53.2 billion); the automotive/sales-financing split is carried by the management metric, not by these captions.

The register of owners has its own architecture. By the unit-share table at March 31, 2026, foreign corporations held 22,570,593 units and foreign individuals 51,180 units, of 37,127,012 units in total — 60.79 percent and 0.14 percent as printed, or 60.93 percent combined ((22,570,593 + 51,180) ÷ 37,127,012). The two largest holders on the register are, by the filing's own note, one holder: Natixis SA as trustee for Fiducie Newton 701910, at 693,124 thousand shares (18.7 percent), and Renault SA, at 633,107 thousand shares (17.1 percent). The note states the trustee position is held in substance by Renault, for a combined 1,326,231 thousand shares (693,124 + 633,107).

The trust has a date. On November 8, 2023, about 28.4 percentage points of Renault's then 43.4 percent holding went into a French trust company, with Renault retaining the economic rights to dividends and sale proceeds until the trusted shares are sold. The second amended alliance agreement was signed on March 31, 2025 and took legal effect on May 28, 2025, with an initial term of 15 years running from November 8, 2023. The filing also notes, in the same chapter, that eight of the board's twelve members are independent outside directors.

The same release states what happens to the entrusted shares in the meantime. They are to be voted neutrally, subject to limited exceptions whose content the release does not spell out. Each company may exercise the voting rights attached to its own 15 percent, capped at 15 percent of the exercisable voting rights. Renault Group may instruct the trustee to sell the entrusted Nissan shares but is under no obligation to do so within any specific pre-determined period, and a sale is to run within a coordinated and orderly process with Nissan, in which Nissan or a designated third party benefits from a right of first offer. The voting arrangement and the sale process are stated in Renault Group's release.

The other party to that trust published its own account on the same day. Renault Group's release of November 8, 2023 states that the New Alliance Agreement came into force that day, replacing the previous alliance agreement, and sets out a cross-shareholding of 15 percent between the two companies with lock-up and standstill obligations attached. It states that 28.4 percent, out of 43.4 percent, of Renault's Nissan shares was transferred into a French trust, and that Renault Group continues to benefit fully from the economic rights — dividends and proceeds of share sales — from the entrusted Nissan shares until those shares are sold.

For shareholders, the year's distribution arithmetic is short. Interim dividend, zero; final dividend, zero; fiscal 2027 forecast, also zero. Treasury-share purchases in the year were 3 thousand shares for ¥1 million (US$6 thousand), recorded in the table for acquisitions made without a shareholder or board resolution, and 3,485 thousand treasury shares were disposed of under the restricted stock unit program for ¥1,480 million (US$9.0 million). On the cash-flow statement, the dividend line for parent shareholders is a dash; dividends paid to non-controlling interests were ¥44,882 million (US$274 million).

The next year is already printed at the bottom of the summary: 3.3 million retail units, revenue of ¥13 trillion (US$79.4 billion), operating profit of ¥200 billion (US$1.22 billion), on an assumed rate of ¥150 to the dollar and ¥175 to the euro; fiscal 2025's results were reported on average rates of 151 and 175. The Re:Nissan marker for that year is automotive operating profit and automotive free cash flow positive, excluding tariff effects, by the end of fiscal 2026 — the same fiscal year in which six of the seven plant consolidations are scheduled to finish.

Conversion note: all yen amounts are converted at ¥163.8 = US$1, the rate retrieved from the source below on 24 July 2026, applied uniformly to every period shown, including forecast figures that the company itself states on a ¥150-per-dollar assumption. Dollar figures keep the significant digits of the original yen disclosure; ratios, percentages, unit counts and headcounts are not converted.