Honda Motor Co., Ltd.

Q3 FY ending Mar-26 (9M) headline performance vs last year - Operating profit: JPY 591.5bn for the third quarter ended Dec-25, down JPY 548.4bn YoY (as discussed in management’s bridge). - Net profit attributable to parent (quarter): JPY 465.4bn, down JPY 339.8bn YoY. - Strong motorcycle backdrop: management highlighted record high group unit sales, operating profit, and operating margin for results up to Q3. - Bad but important drivers of profit decline: tariff hit + one-time EV-related costs more than offset other positives.

Key profit drivers (what moved earnings) - Positives - Sales impact: +JPY 38.1bn (motorcycle volume strength; also financial services profit). - Price/cost impact: +JPY 225.9bn (effective price revisions). - Negatives - One-time EV-related expenses: -JPY 267.1bn - Tariff impact: -JPY 289.8bn - Foreign currency impact: -JPY 111bn - R&D impact: -JPY 35.7bn - Automobiles were the drag: Automobile operating profit = JPY -166.4bn (loss); the company said this reflects EV nonrecurring costs and tariff pressure, plus semiconductor-related unit/production constraints earlier in the year.

Cash flow / balance-sheet strength (investor-friendly) - Operating cash flow after R&D adjustment: JPY 1.8558tn for the first 9 months, on par with the same period last year. - Free cash flow (ex financial services): JPY 917.4bn. - Net cash at end of Q3: JPY 3.1707tn. - Surprising/positive nuance: despite large earnings headwinds in autos, Honda emphasizes cash generation remains resilient.