Komatsu considers price hikes in the US in response to tariffs
Company expects operating profit to drop 27% in fiscal 2025
Komatsu Ltd. Chief Executive Officer Takuya Imayoshi may raise prices in the US in response to tariffs, with the company projecting a 27% drop in operating profit this fiscal year because of the levies and the stronger yen.
The construction and mining equipment business is expected to suffer an annual negative impact of 140 billion yen ($976 million) from increased costs linked to US tariffs, it said in a filing. The impact for the fiscal ending in March 2026 will be a negative 78 billion yen when factoring in its inventory.
The North American market accounted for 25% of overall revenue last fiscal year. The company has five months’ worth of inventory at the moment, Imayoshi said at a briefing on Monday. Komatsu makes about half of its products for the US in Japan and China. The impact of retaliatory tariffs by China is factored into the forecast.
“Resilient demand for mining equipment can support earnings, while price hikes and US support for coal could add to factors that offset tariff impact,” Bloomberg Intelligence said.
The world’s second-largest supplier of construction and mining equipment behind Caterpillar Inc. said fourth-quarter operating profit rose 24%, beating analyst estimates. The company announced a share buyback of as much as 100 billion yen.
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