Makita Corporation slashed its full-year operating profit forecast by 11% as the Japanese power tool manufacturer restructures global production networks to counter rising U.S. trade barriers with China.
The Anjo-based company now expects operating profit of ¥95 billion ($620 million) for the fiscal year ending March 2026, down from an earlier projection of ¥107 billion. Revenue is forecast to decline 3.1% to ¥730 billion ($4.8 billion).
The firm reported first-half revenue of ¥378.4 billion ($2.5 billion), down 2.1% from a year earlier, though operating profit held nearly flat at ¥51.5 billion ($336 million). Overseas sales, which account for 83% of revenue, fell 3.2% as yen appreciation eroded export earnings.
Makita is reducing its reliance on Chinese factories, which currently supply roughly 60% of its American market, to just 20% by the second half of this fiscal year. The company plans to ramp up production at facilities in Thailand and Romania to serve U.S. customers instead.
The manufacturer faces elevated tariffs on Chinese goods entering the United States, where trade barriers have reached levels exceeding 50% on some categories. North American sales declined 8.4% in local currency terms during the first half, though the company saw strength in domestic Japanese sales, which rose 3.7%.
Makita continues to expand its 40Vmax cordless tool lineup, which the company positions as a premium alternative to gas-powered equipment. Cordless products now represent 58% of overall sales, with the 40Vmax series growing approximately fivefold over the past five years. The company cited demand from professional contractors in construction, mining, and infrastructure sectors.
Management maintained its shareholder return target of at least 35% of net profit and paid an interim dividend of ¥20 per share.
