Nippon Steel reports lower net profit despite rising sales in fiscal 2025-2026, warns of rising geopolitical risks

Japanese Nippon Steel Corporation announced its financial and operating results for the 2025-26 fiscal year ended March 31.

The company recorded a net profit of 44.75 billion yen ($283.52 million) in this fiscal year, compared with a net profit of 382.97 billion yen in the previous fiscal year, and its net sales were JPY. 10.06 trillion yen ($63.74 billion), up 15.7 percent from net sales of 8.70 trillion yen in the previous fiscal year. In addition, Nippon Steel's operating profit fell 55.7 percent year-on-year to 242.90 billion yen ($1.54 billion).

Meanwhile, in the 2025-26 fiscal year, the company produced 50.48 million tons of crude steel, up 27.5 percent, and delivered steel products at 31.16 million tons, down 1.5 percent year-on-year.

Nippon Steel forecasts that it will produce about 57.50 million tons of crude steel in fiscal year 2026-27, and expects its steel product shipments to be about 31.50 million tons in this fiscal year.

Global demand in the manufacturing and construction sectors remains weak both in Japan and abroad, with the exception of certain industries such as artificial intelligence, power generation and defense, according to the statement. Against this backdrop, the global steel industry business environment continues to come under significant pressure. The economic downturn in China has exacerbated the supply-demand imbalance in the steel sector, leading to excess production capacity. As a result, exports of cheap Chinese steel products increased, negatively impacting global steel markets. Nippon Steel also warned that trade protection measures introduced in various countries could increase the risk of low-cost steel imports entering the Japanese market. He stressed the growing importance of strengthening the study and implementation of trade protection measures in Japan.

Commenting on geopolitical developments, the company said the impact of the situation in the Middle East now extends beyond the energy supply disruptions traditionally associated with past oil crises. With globally integrated supply chains, the impacts extend across international markets and industries. The Middle East has become an increasingly important export destination for Asian economies, including Japan, as the region's economic size has expanded significantly. As a result, the ongoing conflict is expected to impact demand in many industries around the world. In addition, the influence