Honda Motor Co. reported a more than doubling of net profit for the fiscal first quarter and raised its full-year earnings outlook, as the weak yen boosted quarterly results and improved the profit outlook.

The Japanese automaker said on Wednesday that operating profit in its automobile business for the three months ended June rose, partly due to the yen's weakness. A weaker yen increases the value of profits earned in foreign currencies when converted back into yen.

Chief Financial Officer Masao Kawaguchi said vehicle sales fell in China but rose in the U.S., where higher gasoline prices have led consumers to favor fuel-efficient models, including hybrid vehicles.

Kawaguchi noted that China's economic conditions are poor and that the phase-out of gasoline-powered cars may be accelerating due to rising oil prices.

Honda maintained its global vehicle sales forecast for the fiscal year ending March 2027 unchanged. Kawaguchi said the company plans to update its sales forecast after the second quarter, as the impact of Middle East conflict on the global economy remains unclear.

As part of efforts to strengthen its automotive business in China, Honda extended its joint venture agreement with Guangzhou Automobile Group to 2038 in July. The company's sales in China have declined in recent years due to intense competition and the world's largest auto market's gradual shift away from gasoline-powered vehicles.

Motorcycle business operating profit also increased in the first quarter, supported by higher sales in India and Brazil.

The company expects full-year revenue and net profit to rise, citing the recent depreciation of the yen.

This will reverse the net loss Honda recorded in the previous fiscal year—its first loss since listing in 1957—after the company booked approximately $10 billion in electric vehicle-related losses from abandoning a major U.S. EV plan.

Honda is working to improve its hybrid electric vehicle lineup to boost automotive business profitability and plans to stop production of the Prologue sport utility vehicle, its only EV sold in the U.S., by the end of this year.

After announcing the annual loss in May, CEO Toshihiro Mibe said he would abandon a 2021 target to make all Honda vehicles electric or fuel-cell vehicles by 2040.

This move aligns with most U.S. automakers, including Volkswagen, Stellantis, and Ford, which are scaling back previously aggressive EV production expansion plans.

The Japanese automaker's first-quarter net profit reached 450.9 billion yen ($2.86 billion), far exceeding the 208.2 billion yen average estimate from analysts surveyed by data provider Quick. Revenue rose 13.5% to 6.062 trillion yen.

For the current fiscal year, Honda maintained its motorcycle sales forecast of 22.8 million units and its vehicle sales forecast of 3.39 million units. The company expects revenue to rise 11% to 24.150 trillion yen and net profit to reach 400 billion yen, up from previous forecasts of 23.150 trillion yen and 260 billion yen, respectively.

Due to the weak yen, the company raised its full-year EV-related loss estimate from 500 billion yen to 520 billion yen. Kawaguchi said most of that is payments to North American suppliers.