Q1 operating profit 578.66 bln yen vs 997.4 bln yen yearago
Slammed by global chip shortage, COVID curbs in China
Sticks to FY profit, output forecasts citing strong demand
Raises FY materials costs estimate by 17; shares drop 3

TOKYO, Aug 4 Reuters Toyota Motor Corp39;s profit slumped a worsethanexpected 42 in its first quarter as the Japanese automaker was squeezed between supply constraints and rising costs.

Operating profit for the three months ended June 30 sank to 578.66 billion yen 4.3 billion from 997.4 billion yen in the same period a year ago, Toyota said on Thursday, capping a tough period. It has repeatedly cut monthly output goals due to the global chip shortage and COVID19 curbs on plants in China.

The scale of the earnings hit was far beyond expectations analysts polled by Refinitiv had estimated a 15 drop and appeared to catch investors by surprise. Shares of Toyota, the world39;s biggest automaker by sales, extended losses, sliding 3.

It39;s extremely bad, said Koichi Sugimoto, an analyst at the Mitsubishi UFJ Morgan Stanley Securities.

While production snarls had already been flagged by the automaker, Sugimoto said some of the higher costs stood out.

The automaker said rising material prices cost it 315 billion yen.

Despite the grim quarter, the automaker stuck to its forecast for fullyear operating profit and a plan to produce 9.7 million vehicles this fiscal year, citing what it said was strong residual demand.

A Toyota spokesperson…