Nissan cuts annual profit forecast for third time, pledges turnaround action

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YOKOHAMA, Japan (Reuters) -Nissan on Thursday reported a sharp drop in third-quarter profit and cut its full-year outlook for the third time, in a sign of deepening turmoil at the Japanese automaker after it pulled out of merger talks with rival Honda.

Nissan, whose shares have been battered by poor performance in key markets China and the United States, said it would speed up turnaround efforts announced three months ago.

It said it plans to cut costs by about 400 billion yen ($2.60 billion) in fiscal 2026 as it moves to create a leaner and more resilient business, including by reducing labour costs and restructuring its manufacturing base.

About a fourth of the cost savings would come from measures related to vehicle manufacturing, such as consolidating its production lines, the closure of a factory in Thailand in the first quarter of next fiscal year and two other plants at later dates, it said, without specifying which plants.

Nissan also said it would restructure its top management by eliminating its corporate officer system and reducing top management positions by 20% starting from the next fiscal year, which begins in April.

The company lowered its operating profit forecast by 20% to 120 billion yen for the current financial year after reporting a 78% fall in third-quarter operating profit.

Operating profit totalled 31.1 billion yen for the October-December period, compared with an average estimate of 63.2 billion yen in a poll of eight analysts by LSEG and a 141.6 billion yen profit in the same period a year earlier.

($1 = 153.9500 yen)

(Reporting by Daniel Leussink; Editing by Jane Merriman)