Japan’s Toyota Motor on Wednesday reported a second consecutive fall in quarterly profit, while announcing that it will set up a new company in China to make electric vehicles as it plays catch up with automakers focused on EVs. 

Here are Toyota’s results compared with estimates from analysts, compiled by LSEG.

• Revenue: 12.39 trillion yen vs. 12.1 trillion yen
• Operating profit: 1.22 trillion yen vs. 1.39 trillion yen

The world’s largest automaker by sales volume saw a nearly 28% year-on-year drop in operating profit during the quarter ended December.

The results mark Toyota’s second consecutive year over year decline in operating profit after the company saw profit fall 20% year over year in the previous quarter.

Net income attributable to the company, however, jumped to 2.19 trillion yen from 1.36 trillion yen a year ago.

The automaker’s consolidated vehicle sales for its financial third-quarter dropped to 2.44 million from 2.55 million units a year ago.

Still, Toyota maintained its full-year dividend forecast at 90 yen, compared with a dividend payout of 75 yen a year earlier.

Toyota said it will establish a wholly-owned company for the development and production of Lexus BEVs and batteries in Shanghai, China. The new company is expected to start production in 2027.

Toyota shares rose over 1% in Tokyo on Wednesday.

The company saw its operating profit drop in the key North America region by 113.7 billion yen in the December quarter, year on year, while it declined by over 46 billion yen in Asia. 

Toyota has been slower than competitors at embracing fully battery-powered electric vehicles, and instead has focused on hybrids, according to local reports.

The U.S. Postal Service said Tuesday it’s temporarily suspending all inbound packages from China and Hong Kong Posts.

The change is effective immediately and will remain “until further notice,” according to an alert posted to the agency’s website. Letters and large envelopes, referred to as “flats,” sent from China and Hong Kong won’t be impacted, the USPS said.

The announcement comes after President Donald Trump on Saturday signed executive orders imposing tariffs on China, Mexico and Canada. Trump on Monday agreed to hold off on imposing 25% tariffs on Canada and Mexico for 30 days, but the 10% tax on goods from China remains.

A provision in the orders eliminates a popular trade loophole, known as “de minimis,” which allows exporters to ship packages worth less than $800 into the U.S. duty free.

Chinese e-commerce firms, including Shein and PDD Holdings‘ Temu, have relied on the de minimis loophole as a way to bypass tariffs, and keep prices low.

Google has removed a pledge to abstain from using AI for potentially harmful applications, such as weapons and surveillance, according to the company’s updated “AI Principles.”

A prior version of the company’s AI principles said the company would not pursue “weapons or other technologies whose principal purpose or implementation is to cause or directly facilitate injury to people,” and “technologies that gather or use information for surveillance violating internationally accepted norms.”

Those objectives are no longer displayed on its AI Principles website.

“There’s a global competition taking place for AI leadership within an increasingly complex geopolitical landscape,” reads a Tuesday blog post co-written by Demis Hassabis, CEO of Google DeepMind. “We believe democracies should lead in AI development, guided by core values like freedom, equality, and respect for human rights.”

The company’s updated principles reflect Google’s growing ambitions to offer its AI technology and services to more users and clients, which has included governments. The change is also in line with increasing rhetoric out of Silicon Valley leaders about a winner-take-all AI race between the U.S. and China, with Palantir’s CTO Shyam Sankar saying Monday that “it’s going to be a whole-of-nation effort that extends well beyond the DoD in order for us as a nation to win.”

The previous version of the company’s AI principles said Google would “take into account a broad range of social and economic factors.” The new AI principles state Google will “proceed where we believe that the overall likely benefits substantially exceed the foreseeable risks and downsides.”

In its Tuesday blog post, Google said it will “stay consistent with widely accepted principles of international law and human rights — always evaluating specific work by carefully assessing whether the benefits substantially outweigh potential risks.”

The new AI principles were first reported by The Washington Post on Tuesday, ahead of Google’s fourth-quarter earnings. The company’s results missed Wall Street’s revenue expectations and drove shares down as much as 9% in after-hours trading.

Google established its AI principles in 2018 after declining to renew a government contract called Project Maven, which helped the government analyze and interpret drone videos using artificial intelligence. Prior to ending the deal, several thousand employees signed a petition against the contract and dozens resigned in opposition to Google’s involvement. The company also dropped out of the bidding for a $10 billion Pentagon cloud contract in part because the company “couldn’t be sure” it would align with the company’s AI principles, it said at the time.

Touting its AI technology to clients, Pichai’s leadership team has aggressively pursued federal government contracts, which has caused heightened strain in some areas within Google’s outspoken workforce.

“We believe that companies, governments, and organizations sharing these values should work together to create AI that protects people, promotes global growth, and supports national security,” Google’s Tuesday blog post said.

Google last year terminated more than 50 employees after a series of protests against Project Nimbus, a $1.2 billion joint contract with Amazon that provides the Israeli government and military with cloud computing and AI services. Executives repeatedly said the contract didn’t violate any of the company’s “AI principles.”

However, documents and reports showed the company’s agreement allowed for giving Israel AI tools that included image categorization, object tracking, as well as provisions for state-owned weapons manufacturers. The New York Times in December reported that four months prior to signing on to Nimbus, Google officials expressed concern that signing the deal would harm its reputation and that “Google Cloud services could be used for, or linked to, the facilitation of human rights violations.”

Meanwhile, the company had been cracking down on internal discussions around geopolitical conflicts like the war in Gaza.

Google announced updated guidelines for its Memegen internal forum in September that further restricted political discussions about geopolitical content, international relations, military conflicts, economic actions and territorial disputes, according to internal documents viewed by CNBC at the time. 

Google did not immediately respond to a request for comment.

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