Hyundai Mobis: South Korea’s largest automotive parts manufacturer, reported a sharp decline in fourth-quarter net profit, reflecting losses tied to equity investments in affiliated companies and the impact of U.S. tariffs on auto-related sectors. The company disclosed the results in a regulatory filing released Wednesday, offering a mixed picture of short-term pressure alongside longer-term operational resilience.

Fourth-Quarter Earnings Miss Market Expectations

For the three months ending in December, Hyundai Mobis recorded net profit of 768.1 billion won, equivalent to approximately $536 million. This marked a 39.9 percent drop from the same quarter a year earlier, when earnings exceeded 1.28 trillion won. The results fell well below market forecasts, as analysts had expected net profit to average around 1.05 trillion won, according to data compiled by Yonhap Infomax.

Operating Performance Shows Relative Stability

Despite the steep fall in net income, operating profit declined at a more modest pace. Operating earnings for the quarter totaled 930.5 billion won, down 5.6 percent year-on-year. Revenue performance was comparatively stronger, with sales increasing 4.7 percent to 15.39 trillion won. The divergence between sales growth and profit decline highlighted the role of non-operational factors in shaping the company’s bottom line.

Investment Losses and Tariffs Weigh on Results

Company officials attributed the weaker net profit primarily to valuation losses linked to Hyundai Mobis’ shareholdings in affiliates under Hyundai Motor Group. In addition, sector-specific tariffs imposed by Washington on auto-related products added further pressure, particularly affecting overseas operations and cost structures. These factors combined to offset gains generated by the firm’s core manufacturing activities during the quarter.

Full-Year Results Reflect Mixed Trends

Looking at the full year, Hyundai Mobis posted net profit of 3.66 trillion won for 2025, representing a 9.7 percent decline from the previous year. In contrast, annual operating profit rose 9.2 percent to 3.35 trillion won, underscoring stronger performance at the operational level. Total sales for the year climbed 6.8 percent to 61.11 trillion won, supported by expanding production capacity and steady demand from global automakers.

Manufacturing Operations Drive Annual Growth

The company said improvements in operating profit were largely driven by its manufacturing businesses, including module assembly and auto parts production. Sales from this segment increased 5.9 percent year-on-year to 47.8 trillion won. Growth was supported by the full-scale operation of electrification plants in North America, as well as rising demand for high value-added components such as automotive electronics and advanced mobility systems.

Focus on Electrification and Core Components

Hyundai Mobis highlighted the growing contribution of electrification-related facilities and next-generation components to its revenue base. The company has been expanding production of key parts tied to electric vehicles and advanced driver assistance systems, positioning itself to benefit from global shifts toward cleaner and smarter mobility solutions. Management noted that these areas are expected to play a central role in sustaining long-term growth.

Investment Plans Target Future Mobility

Looking ahead, Hyundai Mobis plans to continue investing heavily in facilities and technology to strengthen its competitiveness in future mobility markets. The company said its research and development spending is expected to exceed 2 trillion won this year for the first time, signaling a sustained commitment to innovation. These investments are aimed at reinforcing capabilities in electrification, automotive electronics, and other strategic growth areas amid an increasingly competitive global auto industry.