Honda has become the latest automaker to report weaker earnings as global demand softens.
The company said Friday that its profit in the July-September fell 6.7% from a year earlier to 196.5 billion yen ($1.8 billion) as vehicle and motorcycle sales slipped.
An unfavorable exchange rate also hurt earnings, the Tokyo-based automaker said.
Honda Motor Co.'s quarterly revenue declined 2.9% to 3.7 trillion yen ($34 billion) as sales declined in the U.S., Japan, the rest of Asia and Europe.
Honda, which makes the Odyssey minivan and Asimo robot, said higher tax expenses also hurt results.
Honda lowered its full-year net profit forecast for the fiscal year through March 2020 to 575 billion yen ($5.2 billion). That's down from the 645 billion yen ($5.9 billion) estimate given in August, and below the 610 billion yen earned in the previous fiscal year.
Honda said its financial services business did well, helping to offset some of the damage from other divisions.
Honda officials acknowledged to reporters that more needed to be done to reduce costs. They said a promised restructuring was underway.
Earlier this week, Honda's Japanese rival Toyota Motor Corp. reported its sales grew in key global regions, helping Japan's top automaker post an increase in quarterly net profit despite a strong yen, which hurts the earnings of Japanese exporters.
Nissan Motor Co., a Japanese automaker that has seen its brand power tarnished amid a financial misconduct scandal, reports earnings next week.