The Aichi Prefecture-based automaker said its sales in the reporting period totaled 709,870 units, with the drop, in part, attributed to an ongoing semiconductor crunch.
The semiconductor shortage has plagued automakers worldwide, with Toyota, Japan's and the world's largest automaker, being no exception.
The maker of the Prius hybrid and Corolla sedan models said its sales overseas declined 9.7 percent in the recording period to 579,652 units.
Sales in its major North American and Chinese markets both logged notable declines in January, Toyota said.
The automaker's sales in Japan, meanwhile, increased 18.0 percent to 130,218 units, Toyota said, bouncing back from a year earlier as sales normalized commensurate with the eased impact of the COVID-19 pandemic.
Toyota, also known for its popular Highlander SUV, saw output rise in the recording period, with global production rising 8.8 percent to 689,090 units.
This was aided by domestic production topping 30 percent, with 211,572 units rolling off the lines, according to Toyota.
Solid growth in North America and Europe saw overseas output edge up 1.4 percent to 477,518 units, with Toyota saying it forecasts 750,000 units to be produced in February, followed by 900,000 vehicles manufactured in March.
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