Canon Business General

Canon boosts forecasts, printer and camera demand strong

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Canon Inc. (the “Company”), at a Board of Directors’ meeting, held on July 19, 2021, revised the consolidated results forecast for the fiscal year ending December 31, 2021, that it released on April 26, 2021, as follows.

Reason for Revision

In the second quarter of 2021, as was the case in the first quarter, sales of inkjet printers, which continue to be in high demand due to more people working and learning from home globally, grew strongly. Additionally, even amid restrictions on activities linked to the COVID-19 pandemic, interest in and demand for cameras increased, resulting in sales remaining strong in each region, particularly for full-frame mirrorless cameras and interchangeable lenses. The Company is also posting sales growth of other products, such as medical and semiconductor lithography equipment, thanks to favorable market conditions. Amid inflation caused by a shortage of goods, we expect the favorable market environment to continue in the second half of the year. Additionally, more people getting vaccinated is expected to bring the number of people commuting to offices back, resulting in print demand recovering in the office market. Based on these assumptions, the Company has revised its full-year consolidated results forecast.

This notice contains forward-looking statements with respect to future results, performance, and achievements that are subject to risk and uncertainties and reflect management’s views and assumptions formed by available information. All statements other than statements of historical fact are statements that could be considered forward-looking statements. When used in this document, words such as “anticipate,” “believe,” “estimate,” “expect,” “intend,” “may,” “plan,” “project” or “should” and similar expressions, as they relate to Canon, are intended to identify forward-looking statements. Many factors could cause the actual results, performance, or achievements of Canon to be materially different from any future results, performance, or achievements that may be expressed or implied by such forward-looking statements, including, among others, changes in general economic and business conditions, changes in currency exchange rates and interest rates, the introduction of competing products by other companies, lack of acceptance of new products or services by Canon’s targeted customers, inability to meet efficiency and cost reduction objectives, changes in business strategy and various other factors, both referenced and not referenced in this notice. A detailed description of these and other risk factors is included in Canon’s annual report on Form 20-F, which is on file with the United States Securities and Exchange Commission. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those described herein. Canon does not intend or assume any obligation to update these forward-looking statements.

Revision of Consolidated Results Forecast for Fiscal Year Ending December 31, 2021

Millions of yen (except per share amounts)
Net sales Operating profit Before Tax Net Income Per Share
Previous forecast 3,500,000 198,000 211,000 140,000 133.89
Revised forecast 3,600,000 283,000 298,000 201,000 192.23
Change 100,000 85,000 87,000 61,000 58.34
Percent change 2.9% 42.9% 41.2% 43.6% 43.6%
For reference, Fiscal 2020 3,160,243 110,547 130,280 83,318 79.37

neuroanatomist

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As a previous Olympus owner, I know what can happen when finances aren't good,
I’m not a Fuji shooter (my kids’ Instax cameras notwithstanding), but if I were, I’d be concerned since they are reportedly maintaining their Imaging Division primarily as a ‘contribution to society’.
 
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reef58

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I’m not a Fuji shooter (my kids’ Instax cameras notwithstanding), but if I were, I’d be concerned since they are reportedly maintaining their Imaging Division primarily as a ‘contribution to society’.
It seems the XT4 and medium format stuff is popular from what I read and see on YouTube. Makes you wonder about the validity of the social media narrative. That being said I have considered the medium format stuff myself.
 
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John Wilde

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(sarcasm) I thought Canon was supposed to be the next Kodak. :)

(Seriously, some people posted that stupidity in the past.)
 
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dirtyvu

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Contrary to what people think, it's not a social media narrative. You only have to look at financial statements, fuji's camera division is in trouble as well as thir imaging division. Fuji's only positive growth is in their Healthcare division.
It seems the XT4 and medium format stuff is popular from what I read and see on YouTube. Makes you wonder about the validity of the social media narrative. That being said I have considered the medium format stuff myself.
 

usern4cr

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I’m not a Fuji shooter (my kids’ Instax cameras notwithstanding), but if I were, I’d be concerned since they are reportedly maintaining their Imaging Division primarily as a ‘contribution to society’.
Really? That's the first I heard of that. I hope they stay in business, as I think they have possibly the best people designing the camera user interface - people who are real photographers more than technicians. But that's just my opinion. I hope their larger format line survives - that's got to be a major resource drain to come out with a new line of big & expensive lenses if they don't get enough sales.

As far as Olympus, it's really a shame that they went out of business. I think that they had the best designers of lenses as far as user interface, and their quality was superb. But they bet everything on a small sensor and also (from what I've heard) had some serious mismanagement of their finances.
 

neuroanatomist

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Really? That's the first I heard of that. I hope they stay in business, as I think they have possibly the best people designing the camera user interface - people who are real photographers more than technicians. But that's just my opinion. I hope their larger format line survives - that's got to be a major resource drain to come out with a new line of big & expensive lenses if they don't get enough sales.

As far as Olympus, it's really a shame that they went out of business. I think that they had the best designers of lenses as far as user interface, and their quality was superb. But they bet everything on a small sensor and also (from what I've heard) had some serious mismanagement of their finances.
 
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usern4cr

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Well, from the article it states that the Fuji imaging division is still making money, and that they seem to be happy continuing it as long as it does. So that sounds like a good thing, rather than something that should worry people about Fuji's camera future. Fortunately, they had the sense to not enter the FF market as there is massive competition there. They have probably the best APS-C system and continue developing it, as well as slowly developing their MF lens system for those with a lot more money. I hope they thrive.
 

unfocused

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Well, from the article it states that the Fuji imaging division is still making money, and that they seem to be happy continuing it as long as it does. So that sounds like a good thing, rather than something that should worry people about Fuji's camera future. Fortunately, they had the sense to not enter the FF market as there is massive competition there. They have probably the best APS-C system and continue developing it, as well as slowly developing their MF lens system for those with a lot more money. I hope they thrive.
Yes, it always helps to read the whole article:

This only goes to highlight that Fuji is no longer primarily a camera company, even if the cameras themselves are modestly successful and make a profit. All of this suggests that if they pay their way, they will be welcomed as part of the Fuji family. That the X Series and G mount cameras are being actively developed is encouraging. In fact, of all the subdivisions in Imaging Solutions last year, Electronic Imaging suffered the smallest decline in revenue at 5%. However, perhaps the strangest — and most important — part of Fuji's success strategy for Imaging is... film! As I've commented on before, Fuji sold 10 million Instax cameras in 2019, more than the whole digital camera industry sold in 2020! More importantly, Instax camera and film sales made up 9% of that 13% of Fuji revenue, with just 3% from its Electronic Imaging subdivision. Is digital really paying its way? Who knows, but as long as Fuji is structured in this manner — and they make money — it appears to be business as usual.

I knew that Instax cameras were the best selling cameras in the world shortly after they were introduced, but this sounds like they continue to dominate the market.

This article makes me think that Fuji has found a niche in the photography market and as long as they are profitable (which they are) they aren't going to abandon the market. Not every company aspires to be Canon.
 
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neuroanatomist

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Yes, it always helps to read the whole article:
I knew that Instax cameras were the best selling cameras in the world shortly after they were introduced, but this sounds like they continue to dominate the market.

This article makes me think that Fuji has found a niche in the photography market and as long as they are profitable (which they are) they aren't going to abandon the market. Not every company aspires to be Canon.
Perhaps Japanese corporations are different, but when a US corporation reorganizes and a small division is left on its own in the new org, that’s when the savvy people in that division seek other employment because the writing is on the wall, so to speak.
 
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dirtyvu

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Well, from the article it states that the Fuji imaging division is still making money, and that they seem to be happy continuing it as long as it does. So that sounds like a good thing, rather than something that should worry people about Fuji's camera future. Fortunately, they had the sense to not enter the FF market as there is massive competition there. They have probably the best APS-C system and continue developing it, as well as slowly developing their MF lens system for those with a lot more money. I hope they thrive.

go to the financials. not some distilled article (least of all, fstoppers). the new financial report will be released on July 29. let's hope it's better but the last wasn't pretty. the imaging division doesn't really contribute to Fuji's financial line. If you take away the film portion of the imaging division, the digital camera business would be under water. Film can't save the digital part of the business forever.
 
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David_D

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Wow! A 3% change in revenue has a 43% increase in operating profit!! Those incremental sales numbers are in high margin products
I am guessing they also revised some operating costs down, but that is not reported separately. But that is still a huge swing!
 

jam05

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Contrary to what people think, it's not a social media narrative. You only have to look at financial statements, fuji's camera division is in trouble as well as thir imaging division. Fuji's only positive growth is in their Healthcare division.
Fuji's camera division which includes it Cine lenses are a long way from being in dire straights. Sony's imaging division has lost money for the past 3 years. I know being a share holder. Sony gets by on its gaming division and music. The movie production, cameras, and that loser of a cell phone are a few division that will never get back to 2016 levels
 

usern4cr

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go to the financials. not some distilled article (least of all, fstoppers). the new financial report will be released on July 29. let's hope it's better but the last wasn't pretty. the imaging division doesn't really contribute to Fuji's financial line. If you take away the film portion of the imaging division, the digital camera business would be under water. Film can't save the digital part of the business forever.
I don't follow the financial reports for any photo company. But I did read the whole article mentioned, and it mentioned that the film part contributed more money than the digital part, but it said the digital part WAS contributing positive earnings which were appreciable. That is certainly not "underwater", at least according to the article mentioned.
 
I thought the same way :) And I wondered what if the sales went 3% down. They would have been in trouble. But I think there is something more complex behind those numbers
Corp finance is my day job, so I just read through their Q1 release to see if I could add any insights... there definitely is more to the story, I'm sure! While the new R bodies and RF lenses definitely helped the top line revenue, it seems like the biggest reason for the jump in operating profit is factory utilization increases which were much lower last year during the pandemic high point. Idle production capacity = more fixed costs for less product produced sold, so as they made more high margin lenses and bodies it more than offset the costs. Selling a lot more online apparently helped them too, as digital sales tend to be more profitable than traditional wholesale/retail channels.
 
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