Canon Can't Even Make a Billion Dollars Anymore

[unfocused]

Read a little further: "As for compact digital cameras, while highly functional PowerShot-series models contributed to healthy sales, unit sales for the third quarter declined from the corresponding period of the previous year due to sluggish market demand."

Also: "Demand for compact digital cameras is anticipated to increase for models offering high functionality and high added value."

Canon is acknowledging sluggish demand for compact digital cameras and targeting higher end models (In particular the G1X and EOS-M). So, yes, they recognize that the traditional low-price consumer PowerShot models are not doing well and they are targeting the higher end.

This is a problem for all camera manufacturers, not just Canon. For years, profits from low-end consumer models have provided a foundation for manufacturers to build off of. DSLR sales remain strong and profitable, but will there ever be sufficient demand to replace the revenues lost from compact digital sales? I doubt it. It would not surprise me to see Canon's imaging business unit (cameras) and similar units within Nikon, Sony, Fuji and others all shrink considerably in the coming years. Bad news for employees who work on the production lines for compact digital cameras. But, since the ultimate success of a company is based more on return on investment rather than gross sales, a smaller, leaner imaging business unit doesn't necessarily spell doom.

Companies get in trouble when they fail to adapt to changing market conditions (Kodak). Those that anticipate and adjust succeed (Fuji).

Part of Canon's (and Nikon's) strategy seems to be to diversify the DSLR product line: maintaining a full range of APS-C models while expanding their Full Frame offerings. But, the DSLR market is fairly mature, so they also need to capture new customers with the high-end compacts. Manufacturers must navigate generational and cultural differences and the high-end compact offerings are part of that strategy.

There is absolutely NOTHING in the report that supports many of the posts on this thread. It might be fun and personally satisfying to misread this report to confirm pre-conceived ideas of what Canon's pricing strategy should be for a product that a forum participant happens to think costs too much, but the financials simply don't support any of that wishful thinking.

 

[PackLight]

Companies get in trouble when they fail to adapt to changing market conditions (Kodak). Those that anticipate and adjust succeed (Fuji).

Seriously, Canon is a cash flush company that just made a bit short of Billion dollars in one quarter. Now they are in trouble?

 

[jrista]

Companies get in trouble when they fail to adapt to changing market conditions (Kodak). Those that anticipate and adjust succeed (Fuji).

Seriously, Canon is a cash flush company that just made a bit short of Billion dollars in one quarter. Now they are in trouble?

That's my question. It seems Canon is doing remarkably well considering the world economic situation and some extremely intense competition.

 

[PackLight]

Companies get in trouble when they fail to adapt to changing market conditions (Kodak). Those that anticipate and adjust succeed (Fuji).

Seriously, Canon is a cash flush company that just made a bit short of Billion dollars in one quarter. Now they are in trouble?

That's my question. It seems Canon is doing remarkably well considering the world economic situation and some extremely intense competition.

They must be close to bankruptcy if they are only making 3 billion plus a year.

Here is the reality;
Canon is listed as paying out 63% of their profits in dividends. The company "Canon" doesn't suffer at all in this down turn. The dividends just get smaller. The majority of the money everyone is discussing is money that doesn't go to R&D or anything else, it goes to the shareholders.

 

[well_dunno]

Panasonic Posts Loss of Nearly $9 Billion


http://online.wsj.com/article/SB10001424052970204712904578089962887027962.html?mod=WSJEurope_hpp_LEFTTopStories

 

[Greg_M]

If I were on Mars and Canon was selling oxygen they might have me, but the reality is that people like me (that are on fixed incomes and/or not professionals) will simply not buy their product and their income will go down instead of up.

This is such a simple concept....

 

[Gothmoth]

canon sales are still strong.. no suprise given the large EXISTING userbase.

but... new DSLR users buy more nikon gear than any time before.

i can only speak from my experience .. sure.

but nikon sells very strong this year for people who are buying new into a DSLR system.

no wonder if you ask me.... though economy... and nikon offers a camera with great public reception for 500-600 euro less (D800 vs. 5D MK3).

the D600 also sells very well.

 

[unfocused]

Companies get in trouble when they fail to adapt to changing market conditions (Kodak). Those that anticipate and adjust succeed (Fuji).

Seriously, Canon is a cash flush company that just made a bit short of Billion dollars in one quarter. Now they are in trouble?

What is it about the Internet that makes people incapable of reading an entire post and instead simply pull a small quote out of context so they can write silly drive-by comments.

 

[jrista]

canon sales are still strong.. no suprise given the large EXISTING userbase.

but... new DSLR users buy more nikon gear than any time before.

i can only speak from my experience .. sure.

but nikon sells very strong this year for people who are buying new into a DSLR system.

no wonder if you ask me.... though economy... and nikon offers a camera with great public reception for 500-600 euro less (D800 vs. 5D MK3).

the D600 also sells very well.

You have any external resources that actually back up that claim? Or is it just another anecdote intended to skew peoples thinking?

I didn't even know that companies reported that kind of information, or better yet, were even capable of GATHERING it in the first place! How the hell does anyone who might be capable of generating that kind of specific information know if someone buying a Nikon camera is a "new" photographer or not? What about all the people who just buy a camera, and don't tell their reseller ANYTHING about themselves other than that they want a particular camera? Sorry, but I call bullshit. No one could even get enough information about enough buyers to derive specific enough statistics that could actually be used to determine that Nikon, Canon, or any other manufacturer is selling more cameras to "new photographers."

I believe Nikon has gained "switchers", who have dumped Canon in favor of a brand that offers them more dynamic range. I believe that because there are literally people who HAVE switched who've talked about it, blogged about it, and created videos about it. Wherever there is a vocal sample, there is a larger base from which that vocal sample comes from. There is information to back up the claim that Canon has lost some customers to Nikon due to existing Canon customers switching brands (or adding Nikon to their kit rather than getting a new Canon camera.) There is no information about how many such individuals there might be in total, though, and on the flip side there have definitely been people who've jumped off the Nikon ship to get a 5D III or a 1D X as well...so the net change could even be neutral.

 

[Simba]

canon sales are still strong.. no suprise given the large EXISTING userbase.

but... new DSLR users buy more nikon gear than any time before.

i can only speak from my experience .. sure.

but nikon sells very strong this year for people who are buying new into a DSLR system.

no wonder if you ask me.... though economy... and nikon offers a camera with great public reception for 500-600 euro less (D800 vs. 5D MK3).

the D600 also sells very well.

You have any external resources that actually back up that claim? Or is it just another anecdote intended to skew peoples thinking?

I didn't even know that companies reported that kind of information, or better yet, were even capable of GATHERING it in the first place! How the hell does anyone who might be capable of generating that kind of specific information know if someone buying a Nikon camera is a "new" photographer or not? What about all the people who just buy a camera, and don't tell their reseller ANYTHING about themselves other than that they want a particular camera? Sorry, but I call bullshit. No one could even get enough information about enough buyers to derive specific enough statistics that could actually be used to determine that Nikon, Canon, or any other manufacturer is selling more cameras to "new photographers."

I believe Nikon has gained "switchers", who have dumped Canon in favor of a brand that offers them more dynamic range. I believe that because there are literally people who HAVE switched who've talked about it, blogged about it, and created videos about it. Wherever there is a vocal sample, there is a larger base from which that vocal sample comes from. There is information to back up the claim that Canon has lost some customers to Nikon due to existing Canon customers switching brands (or adding Nikon to their kit rather than getting a new Canon camera.) There is no information about how many such individuals there might be in total, though, and on the flip side there have definitely been people who've jumped off the Nikon ship to get a 5D III or a 1D X as well...so the net change could even be neutral.

Nikon Rumon just released the Nikon financial results, which are quite good in the DSLR market.
http://nikonrumors.com/2012/11/01/nikons-financial-results-for-the-first-half-of-the-year-are-out.aspx/

 

[AG]

Going on Nikons figures they are not really in a great place either.

381Billion Yen = $4.75 Billion USD Net sales (Up $705 Million USD from last year)
41.8 Billion Yen = $521,629,530.72 USD Operating income (Down $69.8 Million USD from last year)

So does this mean that if Nikon only made $521.6 Million(USD) they too couldn't make a Billion Dollars either?

 

[hsmoscout]

This sucks. I was gonna get the 7D soon, but it looks like I'll have to wait :/
Is Canon trying to get more people to buy direct from Canon?? It seems like it with their whole "Holiday hushup" thing

 

[Simba]

Going on Nikons figures they are not really in a great place either.

381Billion Yen = $4.75 Billion USD Net sales (Up $705 Million USD from last year)
41.8 Billion Yen = $521,629,530.72 USD Operating income (Down $69.8 Million USD from last year)

So does this mean that if Nikon only made $521.6 Million(USD) they too couldn't make a Billion Dollars either?

Canon is a much bigger and diversified company, which not only sells cameras, but printers, scanners, camcorders, copy & fax machines, etc. If you just consider DSLR cameras that most of us in this forum are interested, the sales of Canon is dropping, while Nikon is rising. Nikon is quite profitable considering its small product lines.

 

[emag]

Doesn't affect this amateur a whit; as for pros, I'll defer opinions on that to you pros. If I can afford it and the Director of Acquisitions (my wife) is okay with it, I'll buy it. I'll shop around and then find a way to pay over time for no interest if it's a big slug of bucks. Dealers will find a way to add value to the deal to make for an attractive package at Canon's MAP. I don't mind using 'last year's technology' if it works for me. In a year the 5dIII won't suddenly stop taking nice photos, anymore than my 40D did after getting a 60D. Improved lenses are a different animal, the best is really worth ponying up for. I can see that MAP may help smaller and more local retailers who find it difficult to compete with the big boys.