Canon Says Q1 Profit Hit by Weak Printer, Camera Sales

[The Chris]

4 hours ago, eleison said:

 

But yet, share holders are willing to give Tesla a high market cap.  Say what you want, investors as a whole believe in the company.  In one of Tesla's latest press release, telsa blames themselves and their "hubris" for not meeting their production numbers.  When has Canon done something similar and followed through?  Canon is spinning in it's press releases.  That's not a good sign.  After a while, it might actually believe it's own spin. It might already have.

 

 

Remember the dot com bubble? Plenty of speculative investment that now isn't worth the paper it's printed on. Canons profits are real, the only people making money off Tesla are traders that bought last year when fires caused shares to nosedive to $140 and are now selling them to suckers at $250. There's nothing in their business plan that says profits are coming in the next couple years, at some point a lot of people are gonna get hosed

Bash Canon all you want, but again for the first three months of this year they've made a better profit than Tesla has in its entire existence, and this will be the case for years to come. Cars aren't the endgame for Tesla, it's what goes into them - that's why they've invested far more in the Gigafactory than the auto plant. 

Theres no shame in admitting you're wrong. Apologies if I've been harsh, but you have no clue what you're talking about. 

[MattH]

Why are we even analysing the profits of camera companies? We aren't camera maufaturers checking in on the competition.   I mean, I use cameras, but I also use pensils, and i've never one cared to find out what profits the pencil making company makes. I guess if things are so bad the company is going to shut up shop like samsung then it is relevant.  But that wont happen with canon.  The compacts dying thing is old old news, how long have camera phones been out, jesus.   My first camera was a nokia 7250.

[Ivanhurba]

If compacts and P&S are such a big chuck of their sales that they partially blame their profit fall to them they should have innovated there.

For non-pros and amateurs the marketing teams have hammered the need of 4k. And if the buyers are a very small group of pros looking for a second or third body then that same 4k, or log, or better low light, or better slow motion, would have fit the bill; they had plenty of options but they decided not to offer any of that to either soccer moms or pros and stagnate.

I agree we'll have to wait and see how the rest of the year develops but the trend is quite clear in my opinion.

[Jimmy]

Who is pushing 4K at consumer level though? Sony, Samsung and Panasonic... what do they have in common that Canon don't? TV sales.

Maybe Canon have been wise not to waste R&D money on 4K until they see if it hits a certain consumer saturation level? Those other companies were also pushing 3D at a consumer level and probably lost big money in R&D and bringing products to market when it didn't really take off.

It is always wise to step away from personal wants and needs when judging this sort of financial/business stuff.... As I said earlier, I am very interested in 360 and VR, but certainly wont judge any company that are cautious about this market as it is still very niche... 4K is still quite niche to alot of people, even to pro video shooters, big time vloggers etc

Canon, Nikon etc have let the dust settle and will probably feel 4K has taken off well enough to start really moving with it. That may have been a wise move for all we know.

[Ivanhurba]

10 minutes ago, Jimmy said:

Who is pushing 4K at consumer level? Sony, Samsung and Panasonic... what do they have in common that Canon don't? TV sales.

Maybe Canon have been wise not to waste R&D money on 4K until they see if it hits a certain consumer saturation level? Those other companies were also pushing 3D at a consumer level and probably lost big money in R&D and bringing products to market when it didn't really take off.

Yes, I knew about their investments in 4k tv and I agree Canon is usually wise taking the slow path. 3d was burden by expensive TVs, cumbersome glasses that nobody wanted to wear, deals locking releases like avatar to buying a Panasonic product, bad 3d conversions, not a lot of 3d production -mostly because of costs- and a global recession.

But Canon is letting slip between their fingers it's staple business. All the innovative products you quoted they're producing now are too segmented, too limited or too high end. The big seller of this year before the olympics is going to be the 80D but it just offers a very good focusing system that sometimes fails too and which probably will be replicated by the end of the year in the GH5 or the next Sony. No 5-axis, no EVF, no focus help for manual, no log, soft image. Canon has been outpaced (BSI sensors), outinnovated (not even a word, I know) like with the a7sII ISO 409,600 or outsmarted (42.2mp Sony sensor has more advantages like no aliasing and even better low light than their 50mp 5DS line) by actual products you can buy now. 

Canon is diversifying but it still is mostly a consumer company (blaming compacts and office show that) and consumers are slowly losing patience and moving away or directly disappearing (paperless offices, smartphones, social media storage). It won't go kaput and definitely it can bounce back if they start cannibalizing their lines, but I have a hard time imagining their management just doing that.

Man, this discussion would be better on a bar with a cold beer in the hand.

[Andrew Reid]

It's important to pay attention to the facts in this case.

The world economy has issues, with slowing growth in China and stagnant growth in Europe. Even Apple just posted a 13% decline in quarterly sales, their first in 13 years https://www.theguardian.com/technology/2016/apr/26/apple-iphone-first-revenue-decline-13-years

So although Canon are facing tough headwinds, the Tesla comparison isn't comparing like-with-like. Of course you can't expect a company making the size of investment in technology they are in terms of completely new reusable spacecraft, new kinds of factories, the largest lithium ion battery plant in the world and automotive technology to make a profit during such an ambitious growth phase lead by outside investment, laying the foundations for future profits. They are creating a new industry. Canon are simply coasting along in an existing one and their products have matured fully.

Canon's specific problem is this -

(And it is backed up by the facts and figures, when you look at their sales numbers)

Interchangeable lens products mature, not enough innovation or reason to upgrade. 6 year old 5D Mark II still serves most people well enough.

Compact camera market facing extinction and obsolescence, due to lack of consumer desire for an offline camera in era of smartphones.

Office equipment sales down mainly due to economy slowing in places where previously sales had spiked (developing countries)

Canon recognise that the imaging market has matured to the point where it will have to change completely in order to grow fast again, so they see more profit in business to business endeavours, broadcast, cinema, network cameras - stuff with very high margins and potentially very high sales growth. Unfortunately for Canon it already HAS changed completely into an online world lead by Apple and Google.

In the coming years I think Canon will become what I always predicted, a company that moves away from the consumer camera market and becomes parts supplier to other more innovative companies, until eventually time will pass them by and they become Kodak with a few office equipment products and sensors.

[Jimmy]

28 minutes ago, Ivanhurba said:

Man, this discussion would be better on a bar with a cold beer in the hand.

Every discussion is!

Again, my point about stepping back from our own needs is relevant here though... The 80D has a very specific target for video shooters, namely vlogger, travellers, instagrammers and such. They want good AF, Wifi and good colour over 4K. I would never buy it, but I guess others are

[Andrew Reid]

20 hours ago, eleison said:

But yet, share holders are willing to give Tesla a high market cap.  Say what you want, investors as a whole believe in the company.  In one of Tesla's latest press release, telsa blames themselves and their "hubris" for not meeting their production numbers.  When has Canon done something similar and followed through?  Canon is spinning in it's press releases.  That's not a good sign.  After a while, it might actually believe it's own spin. It might already have.

You're absolutely right about Canon spinning, they highlight the 80D's strong sales in their financial report, but it's barely been on the shop shelves for more than a couple of weeks.

Furthermore in Berlin, one of the 5 largest capital cities in Europe, neither of the two largest electronics retailers stock it yet, it's only there in small quantities in the specialist photography stores and they haven't exactly seen it flying off the shelves either.

Worldwide, sure I expect it to sell well but for how long? Every Canon camera sells to a large loyal customer base upon release and shops expect to sell a lot of them, so order a lot of them, but I just sense that the reason it hasn't hit the major stores in Berlin yet hints to an underlying decline - that they still have so much 70D left to sell, it doesn't make sense for their buyer to contact Canon about getting a bunch of 80Ds in yet.

[Jimmy]

They'll continuing selling to consumers in huge quantities... Alot of consumers are plain dumb... They think that a bulky DSLR is what sets them apart from the iphone crowd... They don't even look at mirrorless options, as they are not big and bulky, so cant be good enough. I was in Portugal last week and any photo being taken was either on a phone or a Canon/Nikon DSLR.... No exceptions.

It is easy for us to know that X mirrorless camera would be way better for someone going travelling around Europe.. But some consumers just buy what they know, be it a brand (Canon) or a type of camera synonymous with quality (DSLR).

The bubble has burst for Canon and Nikon due to smartphones, they will never have the same insane profits as in their heyday, but they are going nowhere anytime soon, professional or consumer. I would bet my house on it 100 times over