Canon Q3 Operating Profit Nearly Halves on Post-Brexit Yen Strength

[rrcphoto]

A couple of problems here.

First, holiday price reductions are driven by the retailers, not by Canon.

Second, your statement seems to be contradicted by Canon.

I don't believe Canon is going to sit idly by while other manufacturers attempt to steal sales.

as far as the camera industry, canon wields the largest economic club.

it will be curious if on the year end results canon separates their volume out for DSLR's and mirrorless - it would be interesting to see how much they captured for each segment. but there's not a doubt that canon is quite bullish over their presence in both markets now.

 

[AvTvM]

i don't mind at all seeing Canon suffering. Well deserved.
Personally I have not bought anything from them for about 2 years now. Nothing that interested me in their product heap.
And despite the Canon Defense league's denials ... obviously I am not the only one. ;D

Hope Canon will learn the hard way to deliver the products their clients want. Otherwise ... they will go under. Would not be the first big corp I have seen swimming by belly up. Nokia, Kodak .. RIP ... was a good customer of them as long as they made what I and many other customers wanted .. when they stopped ... bye bye baby ... no tears from me.

 

[rrcphoto]

Okay maybe Brexit has hurt the world economy. (We'll only know that in 20 years) But blaming it entirely for a nearly 50% loss of profit is simply ludicrous.

or you don't understand how safe haven currencies work?

 

[rrcphoto]

i loe to see Canon suffering. Well deserved. I have not bought anything from them for about 2 years now. Nothing that interested me in their product heap.

how's canon suffering. they are selling more ILC cameras this year than all other camera companies COMBINED.

 

[AvTvM]

i loe to see Canon suffering. Well deserved. I have not bought anything from them for about 2 years now. Nothing that interested me in their product heap.

how's canon suffering. they are selling more ILC cameras this year than all other camera companies COMBINED.

does not matter. They are selling WAY LESS than they did last year and the year before .. and therefore are way down in profits. Just like when bnack in the 1970s mighty German photo industry was selling *way more range finder cameras* than the rest of the world. Meanwhile Japan was selling SLRs ... history DOES REPEAT itself. Ever so often.

"GÖTTERDÄMMERUNG" ... Nikon first, Ricoh/Pentax, Olympus ... then Canon ... bring it on! 8)

 

[Mt Spokane Photography]

While Canon could drop prices and increase sales, they do not have much margin left to drop prices. I'm sure we will see sales for the Holiday Season, but they may not be as good as in past years where there was a larger margin of profit.

Genuinely curious here; how did you determine what Canon's profit margins are on it's products? I didn't think that product profit margins were something Canon posts about and I'm pretty sure most companies keep that type of information secret.

Did you read their report? They are making less income on sales that are about the same. They attribute it to the increasing strength of the Yen.

 

[rrcphoto]

i loe to see Canon suffering. Well deserved. I have not bought anything from them for about 2 years now. Nothing that interested me in their product heap.

how's canon suffering. they are selling more ILC cameras this year than all other camera companies COMBINED.

does not matter. They are selling WAY LESS than they did last year and the year before .. and therefore are way down in profits. Just like when bnack in the 1970s mighty German photo industry was selling *way more range finder cameras* than the rest of the world. Meanwhile Japan was selling SLRs ... history DOES REPEAT itself. Ever so often.

"GÖTTERDÄMMERUNG" ... Nikon first, Ricoh/Pentax, Olympus ... then Canon ... bring it on! 8)

actually no they are not. wow.. you're batting 100 today

Canon's ILC sales are basically the same as last year, sitting at -1% YoY.

perhaps spend a few minutes reading the reports and you MAY actually look half decently intelligent. it's a stretch but .. it just MAY happen.

 

[IglooEater]

Okay maybe Brexit has hurt the world economy. (We'll only know that in 20 years) But blaming it entirely for a nearly 50% loss of profit is simply ludicrous.

or you don't understand how safe haven currencies work?

There are many, many things in this world I don't understand. Care to explain?

 

[Tom W]

It's an exchange rate issue essentially. And things changed considerably as a result of the Brexit. But that's temporary. It hurts today, but 2-3 years from now, things will have worked out. And, Britain will be Britain again.

 

[IglooEater]

It's an exchange rate issue essentially. And things changed considerably as a result of the Brexit. But that's temporary. It hurts today, but 2-3 years from now, things will have worked out. And, Britain will be Britain again.

Thanks, that's pretty much what I figured.

 

[douglaurent]

I just wrote the text below in another forum thread - much weaker sales than in the years before can't all be blamed to a Brexit or the rise of camera phones alone. This is also one of the reasons:

People say that camera sales are massively falling because of smartphone use - but nobody talks about one major difference between smartphones and DSLRs:

- With a current iPhone 7 or Samsung S7, hardly any realistic wish for features and functions is left open. It's very hard to imagine which real essential things the manufacturers should come up with in the future. If you own one of the top smartphones of one of the leading manufacturers, there are no real reasons to complain about the few specs that are better in the competitor's product. You can survive with the functions of the current smartphones for decades, and it feels like as if everything's there.

- With a Canon DSLR that is 5-10x as expensive, you can easily make a realistic future wish list of a few dozen relevant missing points, because those functions are already implemented in lots of other existing products by the competition (many in mirrorless cameras). While the quality of the cameras is great in itself and you can use them for many years to come, a lot of things are limited, and logistics and workflow are not as convenient as they can be. A lot of extras and multiple devices need to be bought to be able to have allround capabilities.

Final result is: A 2016 smartphone just feels good and not like an expensive thing to buy for what it gives you. A 2016 Canon camera feels expensive, because you know the company has left out many things and didn't even pretend to try to release the best they can do. That is also the main difference to Sony. An A7RII or A99II feel much more as if it's the best Sony could come up with at the time.

Maybe Canon should try to release products that include all they can give at the moment, and more people than now will see the reasons why it makes sense to buy them and feel good about it, although they have a smartphone and/or an older Canon product.

 

[CanonGuy]

I hope canon learns to respect their customers. Both my 5d3s were due for upgrade this year. Then canon releases a disappointment and named it 5d4! Come one! You took 4 years to release this $hit?! I don't see ANY reason why I'll get myself a 5d4! I don't care about video. You could spend less time blaming brexit and spend some time on r&d.

 

[rrcphoto]

Okay maybe Brexit has hurt the world economy. (We'll only know that in 20 years) But blaming it entirely for a nearly 50% loss of profit is simply ludicrous.

or you don't understand how safe haven currencies work?

There are many, many things in this world I don't understand. Care to explain?

when there's a disruption in the world people tend to flock to what's called safe haven currencies such as the Yen, and purchase that. Driving the price of the Yen up. when the yen is priced higher, Canon Japan gets less money for each camera or printer they sell to the USA, Europe,etc well anywhere in the world BUT Japan.

so if you by default make around 10-15% profit per widget, it doesn't take much of a currency change for your widgets to make far less profit. a 5% change can easily eat 1/2 to 1/3 of your profits.

Canon estimates that the change of currency caused losses of 1 billion USD to Canon Japan. not exactly small change.

But even with that .. this is Canon overall .. looks like Office took the major hit, ILC's are going strong .. demand is good, sales are the same as last year - it's hard to say this is caused by an ILC problem.

it's always funny to see a report like this .. and everyone starts complaining about a particular camera as THE REASON... canon is a huge company and spreading out even more so after purchasing Toshiba's medical division.

 

[neuroanatomist]

Maybe Canon should try to release products that include all they can give at the moment, and more people than now will see the reasons why it makes sense to buy them and feel good about it, although they have a smartphone and/or an older Canon product.

The ILC market is dropping significantly, Canon's ILC sales dropped 1%. Seems Canon is doing well, better than expected, in spite of your dissatisfaction.

Final result is: your opinion doesn't hold up well in the face of reality.

 

[Woody]

Final result is: A 2016 smartphone just feels good and not like an expensive thing to buy for what it gives you. A 2016 Canon camera feels expensive, because you know the company has left out many things and didn't even pretend to try to release the best they can do. That is also the main difference to Sony. An A7RII or A99II feel much more as if it's the best Sony could come up with at the time.

Regardless of what you say above, Canon has 50% of ILC market share while Sony is stuck with their ~ 13% market share for many years now and Nikon is losing ~ 5 to 10% of their market shares to Canon.

So, how do YOU explain that?

 

[unfocused]

...A 2016 smartphone just feels good and not like an expensive thing to buy for what it gives you...

That's your opinion, but certainly not mine. I think smartphones are ridiculously overpriced, especially since they are purposely made to have screens that crack easily and batteries that die as soon as your contract is paid off. I've never had to replace a camera (Canon or otherwise) because it quit working. But, I have replaced any number of smartphones simply because they either broke or stopped working.

 

[dsut4392]

I just wrote the text below in another forum thread - much weaker sales than in the years before can't all be blamed to a Brexit or the rise of camera phones alone. This is also one of the reasons:

People say that camera sales are massively falling because of smartphone use - but nobody talks about one major difference between smartphones and DSLRs:

- With a current iPhone 7 or Samsung S7, hardly any realistic wish for features and functions is left open. It's very hard to imagine which real essential things the manufacturers should come up with in the future. If you own one of the top smartphones of one of the leading manufacturers, there are no real reasons to complain about the few specs that are better in the competitor's product. You can survive with the functions of the current smartphones for decades, and it feels like as if everything's there.

- With a Canon DSLR that is 5-10x as expensive, you can easily make a realistic future wish list of a few dozen relevant missing points, because those functions are already implemented in lots of other existing products by the competition (many in mirrorless cameras). While the quality of the cameras is great in itself and you can use them for many years to come, a lot of things are limited, and logistics and workflow are not as convenient as they can be. A lot of extras and multiple devices need to be bought to be able to have allround capabilities.

Final result is: A 2016 smartphone just feels good and not like an expensive thing to buy for what it gives you. A 2016 Canon camera feels expensive, because you know the company has left out many things and didn't even pretend to try to release the best they can do. That is also the main difference to Sony. An A7RII or A99II feel much more as if it's the best Sony could come up with at the time.

All of which bodes well for future pro/prosumer DSLR/ILC sales (room for improvement to sell you a new model in 2017+...), and poorly for smartphone sales (what more could you need?):/ Remind me again where you thought this argument was taking you?

Realistically, smartphones and high end ILC are quite different markets, with smartphone sales sustained by cheap debt and a 'consumable' mentality ("free" on contract, everyday use item, toss it out and get a new contract in 2 years or less) whereas some people seem to expect a DSLR should be perfect and feature complete now, last forever, and cost less than ever. If you take out the cross subsidy from your telco contract, top-end smartphone prices to me seem like a very expensive and poor value for money item if you churn through them every couple of years as most people do. It will be interesting to watch smartphone sales over the next few years to see if what you have said (and I agree with) about phones doing everything they need to sinks in, and people stop spending the ridiculous sums they are now.

I also agree with you that blaming weaker sales of ILCs on currency fluctuations alone is unrealistic, but believe the reason has a lot more to do with 2014 models already being good enough for all intents and purposes for everyone but a very limited subset than it has to do with new 2016 models not being good enough. Sell me a perfect camera once, and you can kiss my business goodbye forever after. Trickle out some new features every couple of years and I'll keep buying every second model when something I actually want comes along, or the urge to spend some money comes on. If you are one of the few people that really does need more than you can get out of the 5D4 or any other camera body alone, then there are the specialized tools out there to fill those niches. Unless you're planning on doing something about how capitalism works, there's not much point in ranting about it.

 

[sanj]

Market saturation is a reality. And happens regularly. Then a company comes along and brings along a revolutionary product (5d2, Iphone, iMac etc.) and sales hit the roof but the saturation cycle starts again.

Lets see if it is possible for a company to launch a camera which is innovative enough for many to want to sell off their current cameras and buy the new product.

 

[sanj]

...A 2016 smartphone just feels good and not like an expensive thing to buy for what it gives you...

That's your opinion, but certainly not mine. I think smartphones are ridiculously overpriced, especially since they are purposely made to have screens that crack easily and batteries that die as soon as your contract is paid off. I've never had to replace a camera (Canon or otherwise) because it quit working. But, I have replaced any number of smartphones simply because they either broke or stopped working.

My experience has been different. I have lots of family members (especially the older ones) who have been using their phones for many years and refuse to upgrade as it works fine. I personally have sent my Canon for repairs several times and never my phone. This is my experience.

 

[Mancubus]

I hope canon learns to respect their customers. Both my 5d3s were due for upgrade this year. Then canon releases a disappointment and named it 5d4! Come one! You took 4 years to release this $hit?! I don't see ANY reason why I'll get myself a 5d4! I don't care about video. You could spend less time blaming brexit and spend some time on r&d.

Exactly, from me, that's at least $3500 they missed out. I was planning to upgrade from a 5d3 as well, but I don't see the point