With 2021 properly and actually over, these producers that align their funds to the calendar yr are actually producing their monetary stories. Canon’s newest figures reveal sturdy and sustained efficiency, even in the course of the pandemic, which is a results of its shift to mirrorless digital camera manufacture and facilitating the start of a brand new market dominance.
Here’s a look into what Canon’s newest monetary report reveals concerning the firm’s present standing and trajectory within the digital camera business.
The Loss of life of the DSLR and the Rise of Mirrorless
The emergence of the COVID pandemic got here on the fallacious second for a digital camera business already rocked by the implosion of gross sales that led to an enormous contraction of the market and exodus on once-household names. It didn’t begin there, because the seeds sown by Sony with the discharge of the E-mount and subsequent Alpha 7 known as the demise knell on the DSLR.
What is clear greater than ever – and notably wanting on the CIPA cargo knowledge for 2021 – is that the mirrorless digital camera is now the beating monetary coronary heart of the business, accounting for 38% of models shipped however 67% of worth. In actual fact, the information comes thick and quick: Ricoh tries a “workshop-like” manufacturing mannequin for Japanese DSLR clients, Canon shuts down its final remaining Chinese language manufacturing facility (Zhuhai) largely ending built-in digital camera mass manufacturing, and the BCN Awards present that Canon and Sony are stealing the present.
It is a pivot like no different the business has seen, and it’s largely cut up into two camps: Sony, Fuji, Olympus, and Panasonic all developed viable mirrorless methods from the get-go within the early 2010s and have seen success to a higher or lesser extent. Canon, Nikon, and Pentax tried options that had been predominantly failures as a result of they had been by no means meant to switch their money-making DSLR.
Canon and Nikon have needed to change their digital camera methods at a time of dramatically falling gross sales, diminishing market share, and now COVID.
A Look Into Canon’s 2021 Financials
So how did Canon fare? The headline outcomes from the entire enterprise are an 11.2% enhance in internet gross sales to ¥3,513 billion (~$30 billion), up from ¥3,160 billion and ¥3,593 billion within the pre-COVID 2019 yr, virtually bringing it again to parity. Working income rose 155% to ¥282 billion and beat 2019 by some margin. It is a results of elevated gross sales in 2021 however considerably decrease prices than 2019 ensuing from medium-term restructuring (and it’s important to think about that the Zhuhai manufacturing facility closure was a part of this).
So, whereas total enterprise is doing properly — very properly — how is the Imaging Division performing? Firstly, the Printing Division is, by a big margin, crucial to Canon accounting for 55% of gross sales and 60% of working revenue. Imaging is the second-largest division with 19% of gross sales and 21% of working revenue.
All divisions more-or-less bounced again to pre-COVID ranges of gross sales, however Imaging did notably properly (20.7% enhance in Web Gross sales to ¥654 billion) partly as a result of it was impacted extra severely than Printing. Given the improved efficiency throughout all divisions, Canon expects to see a ten% enhance in Web Gross sales for 2022 principally coming from Printing and Imaging.
It’s value noting that Canon has restructured the reporting of its divisions; surprisingly Inkjet Printers used to function inside Imaging, however this has now moved to Printing, a division renamed from “Workplace” and incorporating all its print applied sciences. Canon makes all comparisons retrospectively in order that the requisite teams are in the suitable divisions.
Canon goes on to offer extra element round its Imaging Division, splitting its merchandise into “Cameras” and “Community Cameras & Others”. “Community Cameras” account for 34% of internet gross sales, though the final “Cameras” space is of extra curiosity and noticed a 24.6% enhance in internet gross sales. Canon confirms gross sales of two.74 million interchangeable lens cameras, a drop of 1% versus 2020.
CIPA knowledge for 2020 stories a complete of 5.27 million models shipped, near Canon’s determine of 5.38 million, which the corporate believes will enhance to five.65 million models. It additionally means that Canon holds round 52% of the entire ILC market, a outstanding achievement. Canon additionally confirms 1.15 million compact digital camera shipments, representing 38% of the CIPA cargo knowledge and pretty near the 34.1% proven not too long ago within the BCN Award knowledge.
The Digicam Business in 2022 and Past
Provided that mirrorless cameras are the one class that elevated shipments, my expectation is that mirrorless models may even see cargo development to round 3.5 million models. Canon will wish to be grabbing as a lot of that increasing mirrorless pie as attainable and — surprisingly — tasks grabbing all of it! As I’ve famous earlier than, and maybe counter-intuitively, Canon expanded DSLR gross sales in 2021 on the expense of Nikon, so it might be seeking to promote additional into this market.
If — and it’s an enormous if — the BCN Award market share illustrates a wider pattern, then Canon will should be taking market share from Sony. This appears unlikely given each historic efficiency and the discharge methods of present producers.
The mirrorless market isn’t just like the DSLR market the place Canon and Nikon have lengthy dominated and Canon has doubtlessly elevated its share to round 60%. There are quite a few, profitable, producers who nonetheless take vital gross sales and, to a big extent, aren’t competing immediately with Canon. Olympus, Fuji, and Panasonic all fall into this camp and none (apart from the Panasonic S1) produce a full-frame vary, but have vital gross sales. Together with Nikon, this group makes up 50% of mirrorless shipments, a major proportion.
With the Zhuhai manufacturing facility closure, it’s fascinating to see that compact digital camera shipments for 2022 are predicted to lower to 600,000. Anticipate to see many low-value fashions pulled from the cabinets as Canon will increase its focus upon the upper worth, greater revenue, phase.
Canon Efficiently Pivoted to Mirrorless
Total, this can be a compelling set of outcomes for Canon that exhibits a extremely profitable pivot to mirrorless, shuttering of its compact cameras, and the consolidation of sources. Its single most necessary purpose is to determine a higher market share within the mirrorless sector, with one eye nonetheless on the DSLR.
If there was one query at the back of Canon’s thoughts, then it may be this: is the previous canine lifeless? The slowing of the DSLR implosion suggests there may properly be an extended tail (oh expensive!), so is the unthinkable attainable? Would possibly we see a brand new (non-flagship) DSLR mannequin hit the cabinets? It won’t occur in 2022, however we’ll know extra about how the DSLR and mirrorless sectors are performing by the tip of it.