Nikon published its Q3 2013 earnings and announced that it cut the sales volume forecast for the year ending on March 31 due to dreadful sales in multiple markets across the world.
The financial estimation for the year which ends in March 2013 has been cut down by Nikon. The Japanese company published its Q3 2013 results and due to sluggish camera sales, the annual profit forecast was decreased.
Looking for a scapegoat
Nikon blames the European market for this situation as the demand on the old continent has dramatically diminished. Furthermore, the Chinese market was also to blame as the company had expected to maintain high sale levels in China, but the consumers did not feel the same way.
Things did not go according to plan and business in China was a lot “worse than expected” in the third quarter for the 2013 financial year, said Nikon’s Chief Financial Officer, Junichi Itoh.
Another reason why the company reported such poor financial results was the mid-November camera price decline. Due to strong competition from other camera manufacturers, prices had to be reduced to keep up the sale levels.
Nikon has published a net income forecast of 38 billion yen, which represents about $405 million. This is 37% less than the company’s previous net income forecast of 60 billion yen. Market analysts were disappointed to hear about the camera maker’s forecast as they were expecting a 61 billion yen net income for the year ending on March 31.
Additionally, Nikon cut the dividends per share to 12 yen, down from 21 yen, fact which can be noticed in the company’s financial results of the third quarter which ended on December 31, 2012.
Nikon also cut DSLR camera sales by 100,000 units and interchangeable lens sales by 200,000 units. This means that the company is expecting the trend to continue and analysts are claiming that this is the right thing to do, as it would be foolish to believe otherwise.
Canon is doing better
In the meantime, Canon reported a 14% bigger profit forecast thanks to the weakening yen. Canon also said that the company’s more expensive DSLR cameras and lenses are selling at a faster rate than predicted, therefore it found itself in a position which allowed it to up the net income forecast.
Although it has a more positive outlook for this financial year, the EOS maker is also struggling with poor camera sales. People are buying fewer cameras and they will keep doing so, as the worldwide is not recovering.