Nikon's third quarter financial results have been announced, and the news, as expected, is mixed.
For the year so far, Nikon sales are down 16% from the year prior, and the company is now reporting a loss. Hidden in that bad news is that this year's third quarter is better than last year's (hard not to be, given that the Great Recession was hitting about its heaviest during that period last fiscal year). The Precision division (semiconductor equipment) continues to collapse, with year-to-year comparison now off 39%. That, of course means that the Imaging division (cameras and lenses) is doing better, with sales off 9% and profits off only 4% from the previous year-to-date (three quarters).
Indeed, one of Nikon's bullet points for the quarter was that DSLRs, lenses, and compact cameras all achieved their highest single quarter volume to date: 1.2m DSLRs, 1.75m lenses, and 4.1m compact cameras were "sold" in the last three months of 2009. For the full fiscal year (ends March 31, 2010) Nikon expects to sell 3.5m DSLRs (35% of the global market), 5.1m lenses (32% of the global market), and 11.5m compact cameras (11.7% of the global market). Japan is now down to 12% of Nikon Imaging sales, the US down to 34%, Europe holding steady at 32%, with the remainder being Asia (22%). Imaging's percentage of the overall company sales continues to grow, having risen to 76% in the three quarters so far (but expected to drop back to 73% for the full year).
R&D expenses as a percentage of sales is still increasing (and has been for most of the decade), though the overall spending has dropped a bit (about 4% year-to-year).
Nikon's current estimate for currency exchange is 90-94 yen to the dollar, 130-133 yen to the Euro (the actual rate is at about 91 and 127 as I write this).
Overall, Nikon's continued strong performance in Imaging is driving the company. The good news is that this performance currently shows little signs of weakening. On the other hand, Nikon can't afford to make significant mistakes with cameras and lenses in the coming months, as doing so would send the financial picture back into the red (they predict a profit for the coming year).
Looking beyond the numbers looking for clues to the coming quarter, Nikon did not change their estimates for camera, lens, or Coolpix sales in the current quarter. That pretty much means that nothing that's been announced (see next story) or will be announced shortly is going to have a meaningful impact on this year's financials. Despite selling 1.2m DSLRs last quarter, Nikon currently expects to sell only 700k DSLRs this quarter. Note the the Coolpix models announced below only have a couple that ship in March. If Nikon expects to beat their 2010 fiscal year numbers they just posted in 2011, and every indication is that they do, that means that we've got quite a few new products coming in the next two quarters.