Canon lowered its annual profit forecast for the second time this year | Finance and Markets

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Japanese optical products company Canon lowered its annual profit forecast for the second time this year, indicating that this was due to weaker SLR (Single Lens Reflect) and shrinking demand for chip-related equipment.

Canon lowered profit forecast to 335.5 billion JPY (2.99 billion USD) from 378.5 billion JPY. For comparison, analysts expect 375.4 billion JPY.

“The sales of SLR cameras shrank faster than expected, as some consumers have refrained from buying as they expect new Canon devices”, said the Chief Financial Officer, Toshizo Tanaka.

The operating profit for the third quarter shrank by 12.4% to 68.3 billion JPY (610 million USD), compared with a profit of 78 billion JPY an year ago. Canon’s profit did not meet the average forecast of the analysts for 86.57 billion JPY.

The company was initially reluctant to expand its mirrorless line-up, fearing it would cannibalize sales of its flagship single-lens reflex cameras. However, it launched the product after Sony Corp carved out more market share with its mirrorless offerings – popular with consumers as they are much lighter than SLRs.

Canon said the growth in demand for its semiconductor lithography equipment slipped as some memory chip suppliers postponed their investments.

Canon has a 41 billion USD market capitalization, and recently released its first full-size, non-mirror camera, which represents a huge change in its product strategy.