"They took our Rebels!" - Q2 fares worse for Canon's imaging division

[D13H4RD]

Stop me if you've heard this one before. "Camera sales declining because smartphones"

 

Well, it's much the same story here, as Canon's report for Q2 comes out, and as per expectations, the imaging division continues to post a dip in sales, albeit much more significantly than before.

Quote

The full financial presentation includes results for all of Canon’s businesses, including the Medical Systems business where the company experienced double-digit growth. That’s where the good news ends, unfortunately.

 

The Imaging System business—which includes cameras and inkjet printers—saw a Net Sales decrease of 18.5%. If you break Cameras out by themselves, you’ll see that this segment actually saw an even steeper decline, posting a 24.9% decrease as compared to Q2 of 2018. Unit sales for the second quarter also decreased by 22%, and Canon adjusted its full year projections to account for these declines.

While this slide is mostly in the sales of the entry-level lineup of ILCs such as the Rebel lineup (which has historically been where Canon's bottom line mainly stems from when it comes to digital imaging products), sales of higher-end cameras are also on a slight dip, mainly owing to Canon's slow entry in the high-end mirrorless market. Although Canon expects this segment to improve as a higher-end body and future RF lenses come to play.

Quote

When presenting this material, Canon’s Executive Vice President and CFO Toshizo Tanaka admitted that the company continues to expect camera sales to decline. “In Imaging System, we expect sales and profit of interchangeable-lens cameras to decline, due to the continued impact of mainly entry-class DSLR market contraction,” said Toshizo-san. “However, in the area of mirrorless cameras, where we are focusing our energy, the effects of expanding our lineup will continue to lead to sales growth.”

 

As for how exactly they’ll do this, Toshizo-san called out three strategies. They will “enhance our lineup launching 5 new lenses for mirrorless cameras” and bundle the EOS R cameras “with accessories like our lens adapter that makes it possible to use our existing rich lens lineup”; they will “further strengthen our efforts to generate user interest in our mirrorless cameras,” by creating more “touch-points” where people can actually get hands-on with the EOS R system; and they will target the professional market to “foster trust in our products, offering, among others, enhanced support at international sports events.”

Essentially, focus is shifting from the lower-end to the higher-end market, where the market size is much smaller and where sales over time are much lower but returns per unit can be much higher.

 

Time will tell on how well companies like Canon and Nikon can adapt to this shift in the market, given how the smartphone is eating away at the low-end and competition is only getting stiffer in the high-end.

 

Source: PetaPixel

 

Opinions

Spoiler

Predictable? Probably, but also not much in the way of being surprising.

 

I think everyone knows at this point in the game that the low-end casual market is increasingly being eroded, especially in the age where a smartphone produces photos that are generally regarded as "good enough" for typically casual purposes, combined with the integrated and connected nature of the typical smartphone. While there will still be a market for low-end interchangeable-lens cameras, it'll likely be much too small to even consider putting more resources into it. 

 

And it's not like the high-end is any easier, where competition is only getting stiffer. Canon and Nikon arrived in the high-end mirrorless segment rather late, allowing companies like Sony and Fujifilm (albeit on APS-C in the case of Fuji) to get a bit of a head start with their respective high-end market offerings. Whilst Canon and Nikon have appealing options for their first iterations (Canon's RF lenses are incredible albeit pricey whilst the Nikon Z line have interesting features albeit without much native glass at this time), the market isn't nearly as straightforward as it was, so it'll be interesting to see how this evolves. Also worth noting that the high-end market don't upgrade their gear nearly as often.

 

[goto10]

canon still exist?!?

[D13H4RD]

Just now, goto10 said:

canon still exist?!?

Yes, yes they do indeed.

[goto10]

12 minutes ago, D13H4RD said:

Yes, yes they do indeed.

if they keep going like this, not for long!

[D13H4RD]

1 minute ago, goto10 said:

if they keep going like this, not for long!

Eh, they'll still stick around, just mainly in the high-end.

 

A lot of working professionals still use Canon gear for a variety of reasons. Just don't count on a lot of enthusiasts staying with the brand long-term.

[GDRRiley]

24 minutes ago, D13H4RD said:

Eh, they'll still stick around, just mainly in the high-end.

 

A lot of working professionals still use Canon gear for a variety of reasons. Just don't count on a lot of enthusiasts staying with the brand long-term.

The one thing I will still give them credit for is making it very hard to over heating their cameras. Many sonys and reds with over heat in minutes if its hot or humid out 

[D13H4RD]

Just now, GDRRiley said:

The one thing I will still give them credit for is making it very hard to over heating their cameras. Many sonys and reds with over heat in minutes if its hot or humid out 

They've been heck reliable for tough situations. I know the 5D and such can take such a beating before they eventually give up.

[iamdarkyoshi]

I guess it might be time for them to start getting into the smartphone division, like red did

 

A cannon smartphone with a stock OS, a camera with performance between average smarphone and real camera, chunky sized (maybe even replaceable) battery, and solid IO would be really sweet. Combine the stuff a smartphone user and camera user might need into one product, and make it not stupid, and I'd probably buy it

[scottyseng]

I'd be interested to see a Canon smartphone too. Dual Pixel AF on a phone sounds nice.

 

Aside from cameras though, Canon's printers are pretty well known too. I didn't know their medical division did so well though, that's interesting.

[GDRRiley]

13 minutes ago, scottyseng said:

I'd be interested to see a Canon smartphone too. Dual Pixel AF on a phone sounds nice.

 

Aside from cameras though, Canon's printers are pretty well known too. I didn't know their medical division did so well though, that's interesting.

oh hell yeah.

Yeah I love my color laser printer by them.

21 minutes ago, D13H4RD said:

They've been heck reliable for tough situations. I know the 5D and such can take such a beating before they eventually give up.

Yeah I just got an SL2 to replace my T5. The -0D are some rock solid other than no 4k but the EOS R and RP has it.

UGH just stop changing mounts stuck to 1 or 2 please. 

[scottyseng]

Just now, GDRRiley said:

Yeah I love my color laser printer by them.

Oh nice, I also have a canon color laser. I have their professional inkjet for posters as well. Never had any issues at all.

[Zodiark1593]

23 minutes ago, iamdarkyoshi said:

I guess it might be time for them to start getting into the smartphone division, like red did

 

A cannon smartphone with a stock OS, a camera with performance between average smarphone and real camera, chunky sized (maybe even replaceable) battery, and solid IO would be really sweet. Combine the stuff a smartphone user and camera user might need into one product, and make it not stupid, and I'd probably buy it

Hmm, wonder if you can fit an m4/3 sensor onto a phone, and then be able to slap on an interchangeable lens when you need to take pictures?

 

Sony has kind of been kicking butt in the camera department, and not just in bodies. Sony sensors are everywhere. Even my Canon camera has a Sony sensor in it.

[D13H4RD]

33 minutes ago, iamdarkyoshi said:

I guess it might be time for them to start getting into the smartphone division, like red did

 

A cannon smartphone with a stock OS, a camera with performance between average smarphone and real camera, chunky sized (maybe even replaceable) battery, and solid IO would be really sweet. Combine the stuff a smartphone user and camera user might need into one product, and make it not stupid, and I'd probably buy it

That'd be difficult because, well, almost every smartphone has an image sensor made by Sony, especially as a contractor for custom designs. 

[Bcat00]

I don't know why Canon is blaming the smartphone for their failure. My friend is a huge photo guy and I asked him whats the take on Canon's losing sale. First thing the guy said is they're outdated and will only buy Sony and Fuji. 

 

There you go people, smartphone is taking the low end market but the market that is the bread and butter of this camera industry has left Canon behind.

[GDRRiley]

1 hour ago, Zodiark1593 said:

Sony has kind of been kicking butt in the camera department, and not just in bodies. Sony sensors are everywhere. Even my Canon camera has a Sony sensor in it.

Their sensors have been for years but their bodys need a bit of work.

I live in California, and it ins't un common here for Sony and other cameras to overheat while filming. (I'm looking at you RED)

 

[D13H4RD]

33 minutes ago, Bcat00 said:

I don't know why Canon is blaming the smartphone for their failure. My friend is a huge photo guy and I asked him whats the take on Canon's losing sale. First thing the guy said is they're outdated and will only buy Sony and Fuji. 

Kinda goes both ways, really.

 

There are people out there who will still prefer to stick with the Canon system either due to their lenses or because it's more beneficial to stick to them in regards to cost (for reference, Sony and Fuji drop quite a bit in resale after a relatively short period of time). They may be outdated from the specs perspective, but I find them more than serviceable for work, especially when the going gets a little tough. 

 

Nearly all camera manufacturers are affected by the smartphone. Sony and Fuji kinda have their own way to mitigate its effect (Sony mainly focuses on the higher-end of the spectrum and their image sensor business benefits either way anyhow, whilst Fuji's Instax lineup continues to be quite the hot seller, whilst also mainly focusing on the higher-end with the X and GFX line).

[porina]

2 hours ago, goto10 said:

canon still exist?!?

I haven't checked recently but they were by far the largest photographic equipment manufacturer, well ahead of 2nd place Nikon and Sony in third. I don't know if that is still the case today, but it was not that long ago. Sony are probably in a good position to overtake Nikon at some point.

 

2 hours ago, iamdarkyoshi said:

I guess it might be time for them to start getting into the smartphone division, like red did

 

A cannon smartphone with a stock OS, a camera with performance between average smarphone and real camera, chunky sized (maybe even replaceable) battery, and solid IO would be really sweet. Combine the stuff a smartphone user and camera user might need into one product, and make it not stupid, and I'd probably buy it

Many have tried. None have succeeded. The problem is, unless you want a phone with a serious bulge, you're essentially going to have a camera in the lower end compact level. Still better than most smartphone cameras, but not the sort of thing a more serious photographer would look for. 

 

Whichever company it was that did the trypophobia phone I think is on the most logical track. Multiple "cameras" distributed on the phone back to allow synthesis of an image more closely resembling bigger sensor output.

 

I suppose on that note, it is not about sensors and big optics any more. It will be more about how good your software it. I don't think a traditional camera company will be leading that area.

 

1 hour ago, Zodiark1593 said:

Hmm, wonder if you can fit an m4/3 sensor onto a phone, and then be able to slap on an interchangeable lens when you need to take pictures?

m4/3 has a relatively large registration distance for the mirrorless space. It's gonna be thick or you have a bulge.

 

Didn't Sony at one point make a strap-on E-mount adapter for mobiles? That's probably the closest you're gonna get. BTW I got the zoom camera module equivalent of that. Quality of image was great, but the practicalities of using it just wasn't giving the experience you want from a "real" camera.

 

25 minutes ago, Bcat00 said:

I don't know why Canon is blaming the smartphone for their failure. My friend is a huge photo guy and I asked him whats the take on Canon's losing sale. First thing the guy said is they're outdated and will only buy Sony and Fuji. 

Photographers have switched brands since forever. What one person likes is not what another does. Not that dissimilar to PC parts and the eternal battles, you get the right build for the tasks you need it to do. There is no one right answer. 

[D13H4RD]

4 minutes ago, porina said:

I haven't checked recently but they were by far the largest photographic equipment manufacturer, well ahead of 2nd place Nikon and Sony in third. I don't know if that is still the case today, but it was not that long ago. Sony are probably in a good position to overtake Nikon at some point.

From what I've heard, not too long ago, Sony did actually overtake Nikon.......just

 

Could've swapped back by now though

[Zodiark1593]

5 hours ago, porina said:

 

 

I suppose on that note, it is not about sensors and big optics any more. It will be more about how good your software it. I don't think a traditional camera company will be leading that area.

 

From what I can tell, phones don't implement anything we hadn't already seen in photo editing. Stacking and exposure bracketing are both employed to improve noise and dynamic range respectively, both weaknesses of small sensor cameras. Nothing super magical there besides the automation, though the results tend to be quite good, and for general purpose shooting, modern phones are fine.

 

More speciality applications are a sore point however. Phones are generally limited in the ability to vary the aperture size, as diffraction becomes a limiting factor much more quickly with highly pixel dense sensors. Strong ND filters will be required for slow exposures. 

 

High speed, low light photography is another application unamendable to leaning on software, especially if the telephoto camera is to be used, as you need both very fast lenses, and high usable ISOs (the iPhone peaks at about 2300 ISO) to achieve the shutter speeds required for a sharp photo.

 

Admittedly, the general user isn't concerned with the more fringe applications.

[BuckGup]

Maybe if Cannon simply released what people wanted. The C100 is a pro grade camera and it can only do 1080p? Sure it’s a bit old now but all the competitors at the time could do 4K 30fps and 1080p 240fps. Ever heard of mirrorless cannon? People want that and not just two cameras to choose from

[realpetertdm]

It seems to be a general trend in the tech industry to have low earning right now. Almost all companies are dropping profit in some area or another.

 

Xerox is also estimating revenue decreases too

[goto10]

canon still makes printers?!

[porina]

24 minutes ago, Zodiark1593 said:

Phones are generally limited in the ability to vary the aperture size, as diffraction becomes a limiting factor much more quickly with highly pixel dense sensors.

I don't disagree with what you wrote, but at the same time you illustrate why traditional photography companies will struggle. The goal isn't necessarily to achieve output comparable to traditional photography, but to use more modern techniques to go beyond that. Multiple optical systems can be used to synthesise an effective aperture as big as its overall diameter. One of the biggest problems I had when I used to frequent photography forums is the mentality that every single output pixel has to be great. If you can overcome that mindset, it frees you to many more possibilities.

 

By no means am I suggesting the death of traditional approaches either. I still own a substantial chunk of Canon DSLR and lenses. A smartphone, current or future, is not going to replace it in every application. Nor do I see a desperate need to go "mirrorless" just because some consider it the new fashion. It has its own advantages and disadvantages. In time I may switch, but that time is not now.

21 minutes ago, BuckGup said:

Maybe if Cannon simply released what people wanted. The C100 is a pro grade camera and it can only do 1080p? Sure it’s a bit old now but all the competitors at the time could do 4K 30fps and 1080p 240fps. Ever heard of mirrorless cannon? People want that and not just two cameras to choose from

I never followed the video side, but while Canon were late to the mirrorless game, they are certainly not out. They released (low end) mirrorless cameras years ago, although the buzz this year is that they finally joined the full frame club in that space. Beyond that, I've not followed closely in recent times.

 

I was trying to look up overall worldwide market share earlier and didn't manage to find it. However I saw a report for Canon and Sony's home turf of Japan. There is a trade organisation there that gives out high level sales numbers (units, not value). Canon are (just) outselling mirrorless cameras compared to Sony. Having said that, it didn't break down further to models. I'd guess Sony's sales would include a bigger mix of higher end models which have been around far longer, and Canon's will be more low end biased. So, in that specific market, for that specific model range, Sony are probably doing better. 

[D13H4RD]

20 minutes ago, porina said:

I never followed the video side, but while Canon were late to the mirrorless game, they are certainly not out. They released (low end) mirrorless cameras years ago, although the buzz this year is that they finally joined the full frame club in that space. Beyond that, I've not followed closely in recent times.

 

I was trying to look up overall worldwide market share earlier and didn't manage to find it. However I saw a report for Canon and Sony's home turf of Japan. There is a trade organisation there that gives out high level sales numbers (units, not value). Canon are (just) outselling mirrorless cameras compared to Sony. Having said that, it didn't break down further to models. I'd guess Sony's sales would include a bigger mix of higher end models which have been around far longer, and Canon's will be more low end biased. So, in that specific market, for that specific model range, Sony are probably doing better. 

Much of that is from the EOS M50, which is one of Canon's best-selling models out there owing to its small size and affordable pricing and solid performance to boot.

 

Only thing is that it uses the EF-M mount, which whilst being one of Canon's first interchangeable-lens mounts for a mirrorless platform, doesn't have much in the way of native lenses, if at all. You're pretty much going to need the EF-M to EF adapter if you plan to expand with an EF-M camera.

 

The RF bodies are kind of slow to start despite the RP initially selling well. My guess is that long-time Canon faithful are still holding onto their DSLRs for the time being until Canon releases the long-rumored high-end body and enthusiasts may have already switched. The RF system is firmly in the upper-end spectrum though, as its lens prices currently show. For real though, the EOS R is pretty good as a stills body.

[Zodiark1593]

2 hours ago, porina said:

I don't disagree with what you wrote, but at the same time you illustrate why traditional photography companies will struggle. The goal isn't necessarily to achieve output comparable to traditional photography, but to use more modern techniques to go beyond that. Multiple optical systems can be used to synthesise an effective aperture as big as its overall diameter. One of the biggest problems I had when I used to frequent photography forums is the mentality that every single output pixel has to be great. If you can overcome that mindset, it frees you to many more possibilities.

Photography is an art. All that matters is the final result, and how closely it matches your vision. How it's achieved is hardly relevant, though at the same time, I will use whatever tool I've available to achieve it. If a phone can do the job, I've nothing against it at all. If you need the latest full frame and fast lenses for whatever poorly lit, high speed shooting you need to do, so be it. 

 

Though this doesn't address the struggles Canon will go through. 

 

On an aside, I really have the itch to get a disposable camera for some shooting.