Canon Shares Fall After It Posts Operating-Profit Drop on Weak Camera Business

By Kosaku Narioka

Canon Inc. shares fell sharply after it posted a drop in first-quarter operating profit due to higher costs and a fall in revenue from its camera business.

Shares were recently 6.5% lower at 4,150 yen Thursday morning after falling as much as 7.3% earlier.

Canon said Wednesday after market close that operating profit dropped 5.2% from a year earlier to Y80.08 billion ($515.5 million) for the three months ended March as selling, general and administrative expenses increased much faster than revenue.

First-quarter revenue edged 1.8% higher to Y988.52 billion as revenue from its camera business dropped 8.8% despite growth in other segments such as printer, medical and industrial equipment.

Canon said it restricted the shipment of digital cameras and increased sales promotion expenses to reduce the build-up of inventory of cameras in the market.

Net profit rose 6.3% to Y59.95 billion thanks partly to smaller foreign-exchange losses on foreign currency-denominated debt, but quarterly net profit missed analysts' estimates.

Canon kept its earnings projections unchanged for 2024, forecasting a 15% increase in net profit to Y305.00 billion.

Write to Kosaku Narioka at kosaku.narioka@wsj.com

(END) Dow Jones Newswires

April 24, 2024 22:09 ET (02:09 GMT)

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