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05-14-2016, 02:26 PM   #1
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Grim Nikon Financials

QuoteQuote:
Nikon didn’t just report weaker Imaging business sales for the year yesterday, their entire report could only be characterized as “grim.” Here’s how the Imaging business looks quarter by quarter for the last four years (straight line is a moving average).



05-14-2016, 03:20 PM   #2
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Interesting analysis, but he does state that the overall company profits are expected to rise thanks to the precision division. Times must be tough for a company that has had so much of its former profits from a rapidly shrinking/evolving market. Its good that Pentax's market share is so small that it doesn't hurt nearly as much.
05-14-2016, 05:41 PM   #3
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it's really about sony taking ff market share from nikon, which is a trend that will continue to get stronger.

it's funny how he's calling for a d810 replacement, when in fact the d810 is not obsolete by dslr standards, in fact it still does several things better than the new k-1... slightly higher burst rate, better d.r. at base iso, efcs in mup mode, better flash system, more lens options, etc.

it's just overpriced at $2700... if nikon lowered their camera body pricing to realistic levels, it would put a hurt on canon, pentax, and even sony to some extent.
05-14-2016, 05:49 PM   #4
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Sony is not the reason for weak profit at Nikon . Sony said profit was down because of camera module.

05-14-2016, 06:53 PM   #5
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sony is indeed getting hurt with sensor fab for smartphones, because apple is taking a beating, and the market is flattening out overall.

but sony is still one of the big three when it comes to cameras, the a7 series has been a success.
05-17-2016, 06:54 PM - 1 Like   #6
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Nikon mirrorless, large sensor, at Photokina?

Thom Hogan in the same article
News/Views | DSLRBodies | Thom Hogan

predicts at Photokina, either a Nikon mirrorless model of the D3300, (most likely - my words)

or a Nikon large sensor mirrorless.

For Hogan to mention these items, wouldn't he have some inside knowledge? In any case, it would seem beneficial to Nikon to be more diversified than they are now.

Also he writes a lot about quality problems. The search for a country with the lowest wage rates seems to me to be a race to the bottom. However, i don't know if Nikon's current quality problems have to do with manufacturing or design elements.

Last edited by philbaum; 05-17-2016 at 07:08 PM.
05-17-2016, 07:18 PM   #7
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"One that stood out is the 25% increase in provision for warranty repair year to year. People ask me if Nikon knows they have a QC problem. Well, yes, if anyone at Nikon is reading their own financial statements, they know. What we don’t know is what they intend to do about it."

wow...

05-17-2016, 09:22 PM - 1 Like   #8
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QuoteOriginally posted by osv Quote
"One that stood out is the 25% increase in provision for warranty repair year to year. People ask me if Nikon knows they have a QC problem. Well, yes, if anyone at Nikon is reading their own financial statements, they know. What we don’t know is what they intend to do about it."

wow...
Every year, Nikon is having to deal with about !7% reduction in sales; and now they must absorb 25% more cost in warranty work - a double whammy. I would think they would have to come out with a public announcement that they are slowing introductions down and doubling up on quality checks. It'll be costly but they need to get back on solid ground. Another thing they need to nail down - why isn't the public buying their cameras to the degree they used to. Continuous sales reductions are never going to cure themselves. I believe that there's a lot of customers out there that want smaller cameras. Maybe i'm wrong, but whatever is slowing sales for Nikon, they need to poll it and start addressing the desirability of their products.
05-18-2016, 10:07 AM   #9
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i thought that their q.c. problems were over with the greasy shutter incidents.

something else must be going wrong, to run up those warranty repair costs.
05-18-2016, 10:20 AM - 2 Likes   #10
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Sidebar: Every single person on this Forum who has said a warranty doesn't cost anything so Pentax should match Nikon/Canon/Sony/Sigma needs to read that section of the report three times and write a 500 word book report.
05-18-2016, 11:40 AM   #11
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QuoteOriginally posted by monochrome Quote
Sidebar: Every single person on this Forum who has said a warranty doesn't cost anything so Pentax should match Nikon/Canon/Sony/Sigma needs to read that section of the report three times and write a 500 word book report.
Japanese industrialists are the ones who taught the rest of the world, by example, that Quality costs

(1) you can spend money to put it into the original product

(2) you can spend money fixing mistakes, as Nikon apparently is now

(3) your future sales can lag because people no longer trust what they buy from you

Note: I'm still not sure what to make of Pentax's apparent aperture control issues.
the following exchange of posts occurred recently in the K-30/50 sub forum.

QuoteOriginally posted by Tangent88 Quote
Might keep an eye on this thread for a bit though before purchasing that one:
https://www.pentaxforums.com/forums/184-pentax-k-s1-k-s2/320993-dark-frames-k-s2.html
Seems like I've actually got one of the better Pentax cameras
QuoteOriginally posted by reh321 Quote
We still know nothing about mean pictures to failure; there is a lot of talk about failures, but we don't know whether this happens on occasion or whether every camera will "die before its time".
I do carry several M42 lenses around with me to meet my basic "needs", but otherwise I'm just not going to worry about it. Considering the prices of these cameras, they still seem to be a good deal.
05-18-2016, 11:50 AM   #12
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^^ What I meant is, a manufacturer must take a reserve against earnings every year to reflect the present-value cost of future estimated warranty repairs, so from a current earnings standpoint a warranty isn't free. If a manufacturer experiences current-year warranty expenses in excess of estimated reserves, those excess expenses must also be deducted from earnings; and if real-world experience shows the FUTURE reserve is too small, a deduction from current earnings to reserve against higher FUTURE expenses must also be made.

Nikon experienced the second and third additional earnings deductions.

You are correct. They can't get away win under-reserving AND reducing quality.
05-19-2016, 03:35 PM   #13
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Interesting position Nikon is in. They rely sooo much on imaging that they are real vulnerable to market downturns, where Canon, Fuji and Ricoh can weather the storm.
As a consumer, it is a double edge sword. It is nice that a company has to release regular updates of their cameras and lenses, otherwise they cannot compete. On the other hand, they may not exist in 10 years.
05-20-2016, 05:05 AM   #14
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QuoteOriginally posted by philbaum Quote
Every year, Nikon is having to deal with about !7% reduction in sales; and now they must absorb 25% more cost in warranty work - a double whammy. I would think they would have to come out with a public announcement that they are slowing introductions down and doubling up on quality checks. It'll be costly but they need to get back on solid ground. Another thing they need to nail down - why isn't the public buying their cameras to the degree they used to. Continuous sales reductions are never going to cure themselves. I believe that there's a lot of customers out there that want smaller cameras. Maybe i'm wrong, but whatever is slowing sales for Nikon, they need to poll it and start addressing the desirability of their products.
I think Nikon has some problems with cost controls. If Ricoh can make the K-1 at $1,800 and make a profit, then there is no reason that Nikon isn't raking in money with the D810 and the rest of the line. Nikon needs to get lean. They have the technology, brand recognition, distribution, and the customer base. They need to get cost under control.
05-20-2016, 12:34 PM - 1 Like   #15
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QuoteOriginally posted by osv Quote
it's really about sony taking ff market share from nikon, which is a trend that will continue to get stronger.

it's funny how he's calling for a d810 replacement, when in fact the d810 is not obsolete by dslr standards, in fact it still does several things better than the new k-1... slightly higher burst rate, better d.r. at base iso, efcs in mup mode, better flash system, more lens options, etc.

it's just overpriced at $2700... if nikon lowered their camera body pricing to realistic levels, it would put a hurt on canon, pentax, and even sony to some extent.
I'm afraid that Nikon is like this big buffalo with a pack of wolves trying to take it down. Pentax, Sony, Fuji, Olympus are the wolves and are biting off chunks of their market. While trying to competitively defend each and every attack, they are not paying attention to the overall trends of the market. And as reh321 put it so well:

(3) your future sales can lag because people no longer trust what they buy from you

They seemingly have lost their ability to manage their product line. They've got to simplify their product line and put their best people on the quality of those fewer products. The D600 was the "canary in the mine shaft" and they've apparently not corrected the root cause of that initial disaster. Two class action suits resulted and Russia even banned the further import of any D600. Its a perfect storm of
A. Quality problems
B. Cultural shift causing sales reductions every year
C. Competitors that are lean and mean :-)

Will the buffalo go extinct?
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