Canon’s printers power growth amid profit drop
January 30, 2025
Japanese technology group sees robust printer sales but profit hit by medical unit impairment.
Canon’s printing division helped drive revenue growth in 2024, but overall profits slumped as the Japanese technology group took a significant impairment charge against its medical business.
The Tokyo-based company reported record annual sales of ¥4.5tn ($28.5bn/ €26.3bn), up 7.9% year-on-year, surpassing its pre-2008 peak. However, net income plunged 39.5% to ¥160bn ($1.01bn/ €940m) after a ¥165.1bn ($1.04bn/ €970m) impairment loss in its medical unit, which struggled amid economic downturns in China and Europe.
Despite the profit decline, Canon’s printing division remained a bright spot, with 7.5% revenue growth to ¥2.52tn ($15.95bn/ €14.76bn) and a 27% surge in operating profit, raising margins to 11.5%. Strong demand for commercial and office printers offset weakness in consumer inkjet sales, which suffered from market contraction and intense price competition.
“Printing remains a key driver of Canon’s revenue and profit performance,” according to Canon’s financial report, highlighting robust office MFD (multifunction device) sales and a laser printer recovery following OEM inventory corrections. Canon’s commercial printing business saw its fourth consecutive year of expansion, buoyed by demand at the Drupa trade fair and new product launches.
Inkjet printer sales, however, declined due to weakness in China and low-end price wars. Canon’s response has been to pivot towards refillable ink tank models, which saw a 2% sales increase, reflecting stronger consumer demand for lower running costs and sustainability.
Looking ahead, Canon forecasts a 1.4% rise in printing revenue to ¥2.56tn ($16.2bn/ €15bn) in 2025, with an expected margin improvement to 12.7%. Key growth drivers include the expansion of commercial and label printing, new models of office MFDs, and a strategic partnership with Heidelberg, a leader in offset printing.
Canon’s laser printer sales rebounded in 2024, driven by a substantial increase following inventory adjustments by an OEM (HP?) partner. However, the company warned of a potential slowdown in 2025 as post-pandemic demand stabilises.
The medical business, while generating ¥568bn ($3.6bn/ €3.3bn) in 2024, saw weaker profitability due to higher costs and market challenges in Europe and Japan. Canon remains committed to long-term growth in healthcare technology, despite the short-term setback.
Takign a leaf out of the HP shareholder play book, Canon is rewarding shareholders despite the profit slump, increasing its annual dividend to ¥155 ($0.98/ €0.91) per share, up 15 yen from 2023, and announcing a ¥100bn ($632m/ €590m) share buyback programme. For 2025, it plans to raise dividends further to ¥160 ($1.01/ €0.94) per share, citing confidence in its cash flow and future profitability.
With a challenging economic backdrop in China and Europe, Canon is betting on commercial printing innovation and cost efficiency to maintain its market position. The company remains bullish on the long-term digital transformation of print but faces headwinds in consumer segments and economic volatility in key markets.
Categories : City News
Tags : Business Canon Financials FY2024 Sales
